MDA Space Ltd (MDA) Q2 2026 Earnings Report

The call conveys a strongly positive operational and strategic momentum: high revenue growth (Q2 +34% YoY), raised guidance, robust bookings (book-to-bill 1.6x), major contract wins (Telesat expansion, CSA RADARSAT, others), and transformational M&A (BCT, CLS) that materially expand capabilities and pro forma scale. Near-term financial headwinds include working-capital-driven negative operating cash flow and free cash flow, higher CapEx, dilution from equity issuance and acquisition-related financing/leverage risks. Management emphasizes disciplined financing, conservative leverage targets, and continued organic growth, while acknowledging near-term cash impacts. On balance, the call highlights significant growth and strategic advances while flagging manageable near-term cash and execution risks.

MDA updated 2026 guidance to revenue of $1.8–$1.9 billion (midpoint $1.85B, ~13% y/y at midpoint) and adjusted EBITDA of $330–$370M (midpoint $350M, ~8% y/y), with an unchanged adjusted EBITDA margin target of 18–20% and CapEx guidance of $225–$275M; free cash flow is expected to be neutral-to-negative. For context, Q2 revenue was $499M (+34% y/y) with adjusted EBITDA $96M (19.3% margin), H1 revenue was $963M (+33% y/y) with H1 adjusted EBITDA $187M (19.4% margin), Q2 adjusted net income was $52M and adjusted diluted EPS $0.36. Backlog was $4.0B (Q2 net bookings >$800M, book-to-bill 1.6x) — pro forma backlog would be $4.4B after the ~ $400M Telesat expansion — and the opportunity pipeline is ~$40B (including ~$10B down-selected follow‑ons). H1 CapEx was $145M (vs $98M LY); operating cash flow H1 was negative $33M (vs +$320M LY) and free cash flow negative $178M (vs +$222M LY). Balance sheet and financing: net cash $153M at quarter end, total liquidity ~$1.1B (~$400M cash + ~$700M credit); management completed ~$1.75B financing (23M‑share bought deal raising $1.15B and $600M senior notes) toward two acquisitions (total ~ $2B cost), which would lift pro forma 2026 revenue to ~$2.5B and, management said, support roughly ~50% growth into 2027 while targeting pro forma leverage of 1.5x–2.5x net debt to LTM adjusted EBITDA.