Segment Information

3 Months Ended

Jun. 30, 2025

Note 10 — Segment Information

The Company reports its results in two separate segments consisting of communication services and defense and advanced technologies. The Company's segments are determined consistent with the way management currently organizes and evaluates financial information internally for making operating decisions and assessing performance.

The Company’s reportable segments (communication services and defense and advanced technologies) have been determined based upon their market and economic characteristics while also giving consideration to the structure and management of various business lines. The reportable segments are primarily determined based upon industry categories and core competencies relating to product or service end market distribution, operations, and servicing and distinguished by the type of customer and, to a lesser extent, the related contractual requirements.

The Company’s communication services segment provides a wide range of broadband and narrowband communications solutions across government and commercial mobility markets, as well as for residential and enterprise fixed broadband customers. The Company’s communication services segment revenues are primarily derived from the Company’s aviation services (including IFC services), government satcom services, maritime services (including narrowband and safety of communication capabilities), fixed broadband services, and energy services, as well as a wide array of advanced satellite and wireless products, networks and terminal solutions that support or enable the provision of fixed and mobile broadband and narrowband services.

The Company’s defense and advanced technologies segment develops and offers a diverse array of resilient, vertically integrated solutions to government and commercial customers, leveraging the Company’s technical competencies in encryption, cyber security, tactical gateways, modems and waveforms. The more regulated government environment for defense, encryption and other products is subject to unique contractual requirements and possesses economic characteristics that differ from the communication services segment. The Company’s defense and advanced technologies segment revenues are primarily derived from the Company’s information security and cyber defense, space and mission systems, tactical networking, and advanced technologies and other products and services, which are provided to government and commercial customers.

The Company's Chief Operating Decision Maker (CODM) is the Company's Chairman of the Board and Chief Executive Officer. Segment operating profits (losses) are the primary measure used by the Company's CODM to evaluate segment operating performance. The CODM regularly reviews budget-to-actual variances of segment operating profits (losses) when evaluating segment performance and allocating resources to each segment.

Segment revenues, expenses and operating profits (losses) for the three months ended June 30, 2025 and 2024 were as follows:


	Three Months Ended
	June 30, 2025			June 30, 2024
	(In thousands)
Revenues:
Communication services
Aviation services	$	292,892		$	257,155
Government satcom services		191,768			183,873
Maritime services		117,801			123,947
Fixed services and other services		174,737			201,636
Total services		777,198			766,611
Total products		50,173			60,176
Total communication services revenues		827,371			826,787
Defense and advanced technologies
Total services		49,172			54,110
Information security and cyber defense products		102,148			55,507
Space and mission systems products		87,973			73,306
Tactical networking products		68,279			71,410
Advanced technologies and other products		36,111			45,340
Total products		294,511			245,563
Total defense and advanced technologies revenues		343,683			299,673
Elimination of intersegment revenues		—			—
Total revenues	$	1,171,054		$	1,126,460
Expenses:
Communication services
Depreciation	$	246,749		$	238,393
Stock-based compensation expense		8,312			12,095
Other than acquired intangible assets amortization (1)		14,009			10,740
Acquisition and transaction related expenses		7,874			1,786
Other segment items (2)		509,551			521,834
Total communication services expenses (3)		786,495			784,848
Defense and advanced technologies
Depreciation		10,952			11,407
Stock-based compensation expense		6,395			7,087
Other than acquired intangible assets amortization (1)		4,893			4,449
Acquisition and transaction related expenses		1,851			515
Other segment items (2)		248,055			192,204
Total defense and advanced technologies expenses (3)		272,146			215,662
Total expenses	$	1,058,641		$	1,000,510
Operating profits (losses):
Communication services	$	40,876		$	41,939
Defense and advanced technologies		71,537			84,011
Elimination of intersegment operating profits (losses)		—			—
Segment operating profit (loss) before corporate		112,413			125,950
Corporate:
Amortization of acquired intangible assets		(65,741	)		(66,215	)
Interest income		14,290			22,792
Interest expense		(100,357	)		(105,776	)
(Loss) gain on extinguishment of debt		(288	)	—
Other income (expense), net		(5,164	)	—
Income (loss) before income taxes	$	(44,847	)	$	(23,249	)

(1)

Including amortization of capitalized cloud computing implementation costs.

(2)

Other segment items include operating expenses such as cost of service and product revenues, selling, general and administrative expenses, IR&D expenses and related activities excluding allocable portion of depreciation, other than acquired intangibles amortization, stock-based compensation, and certain significant items that are disclosed under each segment.

(3)

For the three months ended June 30, 2025 and 2024, IR&D expense and related activities, including allocable depreciation, stock-based compensation and other expenses were $19.2 million and $25.8 million, respectively, for the communication services segment, and $15.0 million and $12.8 million, respectively, for the defense and advanced technologies segment.

The CODM is not regularly provided assets on a segment basis, therefore, such information is not presented.

Revenues by geographic area for the three months ended June 30, 2025 and 2024 were as follows:


	Three Months Ended
	June 30, 2025		June 30, 2024
	(In thousands)
U.S. customers	$	815,333	$	776,495
Non-U.S. customers (each country individually insignificant)		355,721		349,965
Total revenues	$	1,171,054	$	1,126,460

The Company distinguishes revenues from external customers by geographic area based on customer location.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

VIASAT INC 10-Q