Comtech Telecommunications 2025 Q4 Earnings Turnaround Driven by 108.7% Net Income Surge

Comtech Telecommunications reported Q4 2025 earnings that exceeded expectations, with revenue rising 3.3% to $130.37 million and a non-GAAP EPS of -$0.25, outperforming forecasts by $0.19. The company also provided preliminary Q1 2026 guidance, projecting improved net sales and operating cash flow compared to the prior year.

Revenue

Comtech’s total revenue for Q4 2025 reached $130.37 million, a 3.3% increase from $126.19 million in Q4 2024. The Satellite & Space Communications segment reported $69.0 million in revenue, while the Allerium segment (formerly Terrestrial & Wireless Networks) contributed $61.3 million. These figures reflect sequential improvements in sales and operational efficiency, driven by strategic realignment and contract transitions.

Earnings/Net Income

The company narrowed its loss to $0.39 per share in Q4 2025 from $3.50 per share in Q4 2024, an 88.8% improvement. Net income surged to $7.91 million, reversing a $90.78 million loss in the prior year. The non-GAAP EPS of -$0.25, though negative, outperformed expectations, signaling a meaningful operational turnaround. This positive swing underscores Comtech’s progress in stabilizing its financial health.

Post-Earnings Price Action Review

The strategy of buying Comtech shares after its Q4 revenue growth and holding for 30 days has historically shown promising returns, with a 29.46% increase in shares over three years.

Despite a 6.25% drop in stock price during the latest trading day, the company’s long-term outlook remains bolstered by improved cash flow and strategic initiatives.

CEO Commentary

Kenneth Traub highlighted Comtech’s transformation, noting a $11.4 million operating cash flow in Q4 2025 versus a $21.8 million deficit in Q1 2025. Liquidity improved to $47 million as of July 31, 2025, and gross margins rose to 31.2%. Traub emphasized the “flywheel effect” of operational and relationship improvements, though challenges like government shutdown impacts persist.

Guidance

For Q1 2026, Comtech projects net sales of $107–$113 million and operating cash flow of $6–$7 million, compared to $115.8 million and -$21.8 million in Q1 2025. The company expects sequential growth in fiscal 2026, driven by Allerium’s international expansion and satellite production advancements.

Additional News

Comtech rebranded its Terrestrial & Wireless Networks segment as Allerium, emphasizing its commitment to public safety solutions. A $130 million+ multiyear contract with a leading U.S. wireless provider underscores Allerium’s leadership in emergency communications. Additionally, the company announced a $35 million subordinated term loan to enhance liquidity and flexibility during its transformation.