Viasat's Path to Free Cash Flow Positivity: Operational Momentum and the Road to 2027

Viasat Inc. (NASDAQ: VSAT) has long grappled with free cash flow (FCF) challenges, a metric that has swung between modest quarterly gains and steep annual deficits. Data from Macrotrends indicates that while the company posted a positive $60.45 million FCF in Q3 2025, its annual FCF for 2025 plummeted to -$122 million-a stark 85.67% decline from 2024 and a continuation of a multiyear downward trend, according to the Macrotrends free cash flow chart. However, recent operational shifts and capital efficiency initiatives suggest a potential inflection point. The Q2 2026 earnings call revealed a narrowed net loss of $61 million (versus $138 million in Q2 2025) and a quarterly FCF of $69 million, with management explicitly targeting positive FCF by fiscal 2027, according to the Investing.com earnings transcript.

The company's operational momentum appears to stem from a dual focus on cost discipline and capital allocation. CFO Gary Chase emphasized "driving sustained and growing free cash flow" during the Q2 2026 call, outlining plans to reduce leverage and cap capital expenditures at approximately $1.2 billion for the year, according to the Investing.com earnings transcript. These measures reflect a strategic pivot toward capital efficiency, a critical step for a company that has historically struggled with balancing growth investments and liquidity. Adjusted EBITDA growth of 3% year-over-year to $385 million in Q2 2026 further underscores improving operational leverage, according to the Investing.com earnings transcript.

Despite these strides, hurdles remain. The annual FCF remains negative, and Q2 2026 revenue of $1.1 billion-up 2% year-over-year-fell short of forecasts, contributing to a 4.45% post-earnings stock price drop, according to the Investing.com earnings transcript. This highlights the delicate balance Viasat must strike: scaling its satellite communications and cybersecurity segments while tightening cost structures. The company's 2027 FCF positivity target hinges on maintaining this momentum, particularly as it navigates macroeconomic headwinds and competitive pressures in the broadband and defense markets.

For long-term value creation, Viasat's success will depend on its ability to convert operational improvements into durable cash flow generation. The path forward requires disciplined execution on cost management, prudent reinvestment in high-margin segments, and a clear timeline for deleveraging. While the journey is far from complete, the narrowing losses and rising FCF in recent quarters suggest the company is recalibrating its trajectory. Investors, however, will need patience-2027 remains a critical milestone to validate the sustainability of these efforts.