Mathieu Robilliard

Mathieu Robilliard asked about the impact of a non-renewed contract on broadband revenue, Iridium's exposure to pure connectivity services in maritime, and sought clarification on the Deutsche Telekom NTN IoT agreement, including potential ARPU impact from D2D initiatives.

Answer

CEO Matthew J. Desch clarified that the broadband decline was due to a one-time contract termination a year ago, not a new trend, and expects broadband to flatten out. He explained that the Deutsche Telekom agreement is an MOU for Iridium NTN Direct, their new narrowband IoT standards-based solution, which will likely bring lower ARPU but expand the market into new applications like smart meters.

Mathieu Robilliard asked about the broadband vertical, specifically if there's still an impact from the loss of pure connectivity services and Iridium's exposure to maritime connectivity. He also sought clarification on the Deutsche Telekom deal for IoT, asking if it's based on existing solutions or the new NTN IoT, and whether the D2D initiative could lead to lower ARPU for the same number of subscribers.

Answer

CEO Matt Desch clarified that a one-time contract impacting broadband revenue was not maritime and was recognized a year ago, expecting broadband to eventually flatten out with new products. He confirmed the Deutsche Telekom announcement was for Iridium NTN Direct, their new narrowband IoT standards-based solution, currently in testing for a 2026 service launch. Mr. Desch anticipates lower ARPU but market expansion into applications like smart meters and agricultural sensors not currently addressable by proprietary solutions.

Mathieu Robilliard of Barclays asked for confirmation on the 2025 outlook for R&D and SG&A expenses. He also questioned the revenue model for GMDSS and sought clarification on whether the 'richer experience' of the next-generation network implied services beyond messaging, such as broadband.

Answer

CFO Vincent O’Neill confirmed that R&D would decline in 2025 as guided, while SG&A is expected to be flat to low single-digit growth. CEO Matthew Desch clarified that GMDSS is a free, mandated service, but the value is in the combined terminal that offers other revenue-generating services. He confirmed the next-gen network vision extends beyond messaging, aiming to provide a richer, 5G/6G standards-based data experience, potentially including broadband to mobile devices.

Mathieu Robilliard from Barclays asked when the negative revenue impact in the maritime segment from Starlink competition is expected to stabilize and sought clarification on the statement that competing D2D services would only add 10-15% coverage, questioning why it wasn't a larger extension.

Answer

CEO Matt Desch expressed hope for maritime stabilization but couldn't forecast a precise end, expecting normalization in 2026 as more Iridium Certus GMDSS terminals become available. He clarified his coverage comment, stating that terrestrial cellular currently covers 10-15% of the globe. Competing D2D services, which use terrestrial cellular frequencies, will face significant regulatory and interference issues, limiting their operation to specific countries and preventing true global coverage, unlike Iridium's L-band service.

Mathieu Robilliard of Barclays asked about Iridium's view on its spectrum assets in light of recent L-band transactions and whether its current holdings are a constraint. He also questioned if the unique competitive advantages of L-band could be eroded over time by innovation in other satellite bands.

Answer

CEO Matt Desch affirmed the high value of Iridium's global L-band spectrum, stating they have ample capacity for their mission-critical and safety-focused strategy and do not need to acquire more. He expressed confidence in L-band's durable competitive moat for regulated safety services, noting it is unlikely that shared bands like Ka/Ku will be approved for such applications due to fundamental regulatory and technical differences.

Mathieu Robilliard questioned the free cash flow guidance, which now excludes discontinued operations, asking if 'similar' means flattish and why the 2024 base was adjusted. He also asked for an update on 1&1's efforts to obtain low-band spectrum in Germany.

Answer

Executive Laura de Baquedano confirmed the free cash flow guidance remains stable or 'flattish' for 2025 on a continuing operations basis. She explained the 2024 base improved because the negative contribution from Peru, which included tax-related payments, was removed. Executive Markus Haas addressed the Germany question, stating that while Telefonica will meet its spectrum obligations, 1&1 should first approach its national roaming host, Vodafone, for low-band spectrum.

Mathieu Robilliard asked about the wholesale revenue trajectory in France, questioning if Orange could perform better than its guidance of a EUR 1 billion decline, and sought to understand the net free cash flow impact of the new cost-cutting plan.

Answer

CEO Christel Heydemann confirmed that while the Q1 wholesale decline was moderate, a stronger decline is expected in H2 due to base effects, keeping the company in line with its forecast and offering no upside. CFO Laurent Martinez explained that the cost-cutting plan will have a slight positive cash flow impact starting in 2026 and across the program's implementation, eventually increasing as restructuring payments phase out.

Mathieu Robilliard of Barclays followed up on the Puerto Rico segment's performance, questioning the path to EBITDA recovery given flat revenues and asking about the upcoming integration of Echostar subscribers in light of the difficult AT&T migration.

Answer

CEO Balan Nair outlined a multi-faceted recovery plan for Puerto Rico involving further cost-cutting, investing in sales growth with a focus on B2B, and leveraging the new 'Liberty Loop' converged offer. Regarding the Echostar deal, he explained the integration will be much smoother because LLA now has its own operational mobile network and IT stack, and the incoming subscribers are prepaid, which is less complex than the postpaid migration from AT&T.

Asked about the expected slowdown in Equans' revenue growth, the reason for the slight dip in Colas's French backlog, and the drivers behind the strong fixed ABPU growth in the telco segment.

Answer

The executive explained that Equans is prioritizing profitability over top-line growth. For Colas, the backlog is stable and Q1 orders in France were strong. The fixed telco ABPU growth is driven by a market shift to higher-end FTTH, Bouygues catching up to competitor pricing, and market share gains in potentially higher-ABPU rural areas.