Iridium's revenue rose, operating profit fell by more than half, and net profit nearly tripled

Iridium Communications, a US satellite communications operator, reported Q3 2026 revenue of USD 246m, up 8.3% on Q3 2025. Operating profit went the other way and fell to USD 31.6m from USD 70.1m. The operating margin narrowed by 18.0 pp to 12.9%, against 30.9% a year earlier. Net profit still rose to USD 107m from USD 37.1m, which lifted the net margin to 43.5%. Two lines moved in opposite directions, and the gap between them is large.

A satellite network carries heavy fixed costs, and depreciation is one of them: it reached USD 62.1m in the quarter, up from USD 53.0m. When revenue grows slowly and such costs grow faster, operating profit shrinks. A net profit far above operating profit tells me something outside normal operations contributed, and the accounts do not say what. I would not read the net result as a sign of better trading. EBITDA, which adds depreciation back, fell 23.8% to USD 93.7m. The core business earned less, and the bottom line says otherwise.