Gilat's Strategic Expansion in Latin America: A Model for Sustainable Connectivity and Investment Growth

In an era where digital infrastructure is no longer a luxury but a necessity, companies that bridge the gap between technology and underserved markets are capturing both social and financial value. Gilat Satellite Networks, a global leader in satellite-based communications, has positioned itself at the forefront of this movement through its recent $25 million contract in Peru. This deal, part of a broader strategy to expand its footprint in Latin America, underscores how long-term government partnerships can generate recurring revenue while advancing critical digital inclusion goals.

The Peru Contract: A Blueprint for Scalable Impact

Gilat's agreement with Pronatel, Peru's national telecommunications program, is more than a financial win—it's a masterclass in aligning corporate strategy with public-sector needs. The 12-month implementation phase to modernize Cusco's Regional Broadband network will be followed by a five-year service delivery period, creating a predictable revenue stream that extends into 2030. This structure is a hallmark of Gilat's approach: short-term execution paired with long-term monetization.

The project's scope is equally compelling. By delivering 200 Mbps high-speed internet to 208 public institutions—including schools, health centers, and police stations—Gilat is addressing the core pillars of rural development. The addition of 69 public WiFi hotspots further amplifies the project's reach, ensuring that communities in some of Peru's most remote areas gain access to essential services and economic opportunities. For investors, this dual focus on institutional and consumer connectivity highlights Gilat's ability to scale its solutions in a way that aligns with global trends toward universal broadband access.

Recurring Revenue and Regional Dominance

One of the most attractive aspects of this deal is its financial structure. Unlike one-off infrastructure contracts, the five-year service period creates a recurring revenue model that insulates Gilat from the volatility of short-term projects. This stability is particularly valuable in emerging markets, where regulatory uncertainty and macroeconomic fluctuations can deter traditional investors.

Moreover, the contract builds on Gilat's existing infrastructure and operational expertise in Peru. By leveraging its decade-long partnership with the Peruvian government, the company avoids the high costs and risks associated with entering new markets. This “flywheel effect”—using established relationships to secure incremental contracts—positions Gilat to dominate the Latin American rural connectivity space. The region, home to over 650 million people, remains one of the most underserved in the world, with only 60% of the population having consistent internet access. For Gilat, this represents a vast, untapped market.

Strategic Alignment with Global Megatrends

The Peru project also reflects a broader shift in how governments and corporations approach digital inclusion. As the International Telecommunication Union (ITU) pushes for universal connectivity by 2030, companies that can deliver scalable, cost-effective solutions in hard-to-reach areas will gain a competitive edge. Gilat's satellite-based technology is uniquely suited to this challenge, bypassing the need for costly terrestrial infrastructure in mountainous or sparsely populated regions.

This alignment with global megatrends isn't lost on investors. The rural connectivity market, valued at over $10 billion in 2025, is projected to grow at a compound annual rate of 12% through 2030. Gilat's ability to secure multi-year contracts with governments—while maintaining margins above 30% in recent projects—positions it as a key player in this expansion.

Investment Implications and Risks

For investors, the Peru contract offers several compelling angles. First, it provides visibility into future earnings, a rare commodity in the satellite communications sector. Second, it reinforces Gilat's reputation as a reliable partner for governments, which could lead to follow-on contracts in other Latin American countries. Finally, it demonstrates the company's technical capability to deliver high-speed services in challenging environments—a differentiator in a market where reliability is paramount.

However, risks remain. Regulatory changes in Peru or other Latin American countries could disrupt project timelines. Additionally, while satellite-based solutions are effective, they face competition from terrestrial 5G rollouts in urban areas. That said, Gilat's focus on rural and remote regions—a niche where 5G is unlikely to penetrate—mitigates this risk.

Conclusion: A Win-Win for Investors and Communities

Gilat's Peru contract is a microcosm of its broader strategy: leveraging long-term government partnerships to generate recurring revenue while advancing digital inclusion. For investors, this model offers a rare combination of social impact and financial predictability. As the global push for universal connectivity accelerates, companies like Gilat that can deliver scalable, sustainable solutions in underserved markets will likely outperform peers focused solely on urban or developed economies.

In the coming years, the success of projects like this one in Cusco will be a litmus test for Gilat's ability to replicate its model across Latin America. If executed effectively, the company could emerge not just as a regional leader, but as a blueprint for how technology can drive both profit and progress.