SES Revenue Jumps 80% in First Full Quarter With Intelsat, but the Real Test Is Synergies

SES, Luxembourg's flagship satellite operator, reported a sharp jump in first-quarter revenue on the back of its acquisition of Intelsat, but the figures underscore a harder question facing Europe's largest satcom group: whether it can turn a 3.1 billion dollar deal into the cost savings it has promised investors.

The Betzdorf-based company said revenue rose 80.5% year-on-year at constant currency to 847 million euros in the three months to the end of March, its first full quarter consolidating Intelsat following the deal's close on 17 July 2025. Adjusted EBITDA increased 57.0% as reported to 404 million euros. SES reiterated its full-year outlook for 2026.

Almost all of that headline growth is an accounting effect rather than organic momentum. Measured on a like-for-like basis — treating Intelsat as though it had always belonged to the group — revenue grew just 3.1% and adjusted EBITDA 5.0%. That gap between the reported and underlying numbers is the story of SES's year: a vastly larger company growing slowly, betting that scale and integration will pay off in a consolidating market.

Networks carries the quarter

The Networks division did most of the heavy lifting. Networks revenue rose 106.0% year-on-year and now accounts for roughly two-thirds of the group total. Within it, Mobility surged 207.8%, Government climbed 50.7% and Fixed Data rose 79.0%.

The Mobility figure reflects booming demand for inflight connectivity, an area where the enlarged fleet gives SES a competitive edge. Around 600 aircraft are now flying with the company's multi-orbit in-flight connectivity system. Media revenue, the legacy broadcasting business that once defined the company, came in at 285 million euros, up 42.9% as reported, lifted by the full consolidation of Intelsat.

The combination has created a multi-orbit fleet of roughly 120 satellites — about 90 in geostationary orbit and nearly 30 in medium Earth orbit, alongside low-Earth-orbit partnerships — operated by a workforce of around 4,000. That positions SES against Starlink and other low-orbit rivals in a satcom market where traditional geostationary and medium-orbit capacity is under pressure.

The synergy question

The deeper test is financial. The Intelsat transaction, valued at about 3.1 billion dollars, was sold to investors on the promise of synergies worth 2.4 billion euros in net present value, with an annual run rate of approximately 370 million euros and 70% of that realised within three years.

Chief Executive Adel Al-Saleh presented the quarter as evidence the integration is on track.

"Q1 2026 marks a solid start to the year for SES as a combined company with focused execution across our Networks and Media businesses," he said.

He pointed to early cost discipline as the clearest sign of progress. "Staff costs are down 20% and overall OpEx is down 9% year-on-year at constant currency on a like-for-like basis," Al-Saleh said. Those reductions move the group toward its synergy target, though the bulk of the promised savings remain to be banked over the coming three years.

The early numbers cut both ways. They show management can take costs out of the combined business quickly. But the modest 3.1% like-for-like revenue growth signals that, even with mobility and aviation expanding fast, the underlying top line is advancing only slowly — leaving cost cuts, rather than sales growth, to do much of the work of justifying the acquisition.

A Luxembourg space bet

For Luxembourg, the stakes extend beyond one company's earnings. SES's headquarters at the Château de Betzdorf anchor the Grand Duchy's standing as a European space hub, and the enlarged group — among the world's largest multi-orbit satellite operators — reinforces that position.

The outlook SES reaffirmed for 2026 is deliberately measured: the company expects revenue and adjusted EBITDA to remain broadly stable year-on-year on a like-for-like, constant-currency basis. In other words, the near-term growth case rests less on selling more capacity than on extracting value from the merger itself.

Al-Saleh framed the ambition in broader terms when the deal closed last July. "Today, we're not just merging two companies — we're creating a stronger company, built for the future," he said. The first full quarter offers early, partial validation. The verdict on whether 3.1 billion dollars buys a durable advantage against lower-orbit competitors will take years to deliver.