Comtech Announces Financial Results for Fourth Quarter and Fiscal Year 2025

Fiscal Q4 2025 Results Demonstrate Continued Progress in Comtech's Successful Transformation

Comtech Strengthens Financial Position with $11 Million of Positive Operating Cash Flow and Liquidity of $47 Million

CHANDLER, Ariz.--(BUSINESS WIRE)--$CMTL #5G--November 10, 2025-- Comtech Telecommunications Corp. (NASDAQ: CMTL) (“Comtech” or the “Company”), a global communications technology leader, today reported financial results for its fourth quarter and fiscal year ended July 31, 2025.

Ken Traub, Chairman, President and CEO, stated:

“I am proud to report how much stronger Comtech is today – financially, operationally and strategically. This is the result of the ongoing successful execution of the transformation initiatives that we announced when I started as CEO in January 2025. As a testament to our improving financial health, the disclosure regarding the Company's ability to continue as a going concern, that was previously in the Company's quarterly SEC filings for the past seven quarters, has been removed as we no longer have those concerns. We have executed a successful turnaround of our Satellite & Space Communications business, which is now revitalized, and our Allerium business, formerly known as Terrestrial & Wireless Networks, has continued to deepen our presence in the public safety market while securing long-term customer partnerships. We expect the Company's significantly improved financial health to be reassuring to our current and prospective customers, vendors, employees, investors and partners.

The early success of our transformation initiatives and the positive trajectory of the business are evident across numerous key metrics. Examples include: (i) operating cash flow of $11.4 million in the fourth quarter, which follows the $2.3 million of operating cash flow we reported in the third quarter – these are the first quarters of positive operating cash flow for Comtech since fiscal 2023, (ii) liquidity of $47 million, the highest level that Comtech has had in recent history, and an improvement from $27 million of liquidity disclosed in March, (iii) accounts payable reduced to just $26 million, the lowest level Comtech has had in years and down from $43 million as of January 31, (iv) net sales for the fourth quarter increased by 13% as compared to the first quarter of fiscal 2025, despite the wind down of certain legacy contracts, exit from a number of low margin contracts, elimination of other unsatisfactory revenue, and a $3.5 million adjustment as a result of revised estimates for a nonrecurring development project, (v) gross margins increased from 12.5% in the first quarter to 31.2% in the fourth quarter, and (vi) Adjusted EBITDA improved throughout fiscal 2025, from negative $31 million in the first quarter, to $13 million in the fourth quarter.

While we are just getting started – and recognize there are remaining legacy challenges still to be addressed as well as inevitable quarterly fluctuations – we are energized by what we have accomplished so far. These accomplishments were enabled by new disciplines that align accountability throughout the organization, enhanced operational efficiency, reduced cost structures, a focus on cash flow optimization, improved working capital management and improved corporate governance. These initiatives have not only helped to drive Comtech's significantly improved operating and financial performance, but have also enabled us to improve relationships with current and prospective customers, vendors and creditors. This leads to a flywheel effect in which improved relationships create a healthier dynamic for the business going forward and ultimately further improvements in performance.

Finally, we have been reinvigorating the corporate culture by emphasizing transparency, empowerment and accountability. On a personal note, it is particularly gratifying for me to see how our employees are increasingly taking pride in contributing to our success, which has also enhanced morale, retention and performance.”

Please review our fiscal 2025 results and commentary below, and join our conference call on Monday, November 10, 2025, at 4:30 PM Eastern Time, for further details about Comtech’s transformation and prospects.

Fiscal Year 2025 Consolidated Financial Results

• Net sales of $499.5 million
• Gross margin of 25.6%
• Operating loss of $139.1 million
• Net loss attributable to common shareholders of $204.3 million
• Adjusted EBITDA (a Non-GAAP measure) loss of $2.0 million
• Net bookings of $372.7 million, representing a book-to-bill ratio of 0.75x
• Funded backlog at year end of $672.1 million
• GAAP cash flows used in operations of $8.3 million
• Total liquidity at year end of $47.0 million

Fourth Quarter Fiscal 2025 Consolidated Financial Results

• Net sales of $130.4 million
• Gross margin of 31.2%
• Operating income of $1.9 million
• Net loss attributable to common shareholders of $11.6 million
• Adjusted EBITDA (a Non-GAAP measure) of $13.3 million
• Net bookings of $94.4 million, representing a book-to-bill ratio of 0.72x
• GAAP cash flows provided by operations of $11.4 million

Fiscal 2025 Consolidated Results Commentary

Net sales were $499.5 million for fiscal 2025, a 7.6% decline from $540.4 million for 2024. The change reflects significantly lower net sales in our Satellite and Space Communications (“S&S”) segment offset, in part, by higher net sales in our Allerium (formerly, Terrestrial and Wireless Networks or “T&W”) segment, as further discussed below. The change in sales reflects the anticipated wind down of certain legacy troposcatter contracts, lower sales of EEE space components and antennas (including those related to the CGC divestiture that we initiated in our fourth quarter of fiscal 2024) and the divestiture of our high-power solid-state amplifiers product line in November 2023. These items were offset, in part, by higher sales of NG-911 emergency communication, call handling and location-based solutions, and satellite ground infrastructure solutions and VSAT and similar equipment sales to the U.S. Army. More broadly, the decrease in S&S segment net sales is primarily attributable to the discontinuation of certain low-margin business in order to focus on opportunities in which we can provide a more differentiated solution at higher margins.

Gross profit was $127.9 million and gross margin was 25.6%, compared to $157.2 million and 29.1% in the prior year. Fiscal 2025 gross margins were impacted by an $11.4 million non-cash charge in our first quarter due to restructuring-related inventory write downs in the S&S segment and a $3.5 million adjustment in our fourth quarter due to higher expected costs at completion on a non-recurring engineering related project in our S&S segment.

Operating loss was $139.1 million, compared to a $79.9 million operating loss in fiscal 2024; results for fiscal 2025 were heavily influenced by performance in the first quarter, which also included an incremental non-cash goodwill impairment charge.

As outlined in our Form 10-K for fiscal 2025, net loss attributable to common shareholders was $204.3 million, compared to $135.4 million for fiscal 2024. In aggregate, fiscal 2025 results were impacted by $187.5 million of net charges, of which $167.1 million were non-cash. Our quarterly net loss attributable to common shareholders improved sequentially throughout fiscal 2025, due primarily to improved operational and financial performance.

Adjusted EBITDA (a Non-GAAP measure) was negative $2.0 million, compared to positive $45.7 million for fiscal 2024. We experienced sequential quarterly improvements in Adjusted EBITDA throughout fiscal 2025, with increased correlation to operating cash flows than in the recent past. The improvements in Adjusted EBITDA throughout fiscal 2025 were a direct result of the transformation initiatives described above.

Fiscal 2025 net bookings were $372.7 million, representing a book-to-bill ratio of 0.75x, compared to $700.6 million and 1.30x for fiscal 2024. Fiscal 2025 bookings include a large debooking in our S&S segment related to a protested contract that was ultimately awarded to the incumbent provider. Fiscal 2024 bookings include a large multi-year contract awarded to us from an NG-911 customer in the Northeastern region of the U.S.

Funded backlog was $672.1 million as of July 31, 2025, compared to $798.9 million last year. Revenue visibility, measured as the sum of funded backlog and the total unfunded value of certain multi-year contracts, was approximately $1.1 billion as of July 31, 2025.

Fiscal 2025 GAAP cash flows used in operations were $8.3 million, a significant improvement from $54.5 million of cash flows used in operations in fiscal 2024. Fiscal 2025 includes $23.0 million in aggregate payments for restructuring costs, including severance, proxy solicitation costs and CEO transition costs, compared to $16.0 million in fiscal 2024. Fiscal 2025 also includes cash payments for interest and taxes of $29.6 million, compared to $23.0 million in fiscal 2024.

Liquidity improved 71.5% to $47.0 million as of July 31, 2025, compared to $27.4 million disclosed in March 2025.

Fourth Quarter Fiscal 2025 Consolidated Results Commentary

Net sales were $130.4 million, an approximate 3.0% increase from both the fourth quarter of fiscal 2024 and third quarter of fiscal 2025. Fourth quarter results benefited from earlier-than-anticipated orders in both segments, offset, in part, by a $3.5 million adjustment in our fourth quarter due to higher expected costs at completion on a non-recurring engineering related project in our S&S segment.

Gross profit was $40.7 million, or 31.2% of net sales, representing a substantial 50.2% increase from the prior year’s $27.1 million, or 21.5%. Gross profit in the fourth quarter also represents a 4.6% sequential increase from the preceding quarter’s $38.9 million, or 30.7%.

Operating income was $1.9 million, a significant improvement from both the $81.5 million operating loss in the fourth quarter of 2024 and the $1.5 million operating loss in the third quarter of fiscal 2025. The sequential improvement from the third quarter is due primarily to improved operational and financial performance during the period, specifically higher net sales and a more favorable mix of products and services sold, in addition to a decrease in selling, general, and administrative expenses (including lower restructuring costs).

Net loss attributable to common shareholders was $11.6 million in the fourth quarter of fiscal 2025, compared to $100.6 million in the prior year period and $14.5 million in the third quarter of fiscal 2025.

Adjusted EBITDA (a Non-GAAP measure) improved to $13.3 million or 10.2% of net sales, compared to $0.3 million or 0.2% in the fourth quarter of fiscal 2024 and $12.6 million or 9.9% in the third quarter of fiscal 2025. The fourth quarter of fiscal 2025 reflects the improved operating results, as discussed above.

Net bookings were $94.4 million, representing a book-to-bill ratio of 0.72x, compared to $271.5 million or 2.15x in the fourth quarter of fiscal 2024 and $71.0 million or 0.56x in the third quarter of fiscal 2025. Bookings in the prior year comparable period included a large multi-year contract awarded to us from an NG-911 customer in the Northeastern region of the U.S.

Fourth quarter fiscal 2025 GAAP cash flows provided by operations were $11.4 million, a substantial improvement from the $9.5 million of cash flows used in operations in the fourth quarter of 2024 and $2.3 million of cash flows provided by operations in the third quarter of fiscal 2025. These are the first quarters of positive operating cash flow for Comtech since fiscal 2023. The significant improvement is due to operational enhancements and our revitalized culture with aligned focus on optimizing cash flow which, in part, contributed to earlier-than-anticipated collections in our fourth quarter of fiscal 2025.

Fiscal 2025 Satellite and Space Communications (“S&S”) Segment Commentary

In the second quarter of fiscal 2025, Daniel Gizinski was promoted to President of the S&S business. In this new role, Mr. Gizinski and the team identified sources of previous underperformance, executed a remediation plan and positioned the S&S segment for margin improvement, cash flow generation and long-term growth. Key elements of the remediation plan included: recruiting new leaders for the segment, including a new Chief Operating Officer, Chief Financial Officer, Chief Technology Officer and General Manager; developing a new product roadmap featuring differentiated technologies aligned with customer needs; eliminating more than 50% of slow moving products, resulting in a differentiated, value-driven product line; restoring operational discipline; implementing productivity enhancements, cost reduction initiatives and a disciplined approach to procurement and inventory management; improving customer relations and contractual terms; and establishing best practices in program management, ensuring improved reliability and performance. As anticipated, these changes lowered the volume of net sales in fiscal 2025, but produced sequentially increasing quarterly gross profit (as a percentage of segment net sales), operating income (both in dollars and as a percentage of segment net sales), Adjusted EBITDA (both in dollars and as a percentage of segment net sales) and operating cash flow.

With these elements of the plan now in place, the S&S business is better positioned to pursue growth opportunities. We are prepared to meet increasing demand for technology to support 5G Non-Terrestrial Networks (referred to as “NTN”) and sovereign defense networks with the launch of our next-generation platforms. We are already seeing traction from the launch of our Digital Common Ground platform, including additional early production prototype order agreements.

Net sales in our S&S segment were $269.3 million for fiscal 2025, compared to $324.1 million for fiscal 2024. S&S net sales in fiscal 2025 reflect the anticipated discontinuation of certain legacy troposcatter contracts and low-margin business in order to focus on opportunities in which we can provide a more differentiated solution at higher margins, as well as an ongoing shift back to higher volume production orders in our satellite ground infrastructure solutions product line, as certain legacy low or no margin non-recurring engineering contracts draw nearer to completion.

S&S operating loss was $111.6 million in fiscal 2025, compared to an operating loss of $54.2 million in fiscal 2024. Fiscal 2025 operating loss in this segment was significantly impacted by the $79.6 million non-cash goodwill impairment charge in the first quarter. Fiscal 2025 also reflects significantly lower segment net sales and gross profit, both in dollars and as a percentage of related net sales (including an $11.4 million non-cash charge related to the write down of certain inventory and impact of the PST and CGC divestitures), higher selling, general and administrative expenses (driven by a $16.1 million non-cash charge related to an allowance for doubtful accounts, offset in part by cost savings initiatives) and higher amortization of intangibles, offset in part by lower internal research and development expenses due to higher levels of customer funded activities. Initiatives have been implemented within the S&S segment to rationalize product lines and to streamline the organization, in order to generate cost savings, improve accountability at the site level and enhance focus on priority products, production and customer commitments. These changes have resulted in sequential quarterly improvements in operating income for the S&S segment throughout fiscal 2025, improving from an operating loss of $118.8 million in the first quarter to operating income of $3.3 million in the fourth quarter.

S&S Adjusted EBITDA was a loss of $15.8 million in fiscal 2025, compared to positive $29.8 million in fiscal 2024. The segment’s Adjusted EBITDA improved sequentially in each quarter of fiscal 2025. The improvements in Adjusted EBITDA throughout fiscal 2025 for this segment were a direct result of the transformation initiatives described above.

S&S bookings were $167.7 million for fiscal 2025, representing a book-to-bill ratio of 0.62x. This compares to bookings of $333.0 million and 1.03x in fiscal 2024. The reduction in bookings from the year ago period reflects, in part, an approach to product positioning and sales that focuses on higher margin opportunities.

Fourth Quarter Fiscal 2025 Satellite and Space Communications (“S&S”) Segment Commentary

S&S net sales in the fourth quarter of fiscal 2025 were $69.0 million, a 3.6% decrease from $71.6 million in the fourth quarter of fiscal 2024, but a 2.1% increase from $67.6 million in the third quarter of fiscal 2025. Fourth quarter results for the S&S segment benefited from earlier-than-anticipated orders, offset, in part, by a $3.5 million adjustment in our fourth quarter due to higher expected costs at completion on a non-recurring engineering related project.

S&S operating income was $3.3 million in the fourth quarter of fiscal 2025, compared to an operating loss of $69.0 million in the fourth quarter of fiscal 2024 and operating income of $2.7 million in the third quarter of fiscal 2025. The sequential increase in quarterly operating income reflects higher segment net sales and gross margin (both in dollars and as a percentage of segment net sales).

S&S Adjusted EBITDA was $6.3 million in the fourth quarter of fiscal 2025, compared to $0.4 million in the fourth quarter of fiscal 2024 and $5.7 million in the third quarter of fiscal 2025. The fourth quarter of fiscal 2025 reflects the improved operating results for this segment, as discussed above.

S&S bookings were $44.5 million in the fourth quarter of fiscal 2025, representing a book-to-bill ratio of 0.65x. This compares to $67.3 million and 0.94x in the fourth quarter of fiscal 2024 and $17.4 million and 0.26x in the third quarter of fiscal 2025 (which included a large debooking related to a protested contract that was ultimately awarded to the incumbent provider).

In September 2025, as part of our cost savings plans, we made the decision to migrate certain production capabilities and operational functions to our manufacturing operations in Chandler, Arizona. This initiative, which is slated for completion in fiscal 2026, is expected to increase manufacturing efficiencies, further optimize our facilities footprint and lead to annualized cost savings of approximately $3.0 million.

During the fourth quarter of fiscal 2025, we were awarded orders that included:

• Additional funding of approximately $10.3 million from a major U.S. prime contractor in support of NASA's Orion Production and Operations Contract ("OPOC"), commonly known as the Artemis project;
• Incremental funding of approximately $7.4 million for continued, ongoing training and support of complex cybersecurity operations for U.S. government customers;
• $2.8 million in funded orders for VSAT equipment and related services for the U.S. Army (given the award of the follow on "VSAT IV" contract to a competitor, we do not expect material contributions from our legacy contract going forward);
• Over $2.0 million in funded orders for high power Ka band traveling wave tube amplifiers for use in a satellite constellation designed to provide high speed internet access to rural areas of the U.S.;
• Approximately $2.0 million in funded orders from a long-term, existing international customer for the procurement of EEE space parts and services;
• Approximately $2.0 million in funded orders from the U.S. Navy for satellite ground infrastructure solutions;
• Over $1.0 million in funded orders related to an international customer's replacement of an existing air traffic control network; and
• Over $1.0 million in funded orders for satellite ground infrastructure solutions intended for use in the SES mPower satellite constellation.

In the fourth quarter, the S&S business completed initial deliveries of our small-form factor troposcatter system, referred to as our Multi-Path Radio, or MPR, to an international Air Force customer. We believe the small form factor troposcatter capabilities align closely with modern defense demands, and we believe there will be increasing demand for the unique features and capabilities we offer.

During fiscal 2025, we began deliveries of initial production units to our prime contractor in support of a next-generation satellite modem contract and will be moving into full production during fiscal 2026, as the program transitions from a multi-year development period into a production-oriented stage. A second next-generation product with the same prime contractor has also significantly progressed in development and is also expected to begin production deliveries in fiscal 2026. These are important milestones for the S&S segment, as they address the long-awaited migration from low-margin nonrecurring engineering efforts to higher volume production with improved operating margins and faster cash conversion cycles.

Fiscal 2025 Allerium Segment Commentary

Allerium, a brand rooted in experience, driven by innovation and built for those who protect our communities, is the renamed segment that was formerly our Terrestrial and Wireless Networks (“T&W”) segment. Our rebranding unifies and clarifies Allerium’s go-to-market strategy under one name. The new name “Allerium” reaffirms our focus, commitment and dedication to achieving successful outcomes when it matters most – secure, reliable communications in the most critical circumstances.

Allerium net sales were $230.3 million in fiscal 2025, up 6.5% from $216.3 million in fiscal 2024. Relative to fiscal 2024, Allerium grew net sales of next-generation 911 ("NG-911") services and location-based solutions, while also expanding its customer base for call handling solutions. We continue to see customer upgrades to next-generation core services, new cloud-based emergency response products and increasing interest from international carriers for 5G location technologies as key growth drivers for the Allerium segment.

Allerium operating income was $24.1 million in fiscal 2025, up 11.1% from operating income of $21.7 million in fiscal 2024. The increase in our Allerium segment operating income, both in dollars and as a percentage of related segment net sales, reflects higher net sales and gross profit, offset in part by higher selling, general and administrative expenses and research and development expenses.

Allerium Adjusted EBITDA was $47.6 million in fiscal 2025, compared to $44.7 million in fiscal 2024. Fiscal 2025 reflects the improved operating results for this segment, as discussed above.

Allerium bookings were $204.9 million in fiscal 2025, representing a book-to-bill ratio of 0.89x, compared to $367.5 million and 1.70x in fiscal 2024. Fiscal 2024 bookings include a large multi-year contract awarded to us from an NG-911 customer in the Northeastern region of the U.S.

Fourth Quarter Fiscal 2025 Allerium Segment Commentary

Allerium net sales were $61.3 million in the fourth quarter of fiscal 2025, compared to $54.6 million in the fourth quarter of fiscal 2024 and $59.2 million in the third quarter of fiscal 2025, an increase of 12.3% and 3.5%, respectively. The increase in fourth quarter fiscal 2025 segment net sales, relative to both comparable periods, was due to higher sales of location based and NG-911 call handling solutions.

Allerium operating income was $7.

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