MDA Space (TSE:MDA) used its fourth-quarter and full-year 2025 earnings call to detail what CEO Mike Greenley described as the company’s “best yet since the IPO,” highlighted by record revenue and Adjusted EBITDA, a CAD 4 billion year-end backlog, and a newly disclosed CAD 40 billion five-year opportunity pipeline.
Record 2025 results and a strong year-end balance sheet
Greenley said MDA Space delivered record results for both revenue and Adjusted EBITDA in 2025, with revenue rising to about CAD 1.6 billion—up more than 50% year-over-year—and Adjusted EBITDA increasing to CAD 324 million, up almost 50% compared with the prior year. He noted the company maintained an Adjusted EBITDA margin of approximately 20% for the full year.
Lavoie said gross profit in the fourth quarter was CAD 127 million, up 55% year-over-year, with gross margin improving to 25.5% from 23.6%. For the full year, gross profit increased 45% to CAD 410 million, while gross margin was 25.1% compared with 26.1% in 2024, which management attributed to evolving program mix.
Adjusted net income in the fourth quarter was CAD 59 million versus CAD 35 million in Q4 2024, while full-year adjusted net income rose to CAD 190 million, up 71%. Adjusted diluted EPS came in at CAD 0.45 for the quarter and CAD 1.46 for the year, up 61% and 66%, respectively, versus the prior year periods.
On cash flow, management emphasized that 2025 included significant investment while still generating free cash flow. Greenley said the company deployed CAD 242 million in CapEx and generated free cash flow of CAD 165 million for the year. Lavoie added that fourth-quarter cash from operations was CAD 51 million (down from CAD 376 million a year earlier), reflecting “normal program-related working capital fluctuations,” and free cash flow was slightly negative at -CAD 20 million for the quarter.
The company ended the quarter with net cash of CAD 152 million, liquidity of CAD 669 million under its credit facility, and total available liquidity of CAD 821 million. Lavoie said net debt to trailing twelve-month Adjusted EBITDA was 0.4x. During the quarter, MDA Space issued CAD 250 million of senior unsecured notes due 2030 and amended its CAD 700 million revolving credit facility, extending maturity to 2030 and adding a CAD 150 million accordion feature.
2026 outlook: revenue growth with lower free cash flow expected
Management introduced 2026 guidance, pointing to the CAD 4 billion backlog as a source of “strong revenue visibility.” For the full year, MDA Space expects:
- Revenue: CAD 1.7 billion to CAD 1.9 billion
- Adjusted EBITDA: CAD 320 million to CAD 370 million
- Adjusted EBITDA margin: 18% to 20%
- Capital expenditures: CAD 225 million to CAD 275 million
- Free cash flow: neutral to negative
Greenley and Lavoie both said the free cash flow outlook reflects working capital fluctuations on existing programs and continued growth investments. Lavoie said the Adjusted EBITDA range is intended to provide flexibility to “strategically scale up the business for future growth,” including in R&D and SG&A, while remaining aligned with the company’s margin goals since the IPO.
Backlog, pipeline expansion, and defense push
MDA Space ended 2025 with a CAD 4 billion backlog, which Lavoie said was slightly below the prior year due to backlog conversion into revenue and normal variability in annual order levels. Greenley announced that the company’s five-year pipeline totals CAD 40 billion in cumulative opportunities, including CAD 10 billion of opportunities where MDA Space has been downselected by government customers or where follow-on work exists with current customers.
In Q&A, management said the pipeline increase reflects an annual review and opportunities added over the course of 2025, with “chunkier growth” on the defense side, including non-space defense following the launch of a dedicated organization called 49th North. Greenley described 49th North as focused on secure multi-domain C5ISR and other “mission-critical capabilities” outside space, intended to address rising demand for sovereign defense capability across land, air, maritime, and joint domains.
Asked about defense mix, Greenley said he would not expect a “big sudden change” exiting 2026, but suggested defense-related revenue could start to lift in 2027 and 2028 if pipeline opportunities convert to contracts. Lavoie said defense contracts typically come with lower EBITDA margins, though he added that larger defense wins could still benefit the business through higher absolute EBITDA and EPS even if margins compress.
Business updates: satellites, robotics, and geointelligence
Satellite Systems: Greenley said satellite systems revenue grew 85% year-over-year in 2025, and Lavoie reported Q4 satellite systems revenue of CAD 371 million (up 58%) and full-year revenue of CAD 1.1 billion (up more than CAD 500 million, or 85%). Management attributed the growth to increased work on Telesat Lightspeed and the Globalstar next-generation LEO constellation, as well as the impact of an EchoStar termination agreement.
On key programs, Greenley said MDA Space expects to deliver “a small number” of Telesat Lightspeed satellites in 2026, with deliveries ramping in 2027. He also said the Globalstar next-generation LEO constellation achieved completion of Critical Design Review, with life testing, procurement, and initial assembly and integration underway. On the initial Globalstar program for 17 satellites, management said production and integration continued, with 15 satellites on the shop floor and eight having completed functional acceptance testing, and that deliveries are tracking to the revised timeline established in Q4 after prior delays.
Greenley said the company entered into a termination agreement with EchoStar after the customer cancelled the contract awarded the prior year. Lavoie said the termination process is complete and the company received payments it was entitled to, but the terms and amount are confidential.
Robotics and Space Operations: Lavoie said Q4 revenue in robotics and space operations was CAD 66 million, in line with Q4 2024 due to timing of revenue recognition on non-labor costs, while full-year revenue rose 11% to CAD 309 million on increased Phase C work for Canadarm3. Greenley highlighted progress on Canadarm3 engineering models and work toward Critical Design Review, and said the company continues to engage with commercial low Earth orbit destination companies regarding “SKYMAKER” robotics compatibility. He added that NASA is expected to release the next phase procurement call for commercial LEO destinations in the coming months.
Geointelligence: Greenley said the Canadian Space Agency awarded MDA Space a CAD 45 million authorization to proceed for long-lead parts required for a replenishment satellite for the RADARSAT Constellation Mission, part of the government’s CAD 1 billion RADARSAT+ initiative. He added the CSA announced its intention to further contract MDA Space to build, test, and launch the satellite, and said MDA Space was selected for a concept study supporting RADARSAT+’s next-generation mission. On CHORUS, management said electrical integration and testing progressed, full SAR antenna testing advanced, ground-segment flight control procedure validation began, and construction continued for a new Mission Control Center, with the program tracking to a late-2026 launch window.
Capex priorities and capital allocation approach
On capital spending, Lavoie said Q4 CapEx was CAD 70 million, up significantly year-over-year, and full-year CapEx was CAD 242 million. For 2026, he said investments will focus on Lightspeed and Globalstar production-line equipment, continued site needs tied to growth at the Montreal facility, and capitalized development work on a space-grade chip following the SatixFy acquisition. Looking beyond 2026, he said it is “too early” to forecast 2027 precisely, but suggested CAD 150 million to CAD 200 million could be a reasonable long-term annual CapEx assumption given the addition of chip capabilities.
In response to a question on capital allocation, management said priorities remain organic growth investments and potential acquisitions, particularly those that support geographic expansion and vertical integration. Lavoie said the company is not considering dividends or share buybacks at this time and remains focused on growing the business.
Greenley also noted a board change, saying director Alison Alfers resigned effective March 3, 2026, due to unexpected family circumstances.
About MDA Space (TSE:MDA)
MDA Space Ltd, formerly MDA Ltd, is a global space company. The Company is a robotics, satellite systems and Geo intelligence provider. It provides communications satellites and earth and space observation. It is also involved in space exploration and infrastructure. Its software, AURORA, is a digital satellite product line providing critical new solutions to operators. AURORA technology enables constellations to extend communication networks to every corner of the globe with digital automation, and robotics.
