Globalstar reports record revenue but faces future uncertainty

Globalstar, a satellite communications company, reported record revenues for 2024. The company announced a 12% increase in revenue, totaling $250.3 million. In the fourth quarter alone, revenue rose 18% year over year to $61.2 million, surpassing analyst expectations. Despite the strong revenue figures, Globalstar's stock fell about 2% after the earnings announcement. The company did incur a net loss of $50.2 million for the fourth quarter, mostly due to noncash losses related to debt payments. For the entire year, Globalstar lost $63.2 million. Management also highlighted a significant improvement in free cash flow, generating $185 million in 2024 compared to a loss of $100 million in 2023. However, this figure was not emphasized in their earnings release, which some analysts found surprising. Looking ahead, analysts raised concerns about Globalstar's ability to maintain its cash flow in 2025. CFO Rebecca Clary did not provide specific future cash flow projections, noting that it depends on factors such as satellite launches and costs shared with their major customer, believed to be Apple. Analysts from S&P Global predict that Globalstar's free cash flow will turn negative again in 2025, with only modest recovery expected in 2026. Given these uncertainties, some analysts suggest that Globalstar’s stock may not be a good investment at its current valuation.