Viasat shares took off after the satellite communications company said it expects to achieve positive free cash flow during the first half of calendar 2025, rather than the second half, excluding the positive impact of satellite insurance proceeds.
The Carlsbad, California-based company said it has determined it will not need to replace its ViaSat-3 F1 satellite which encountered a mechanical deployment issue to meet the needs of its mobility customers.
It said that while it has determined the satellite payload is functional, it expects to recover less than 10% of the planned throughout.
The company confirmed it has insurance coverage of $420 million in place for ViaSat-3 F1 and it will finalize its claim by the year-end.
Having determined it will not need to replace the ViaSat-3 F1 satellite, it noted that the majority of the capital expenditures related to the ViaSat-3 constellation have been completed and, as such, it is forecasting capital expenditures in fiscal 2025 to decline from fiscal 2024 and to be in the range of $1.4 billion to $1.5 billion.
Further, Viasat noted it expects to achieve synergies from its acquisition of satellite service provider Immarsat earlier than planned.
Synergy estimates of approximately $80 million in annual operating expenses and approximately $110 million in annual capital expenditures are now anticipated to be fully realized in the 2025 financial year, compared to the three-year period originally planned.
Viasat shares had added 12% at US$17.50 mid-morning on Thursday.
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