Satellogic Q2 2026 earnings: Revenue rises 259% as operating income turns positive

Satellogic (NASDAQ: SATL) reported Q2 2026 revenue of $15.9 million, up 259% from $4.4 million a year earlier, while diluted loss per share widened to $0.13 from $0.06. Operating income turned positive at $0.3 million and adjusted EBITDA reached $2.8 million, but a $19.7 million non-cash fair-value charge pushed the GAAP net loss to $20.0 million.

Core financial results

Revenue growth for the quarter ended June 30, 2026 came from both business lines, led by an $8.3 million increase in Space Systems revenue and a $3.2 million increase in imagery ordered by new and existing Data & Analytics customers. Costs grew more slowly than revenue: cost of revenue increased 137%, compared with the 259% top-line increase.

Higher engineering and selling expenses absorbed part of the incremental revenue, but Satellogic still recorded its first positive operating income and adjusted EBITDA. The comparison for adjusted EBITDA uses the company’s updated methodology, which excludes interest income; the prior-year figure was recast accordingly.

Business and segment performance

Space Systems became the larger business in the quarter, generating $8.8 million of revenue after contributing only $0.5 million a year earlier. Data & Analytics, including Constellation-as-a-Service, also expanded as imagery orders increased.

Operational activity included delivery of the first satellite under Portugal’s $18 million, two-satellite CEiiA program. Satellogic also signed a one-year agreement worth more than $18 million with an international defense customer and a $12 million agreement to transfer an operating satellite to a sovereign defense customer.

Remaining performance obligations totaled $80.7 million at quarter-end. Of that amount, $45.8 million is expected to be recognized within one year, with the balance scheduled over longer periods.

Positive operating profit contrasts with the GAAP net loss

Satellogic’s underlying operations improved even as its reported net loss expanded. Revenue increased by $11.5 million, while the combined increase in cost of revenue, engineering expenses and selling, general and administrative expenses was substantially smaller. Engineering expense rose 32% to $3.1 million, while SG&A increased 61% to $8.6 million because of higher salaries, headcount, stock-based compensation and selling-related travel.

The resulting $0.3 million operating profit was outweighed below the operating line by a $19.7 million non-cash charge from remeasuring secured convertible notes, warrants and earnout liabilities. Consequently, the $20.0 million GAAP net loss did not reflect the same direction as operating income or adjusted EBITDA.

This valuation effect also appears on the balance sheet. Although the principal outstanding on the secured convertible notes declined to $18.0 million from $30.0 million at year-end, their fair-value carrying amount increased to $89.7 million from $56.1 million. During the quarter, $12.0 million of principal was converted into 10.0 million Class A shares.

Cash flow and balance sheet

GAAP operating cash outflow increased to $8.6 million in Q2. However, accounting rules classified $8.3 million of proceeds from an in-orbit satellite sale as investing cash flow. Including those proceeds, the company’s non-GAAP adjusted operating cash flow was nearly neutral at negative $0.3 million.

Free cash flow remained negative at $5.9 million, compared with negative $5.1 million a year earlier, as purchases of property and equipment rose to $5.6 million from $0.8 million. This shows that improved adjusted operating cash flow did not eliminate the cash requirements associated with constellation investment.

Cash and cash equivalents ended the quarter at $112.8 million, up from $94.4 million at December 31, 2025. For the first six months of 2026, the company recorded $32.3 million of financing cash inflow, primarily from $32.8 million in net proceeds from registered direct offerings.

Management perspective

Management attributed the quarter’s move into positive operating income and adjusted EBITDA to revenue growth, operating leverage and continued cost discipline. The expansion of defense and sovereign satellite programs remains central to its commercial strategy.

Satellogic said the first Merlin constellation launch remains scheduled for Q4 2026, with full operational capability expected in the first half of 2027. Management also stated that Merlin is fully funded by existing customer contracts and does not require incremental capital to reach those milestones.

Recent insider transactions

The supplied insider data showed 374,664 shares purchased in 12 transactions and 10,596,590 shares sold in four transactions over the previous six months, resulting in net sales of 10,221,926 shares. The following are the latest entries that included a specific transaction action and reported value; they should not, by themselves, be interpreted as a view on the company’s prospects.

Risks investors should monitor

• Cash conversion remains incomplete. Operating income and adjusted EBITDA were positive, but GAAP operating cash flow and free cash flow remained negative as constellation investment continued.
• Financial instruments can create substantial earnings volatility. Fair-value changes in convertible notes, warrants and earnout liabilities produced a charge much larger than quarterly operating income.
• Contract execution affects revenue visibility. The $80.7 million of remaining performance obligations depends on successful delivery and recognition across sovereign, defense and commercial programs.
• Merlin carries deployment risk. The Q4 2026 initial launch and expected first-half 2027 operational capability depend on production, launch, commissioning and satellite performance.
• Capital structure changes can dilute shareholders. Note conversions and registered direct offerings increased the number of Class A shares while providing funding and reducing note principal.

Summary

Satellogic’s Q2 2026 results marked a meaningful operating shift: rapid Space Systems and Data & Analytics growth produced the company’s first positive operating income and adjusted EBITDA. The main offsets were a fair-value-driven GAAP loss, continued negative free cash flow and reliance on equity and convertible-note transactions. Future results will depend on converting contracted obligations into revenue while executing the Merlin deployment and maintaining operating discipline.