BlackSky Technology, Inc. (NYSE: BKSY) has unveiled its second-quarter financial results for 2025, presenting a mixed bag of achievements and challenges. The company reported revenues of $22.2M, adjusted EBITDA of ($2.8)M, and EPS of ($1.27), aligning with revenue expectations but marking a decline from the previous year's adjusted EBITDA profit of $2.1M. This downturn is largely due to reduced professional services revenue and continued investments in its Gen-3 and AROS projects.
Despite these challenges, BlackSky has made significant strides in its core offerings. Imagery and Software Analytical Services revenue grew by 2.9% year-over-year to $18.0M, fueled by increased demand and early access activities related to Gen-3 imagery. However, Professional and Engineering Services revenue fell to $4.2M from $7.5M in the same quarter last year, attributed to timing differences in milestone-based contract recognition. The company's consolidated gross margins also saw a slight decrease to 71.9% from 72.4%.
Strategic contract wins have been a bright spot for BlackSky, with over $35.0M in new contracts secured in the second quarter, pushing its total backlog to $356.0M. Notably, 85% of this backlog comes from international customers, showcasing the company's global appeal. Among these achievements are a $24.0M NGA Luno A monitoring award and expansion into Latin America with a Gen-2/Gen-3 On-Demand contract. Furthermore, BlackSky has advanced its Gen-3 architecture through a follow-on U.S. Navy research award focusing on optical inter-satellite link (OISL) technology.
The launch and commissioning of its second Gen-3 satellite represent a pivotal achievement for BlackSky, with the satellite delivering very-high resolution (35cm-class) imagery within 12 hours of launch. The company is progressing toward deploying six Gen-3 satellites in 2025 and eight by early 2026, with commercial availability anticipated in the fourth quarter of 2025. This expansion is supported by a strengthened balance sheet, following a $185.0M upsized convertible note offering, ensuring continued investment in its satellite constellation.
BlackSky has reaffirmed its FY25 revenue guidance of $105M–$130M and adjusted EBITDA of breakeven to $10M, expecting stronger revenue in the second half of the year due to increased Gen-3 availability and backlog conversion. These developments highlight BlackSky's strategic focus on innovation and growth in the competitive satellite imagery and intelligence market.
