# Comtech Reports FY26 Results and Agrees to Sell Satellite Unit for $157.5 Million

- URL: https://stocks.freetheai.org/news/comtech-reports-fy26-results-and-agrees-to-sell-satellite-unit-for-157-5-million-82bb12
- Published: 2026-10-14T20:34:00Z
- Category: earnings; sentiment: mixed; impact: high
- Symbols: [NASDAQ:CMTL](https://stocks.freetheai.org/symbols/NASDAQ-CMTL)
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Comtech Telecommunications Corp. (CMTL) reported full-year 2026 net sales of $249.6 million, down 17% compared to the prior year as lower-margin products wound down. Despite the revenue drop, Adjusted EBITDA increased to $20.6 million, representing an 8.3% margin up from 5.5% previously. Operating cash flow turned positive at $25.0 million. In tandem with earnings, Comtech agreed to sell the majority of its Satellite & Space Communications segment to Gilat for $157.5 million.

The divestiture marks a significant strategic pivot toward public safety services through Allerium while exiting most satellite hardware operations. Comtech expects net proceeds of about $128.3 million from the deal, which it plans to direct toward reducing debt. Specifically, 65% of net proceeds will go toward its credit facility and 35% toward subordinated debt, helping to lower ongoing interest expenses. The company also amended its debt terms to improve balance sheet flexibility.

Investors will look for the transaction closing in 2026, along with the execution of the company's recapitalization strategy. Key areas to monitor include whether Comtech can maintain its margin expansion and cash flow momentum in fiscal 2027. The company ended the year with a backlog of $520.4 million, a book-to-bill ratio of 1.06x, and a recurring revenue mix of roughly 80%.

## Key points

- Comtech Telecommunications Corp. (CMTL) reported full-year 2026 net sales of $249.6 million, down 17% year-over-year.
- Adjusted EBITDA reached $20.6 million with an 8.3% margin, up from 5.5% in the prior year.
- The company generated $25.0 million in operating cash flow, reversing a cash draw from the previous year.
- Comtech agreed to sell most of its Satellite & Space Communications segment to Gilat for $157.5 million.
- Net proceeds of approximately $128.3 million will be used to pay down debt under its credit facility and subordinated debt.

## Questions and answers

### Why did Comtech sell its Satellite & Space Communications segment?

Comtech agreed to sell the segment to Gilat for $157.5 million to shift its strategic focus toward public safety services and generate estimated net proceeds of $128.3 million to reduce its debt burden.

### What were Comtech's full-year 2026 financial results?

Comtech reported FY26 net sales of $249.6 million, Adjusted EBITDA of $20.6 million (an 8.3% margin), and positive operating cash flow of $25.0 million.

### How will Comtech use the proceeds from the segment sale?

Comtech plans to allocate 65% of the estimated $128.3 million net proceeds to its credit facility and 35% to subordinated debt to lower interest costs.