BlackSky's Q2 2025 Earnings Call: Unpacking Key Contradictions in Gen-3 Satellites and Revenue Prospects

Gen-3 satellites and revenue growth, international business growth, Gen-3 imagery quality and performance, Gen-3 capacity and bookings, government spending and budget uncertainty are the key contradictions discussed in BlackSky Technology Inc.'s latest 2025Q2 earnings call.



Revenue Growth and International Expansion:
- BlackSky Technology reported total revenue of $51.7 million for the first half of 2025, up 5.2% over the same period in the prior year.
- Growth was driven by higher professional and engineering services and increased orders from its high-margin Imagery and Analytics business.
- The company experienced significant international growth, with approximately 85% of its funded backlog from international customers for Gen-3 services.

Satellite Launch and Performance:
- BlackSky successfully launched its second Gen-3 satellite, which began delivering high-resolution imagery within just 12 hours after launch.
- With the third satellite in the final testing phase and expected to ship soon, the company remains on track to meet its goal of having six Gen-3 satellites by the end of 2025.
- The rapid commissioning and operational capabilities of the Gen-3 satellites set a new industry standard and contribute to customer demand for BlackSky services.

Backlog and Financial Position:
- The company reported over $350 million in funded backlog, mainly from an international customer base.
- BlackSky's financial position was strengthened by a $185 million 8-year convertible note offering, which provided additional liquidity and improved its balance sheet.
- The funds have supported strategic investments and future growth opportunities, including the acceleration of the Arrow Constellation project.

Government Contracts and Strategic Wins:
- BlackSky won a multiyear contract under the Luno A program valued at up to $24 million with the National Geospatial Intelligence Agency.
- This contract, along with other international defense sector contracts, highlights BlackSky's expertise and capabilities in delivering AI-enabled dynamic monitoring solutions.
- The demand for Gen-3 services is strong, with interest and early access agreements increasing as the satellites demonstrate their performance and capabilities.