LeoStella’s factory in Tukwila, Washington. Photo: LeoStella

Ahead of launching the first satellites in its Gen-3 constellation upgrade, BlackSky fully acquired small satellite manufacturer LeoStella. BlackSky announced the move in its third quarter investor call on Nov. 7, along with 6% revenue growth and a strong quarter of contract wins. 

LeoStella was a 50-50 joint venture between BlackSky and Thales Alenia Space. The small satellite manufacturer based in Washington state builds BlackSky’s satellites. 

“BlackSky acquired our partner’s stake in LeoStella to help optimize the Gen-3 supply chain and production operations,” said Lyn Chassagne, BlackSky senior vice president of Marketing & Customer Experience.

The Gen-3 satellite constellation will offer higher frequency monitoring and 35 cm resolution when launched. The first Gen-3 satellite is completing final testing and expected to ship to Rocket Lab’s launch site in New Zealand within the next few weeks, CEO Brian O’Toole told investors on Thursday. 

BlackSky has also raised more than $45 million in growth capital to fully fund the baseline Gen-3 constellation upgrade. 

O’Toole said BlackSky is in the process of incorporating optical inter-satellite link (OISL) terminals into the Gen-3 design. The company has been awarded multiple contracts with U.S. government customers who want to explore integrating OISL terminals into Gen-3 satellites. 

“The objective is to be compatible with both the Space Development Agency’s Transport Layer and commercial space transport layers,” O’Toole said. “Once operational, we expect delivery timelines to improve by 10 times, further reducing the already low-latency delivery of our imagery and analytic services that we are delivering today.”  

Q3 Results 

BlackSky posted a near-record of $780 million in new contract awards during the third quarter. O’Toole told investors this was one of the strongest quarters of bookings in the past two years, driven by demand from defense and intelligence agencies for high-frequency imagery and advanced analytics.  

BlackSky reported third quarter revenue of $22.5 million, up 6% year-over-year. Year-to-date the company has posted 22% revenue growth. 

Most of BlackSky’s revenue is in imagery and software analytical services revenue. This accounted for $17.3 million in the third quarter, up 13% year-over-year.

Professional & engineering services revenue was $5.3 million during the quarter, down from $6 million in the year-ago period. 

Net loss for the third quarter of 2024 was $12.6 million, compared to a net income of $0.7 million in the third quarter of 2023. BlackSky said this change was driven by fluctuations in equity warrants and other equity instruments. 

BlackSky improved adjusted EBITDA during the third quarter, reporting $700,000 in adjusted EBITDA, compared to an adjusted EBITDA loss of $400,000 in the third quarter of 2023. This improvement was driven by higher revenues and improved gross margins. It was the fourth consecutive quarter of positive adjusted EBITDA. 

The company maintained its outlook for full year 2024 revenue of between $102 million and $118 million, and full year 2024 adjusted EBITDA of between $8 million and $16 million.