Hi, I'm Ryan Koontz. I cover the communications and networking sectors here at Needham. Welcome to our 27th Annual Growth Conference. Super excited to have Gilat Satellite Networks here with us today for our session. We're going to have CFO Gil Benyamini have a short presentation, followed by a fireside between CEO Adi Sfadia, who's with us here as well. So with that, Gil, let's take it away. Thank you, Ryan. Good morning, everyone. Thank you for joining us today for the presentation. Let's start. So I'm the CFO. Adi is our CEO, and together with us is also Mayrav Sher, our Head of IR. A few words about Gilat. So we're a global leader providing solutions for broadband connectivity over satellite. We don't own satellite. We don't build satellite. We provide the ground equipment, the ground segment that allows the transformation of data to and from the satellite. Our equipment and solution include hubs, which are the main servers, modems, antennas, receivers, transceivers, and also management services to provide a whole network, like we do for T-Mobile here in the U.S., where we provide the satellite connectivity and the network management and the products themselves. Our solutions are aimed for a variety of applications. You can see here on the left, on the right, sorry, on the right column. You see more of the mobility applications, like in-flight connectivity, defense, land mobility, trains, and so on, maritime. On the left side, you can see more of the fixed applications: cellular backhauling, government solutions, enterprise solutions, and others. Gilat was founded 37 years ago, so we're in the market for a long time. We're traded dually on NASDAQ and Tel Aviv, a global company, 1,200 employees, 16 sales offices, seven R&D centers, and three network operating centers around the globe. A few words about our customers and our position in the value chain. We have four main groups of customers. First group would be the satellite operators. These are the players that own the satellite and operate the satellites, companies like SES, Intelsat, Eutelsat, and others. These are our most strategic partners. The second group would be service providers and MNOs. And here you see a lot of logos on the list. I'm not going to read them all, but I mentioned T-Mobile here in the U.S., Satcom Direct, an IFC, a service provider for business jets, TIM in Brazil, a lot of MNOs in Japan. You can see some of the names: Docomo, SoftBank, Rakuten, and others, a long list of customers over there. Third group would be system integrators, companies like Boeing, Lockheed Martin, Honeywell, Airbus. And these are integrators that integrate our solution within a bigger one, usually for the defense market, but not only. And the fourth group would be government. It could be governments that subsidize connectivity, like the Peruvian government, which I'll touch on this case study later, or could be direct sales to defense and so on. Looking at our value chain, at the top, we have the satellite manufacturers, companies like Boeing, Thales, Airbus. They get a preorder from the operators. They manufacture, they launch, and then come the satellite operators. The operators, as I said, are the most pivotal players here in the game. They own the satellite, they operate it, and they sell capacity. They sell the capacity to the service providers that provide their services to the end users. So it could be internet connectivity. It could be in-flight connectivity. It could be connectivity for oil and gas, banks, and so on. We fit somewhere in the middle, the ground equipment suppliers, between the satellite operators and the service providers, which I mentioned in the previous slide. We usually sell our main platforms and more of the heavy, I would say, sales to the satellite operators. And we would also sell service providers, the end user terminals, modems, and so on. The case could be different. Sometimes we sell everything to the satellite operator that rents it or sells it to the service provider, but this is the main game. In the last years, we see a lot of, I would say, convergence in the market. We see a lot of M&As, both horizontally and vertically. Just to name a few, Viasat and Inmarsat, two very big satellite operators, merged a couple of years ago. SES and Intelsat merger, which is underway. Gogo and Satcom Direct in the service providers for the IFC that just merged. And we also see it vertically, satellite operators buying service providers and getting closer to the end users. Eutelsat and OneWeb, Intelsat and Gogo Commercial Aviation, and others. For us, it makes the opportunities much bigger at the end of the day. Okay. Looking on the right side, you can see our TAM, and you can see it's growing from $2 billion to $4 billion within this decade, and I'll touch the why in two seconds. At the end of the day, it brings a lot of opportunities, and we focus on three main areas. The first one is VHTS and NGSO constellations. VHTS comes from very high throughput satellites, and NGSO is non-geostationary orbits. Here we see abundance of capacity. Satellites are getting bigger in terms of capacity, and there is a lot of demand in all of the verticals. Second focus area is the IFC, the in-flight connectivity market, a very lucrative market in which we have very nice growth, both organic and inorganic. We've just closed a very large acquisition, which I'll touch in a moment. The third area is the defense market. Again, a very lucrative market, very sticky. We acquired DataPath a year ago, and I'll touch this as well. These are our three main growth drivers. Let's start with the VHTS and the NGSO. We're talking about three layers of satellites: GEO, MEO, and LEO. GEO is the geostationary orbit where satellites are fixed above a certain point on Earth. The nice thing about it is that you don't need to move the antenna in order to get the satellite, like TV satellite services. The antenna doesn't move. The problem here is latency. What we see here is that satellites that used to have one beam over the years started to have dozens of beams, hundreds, and soon it will be even more. We also see software-defined satellites, satellites that don't have to be predefined. And these satellites are going up for 15 years, so you cannot know what will be the demand. And we have a lot of business here. I'll show the platform in the next slide with SES, with Intelsat. Here, every high-throughput satellite or VHTS satellite is tens of millions of opportunity for Gilat. MEO, medium-Earth orbit. There is currently one constellation of SES where Gilat is the sole provider for it. And in the LEO, and Adi will touch it later, there are currently two active constellations: Starlink, which is a closed garden, OneWeb, which we work with, and some prospects like IRIS², the European constellation, where we're in a final stage of bidding, already filed for the RFI, waiting for RFPs. Telesat that we're speaking with, and the last name which we can't mention that we also work with today. We do it with a platform called SkyEdge IV, was designed to cater the variety of application, multi-orbit, and high-capacity constellation. It's been deployed by the large satellite operators, SES, Hispasat, Intelsat, and it's currently the most advanced platform in the market. A few words about the IFC. IFC is a large market. Gilat is a player in all of the relevant components. We provide the ground equipment and modems to Intelsat, transceivers to Honeywell, and the aero antennas to Satcom Direct, and now with the acquisition of Stellar Blu as well. Gilat has about 20% market share in this market. Next year, it will be near $200 million of revenues for Gilat. Last week, we closed the acquisition of Stellar Blu. Adi will touch on it a bit in his presentation, but just a few words. You can see here the picture of the antenna. It's a very low-profile antenna for commercial jets, low SWaP size, weight, and power consumption, low maintenance cost, designed for multi-orbit, with main customers of Intelsat, Panasonic, and Eutelsat, and a lot of new markets to unlock, and we're very, very satisfied with this acquisition. Defense. Defense, again, is a focus area for Gilat. In order to reach growth, we have acquired DataPath a year ago, and this got us into the U.S. DoD. Defense is expected to get to a little bit less than $100 million of revenues this year in Gilat. And this is one of the main growth engines for us as well. Adi will touch on it in his part as well. Last, Peru. Peru is a little bit different business for Gilat. In Peru, we are operating and already constructed terrestrial networks. We've won six regional bids in the country out of 24 areas that we've constructed and now operating. Actually, we're operating five and waiting for the approval to start operating the sixth one. A total agreement of $570 million. Part of it was for the construction, and part of it was for the service for operating it. So Peru is a recurring revenue model country. On top of the network, we provide other services like Wi-Fi connectivity in the villages, cellular backhauling. We have some satellite business in Peru. All in all, Peru has recurring revenues, which are near $50 million this year, with a lot of upside to go. And Gilat today is one of the largest telecom infrastructure companies in Peru. Some financials. So you can see growth in both revenue and EBITDA. Revenue grew from $240-$266 million, and this year expected to grow to anywhere between $305-$315 million. Of course, next year with Stellar Blu, we already gave some ballpark of $120-$150 for Stellar Blu next year. So you can do the math and see that only with that, we're getting into the $450 million area, which is a very, very nice growth in the last years. And EBITDA was $25 million in 2022, $36 million in 2023, and $41-$43 million in 2024. Gilat has a very strong balance sheet. Up until the acquisition, we had no debt. And just before the acquisition, we had more than $115 million of net cash. The debt is negligible. DSOs are very healthy, usually between 60-90 days. We provide cash from operations on an ongoing basis. On top of that, we have some real estate in Israel valued at near $100 million with no debt at the balance sheet that they're at about half. To summarize my part, Gilat is positioned in a very, very unique point in time where there is a lot of demand in the market. We see the satellites getting bigger. The launching costs are decreasing. And the more data transfers over our networks, the more revenues we have. We have the SkyEdge IV platform to support it. We're strongly positioned in the IFC and in the defense market. And we demonstrate growth, profitable growth, and we believe that we'll be able to continue it in the future as well. I'll turn it now to Ryan and Adi. Thank you, Gil. That was a great summary of the company and your business. Adi, some exciting things going on. A lot to talk about here. We could talk for a long time, but let's dive into Stellar Blu. Really transformative acquisition for the company. I'm very excited to hear about all that comes next. Can you kind of give us a background on what drove the deal and what some of your goals are and how it fits in the portfolio? Yeah. So as Gil showed, one of our main growth engines is the in-flight connectivity. And Stellar Blu was a perfect fit for our product portfolio. We do have an internal antenna solution, electronically steered. But the go-to-market and the first-to-market with multi-orbit solution that Stellar Blu gave us gave us a head start. They came with a very large backlog of more than $150 million, started delivering the terminals in Q4. And we expect to see any number between $120-$150 million next year. I think that there is a lot of potential for synergies between the companies. Part of the avionics around the terminal is something that Gilat knows how to do. And we already started to develop some of the parts will drive cost down and increase the future margins. We have a full product portfolio for the in-flight connectivity. We have the ground equipment, what we call the basement. We provide to Intelsat, but recently also to SES. We have the power amplifiers for a mechanical antenna. We have other auxiliary like frequency control unit and power supplies for electronically steered antenna. And now we have the ESA from Stellar Blu. We also develop an internal small LEO-only antenna for Satcom Direct, now part of Gogo. So I believe that together with Stellar Blu, as Gil said, we are going to pass $200 million in revenues in 2025. And it's really exciting. Very exciting, and so in terms of the portfolio, is this a different channel, a different set of customers you're going after, or is maybe the product in a stronger competitive position than what you were doing organically? So in general, I think that the in-flight connectivity market is relatively small in terms of number of players. We have like six or seven large service providers. Intelsat owns around 20%-25% of the market. Panasonic owns another 20%-25%. Starlink right now is not a big player, but they do have a nice backlog. Viasat own around 25%. Hughes is getting into the market, Anuvu. So all in all, we see around six or seven players. We are working with several very large players and provide several different solutions to Honeywell, to their antenna. Now, business aviation becomes more and more a big market, expected to grow from 7,000 or 8,000 aircraft to 10,000 aircraft to 15,000 aircraft in the next five or six years. So there is a lot of potential around it, and we are trying to work with the large players. The fact that Stellar Blu antenna is multi-orbit. It's opened another area for us to work with different customers. Really exciting. And how about the financial impacts in terms of accretion? How should investors think about the acquisition that just closed? So I think that on the accretion, we need to look at two different areas. On a non-GAAP basis, we expect to see positive adjusted EBITDA already in 2025. We said that once Stellar Blu reaches manufacturing stability, during the second half of next year, 2025, we'll see around 10% EBITDA ratio. On a GAAP basis, it's slightly more complicated because on the first two years, we'll have a lot of purchased intangibles amortization, which will drive a significant effect on the EPS. Great. Super. And in terms of backlog, that's an impressive number. You talked about $150 million. What's comprised of that? Can you walk us through some of those customers, and how do you expect that backlog to be delivered over time? Yeah. So Stellar Blu has today three main customers. Intelsat is the largest one, Panasonic, and OneWeb, with a lot of opportunities and pipeline, especially on the aircraft manufacturers' side. The backlog is, as I said, more than $150 million to be delivered in the next 12-18 months. So most of the numbers that we already predicted to 2025 are in the budget, and it's all about delivery. It's not that simple. Stellar Blu delivered up until today around 100 units. There is a production ramp-up that takes time, but we see it progressing on a monthly basis. We believe that soon we will reach to the rate of around 100 units per month, which is, give or take, the full capacity of two shifts of manufacturing. Okay. Wow. They must have been at this for quite a while to build that kind of backlog. Can you kind of walk through their sales and go-to-market and what a typical sales cycle is like for this new type of product? Is it different from how you've traditionally sold? Yeah. No, I think that the go-to-market is, give or take, the same. Both us and Stellar Blu are working with the service providers. So in order to win a deal, you need to be the preferred vendor for a service provider like Intelsat or Panasonic. Usually, the RFPs from the airline arrive once every few years, but you have several airlines that are bidding on a yearly basis, especially when they buy a new chunk of aircraft. They usually open the stage for another RFP process. Another important go-to-market is the aircraft manufacturing, like Boeing and Airbus. To be a line-fit terminal is extremely important. That means that you have like 10 or 15 years of horizons of orders where the airline orders the aircraft with the antenna built in. It's part of their financing agreement, so it's much easier. Stellar Blu is already working with Airbus on a teaming agreement for line fit. Sorry, with Boeing on teaming agreement on line fit. And we really hope to add Airbus as a customer sooner than later. We know that recently Airbus stopped their Ku program with Safran. And we really hope that now that the main non-Starlink vendors on Ku that are available today in the market, Intelsat and Panasonic, the fact that they are working with Stellar Blu gives us the optimism that Airbus will choose Stellar Blu antenna for line fit as well. Absolutely. And can you walk us through maybe the competitive landscape a little bit for Stellar Blu? Obviously, Starlink is vertically integrated, I believe. And who else is out there that you would compete with? Starlink is a closed garden. So in order to use their capacity, you need to have their terminal and modems. Stellar Blu is an independent antenna provider. And their offering is very compelling, both to the airline and to the service provider. And most of the competition, once you get partnership with the service provider, most of the competition is indirect, where Intelsat and Panasonic compete against Viasat, HNS, Anuvu, and Starlink. Great. How about other opportunities outside of commercial jets? Are there other opportunities for the technology from Stellar Blu? Yeah. There are several other opportunities, of course. The way that the terminal of Stellar Blu is built, they can relatively fast redesign a different type of antenna, for example, for business aviation, a smaller antenna. And so business aviation is a large opportunity. Going to land mobility, defense application, both on unmanned aerial vehicles or combat aircraft, also land mobility in the commercial world, like trains. So there is a lot of opportunities around it. And our earn-out with Stellar Blu is built in a way that if they get an award that extends the overall market potential for Gilat, they will get part of their earn-out. Got it. Yeah. Can you walk us through a little more balance sheet mechanics there in terms of the deal? You've got cash. You paid some upfront. So the deal is built in a way that we paid upfront $98 million. Another $29 million is dependent on delivery of the number of units and agreed upon margins for 12 months. Another $19 million is increasing the backlog or doubling the new orders within 18 months, meaning until the end of 2025. And another $99 million is up to four strategic agreements. Strategic agreement is like line-fit with Airbus, is like penetrating to the DoD, is like selling the antenna to Starlink, which we believe that we know that the DoD is looking for a Ku antenna that will be one antenna that will support all vendors. And I think we are highly competitive in this area because Starlink doesn't have antennas that work with geostationary satellites. Our antenna can work both on LEO and GEO. And with relatively small software integration, can work also on Starlink. So I think we are well positioned to capture such a market share. From a balance sheet perspective, as Gil said, we closed the year with slightly below $120 million in net cash. We also secured a $100 million credit facility from HSBC and Hapoalim Bank in Israel. We used for the first payment $60 million out of this credit facility. And in addition, we generate around $25-$30 million cash from operation every year. So we don't see a problem of cash flow to pay the earn-out. We also own buildings in Israel that are worth between $90-$100 million with a book value of around $50 million. So if we need to do a sale and lease back, it's something that we can always consider. And we really hope that we'll reach to a point that we'll need to pay all the earn-out. That means that revenue will be significantly higher than $200 million per year, just from this acquisition. Fantastic. So you've been in this industry a long time. I mean, how do you see the IFC market in terms of LEOs versus GEOs and kind of the growth trajectory here? I mean, I assume we're still at a relatively early stage, I mean, with LEOs, right? And I think you're going to see a nice refresh opportunity globally. Yeah. So there is always a debate what is better, LEO only or multi-orbit. We at Gilat believe that multi-orbit allows the service provider much more flexibility. Not all applications need low latency, which is relatively relevant for online gaming. And I guess when you are flying, not doing online gaming, if you are doing streaming, GEO is more than sufficient. And I think that the fact that Stellar Blu antenna can do both LEO and GEO and quickly shift between constellation and satellites offers something that others don't have these days. The next version of the antenna will be able to do simultaneously two satellites, either two LEOs or one LEO and one GEO, what Starlink is doing today. For example, they put two antennas on an aircraft in order to reach the same bandwidth that Stellar Blu terminal can reach today. Tomorrow, we can even double it with a dual beam or dual satellite solution. I believe that multi-orbit is much better. With the backlog that we have, we will show that to the market. Awesome. And can you kind of explain a little bit your relationship with OneWeb? Yeah. On the LEO side, so OneWeb launched their constellation a few years ago, then went bankrupt, bought by the UK Space Agency and Bharti, and later on merged into Eutelsat. Their Gen 1 is, I would say, more than 10 years designed already. They would like to replace it with a next-generation satellite, what internally they called Gen 2, which will include inter-satellite links and will affect them to utilize the capacity of the constellation much better. We were shortlisted as one of the ground equipment providers and integrators for Gen 2, very advanced with the negotiation with them. But then recently, they got the IRIS² award as part of a SpaceRISE Consortium together with Eutelsat, sorry, together with SES and Hispasat. They decided to postpone their decision until we see what are the synergies that they have between IRIS and OneWeb. So we believe that they will take a decision before the mid of the year. And we don't see them not going to Gen 2. It's all about the synergies between the two. And I think we are well positioned with OneWeb. And we know that we gave them a very attractive offer. And we are significantly less risky than the other provider. I think at the Gen 1, they're still in the process of really turning up that whole global coverage, right, with ground station build-outs. Yeah. So I think that we are working with them on the ground station. We are delivering them power amplifiers. It was a deal of more than $70 million, with most of it was delivered. Now we are getting spare parts ordered, so it's insignificant. They recently contracted with Boeing a launch of another 100 satellites. Just to maintain LEO satellites, every five years, you need to replace 20% of the constellation. That's the difference between LEO and GEO, where in GEO, you have real estate in space for 15 or 17 years. So in order not to lose the global coverage, they need to launch another 100 satellites in the next two years. Yeah. Incredible. Maybe shift in talking about your SkyEdge IV platform, which is really kind of the focus of your ground station business. Can you elaborate on that, kind of how that fits into that segment and the opportunities there? Is this primarily for new ground station builds, or are you also adapting existing kind of customer infrastructure? It's a combination of new ground station builds for new GEO and MEO satellites. It was built and designed to meet the needs of SES and Eutelsat, both for MEO constellation, the O3b mPOWER of SES, and Eutelsat constellation. Basically, it fits to every new geostationary satellite that is being launched. What we see today in the market, the three largest satellite manufacturers, Boeing, Thales, and Airbus, are having some development delays. Actually, since COVID started, they are facing some delays. In addition, there is a shortage or lack of launch capacity. SpaceX is launching Starlink satellites. The Russian launch capacity is not available because of the sanctions. It is not that easy to schedule a satellite launch. We believe that this hurdle will be over towards the mid of next year, 2026. And every order of new satellites, it's a potential of several tens of millions of dollars for Gilat. We continue to grow with Eutelsat and SES. They're very large customers. SES is planning to launch around 10 to 12 satellites, MEO satellites every year. Every satellite means that they need more capacity. SkyEdge IV is built in a way that it's more of a license-based than a hardware-based. So for example, for Eutelsat, once they put the SkyEdge IV in the network, most of the growth, unless they need another gateway, most of the growth will be in licenses. So it will increase our margins as well. Absolutely. And Gil talked a lot about the importance of the government and military business. And you had the acquisition last year of DataPath. Can you expand on the strategic value there and where you guys are headed? So around 10 years ago, Gilat suffers from a lot of losses, and we decided to abandon the investment in the government and defense market. About two years ago, we decided to return and invest. In 2025, we are significantly shifting resources to the defense and increasing our investments. We thought that the best way to penetrate to the U.S. DoD, which is, I would say, 80% of the overall defense satcom market is in the U.S., the best way to penetrate is to acquire an integrator. And that's what we did with DataPath. And I think that the acquisition itself is satisfying. We expected they will deliver $45 million and be break-even in 2024. And they delivered more than $50 million with small EBITDA this year. And we expect them to more than double their revenues in the next three years. We are very excited from penetrating the defense. We are investing in new modems. Also, the SkyEdge IV is a perfect fit for defense application. We have a discussion with SES to use our modems with their mPOWER deployment. We comply with all the FAR and DFARS regulation. Soon, we are adding a lot of security features like TRANSEC and FIPS that will be required by the U.S. DoD. That's great. You've talked about, I think, some cross-selling too between your traditional Gilat products and DataPath. You're starting to see some progress. So yeah, DataPath used to be a Wavestream customer. Wavestream is a solid-state power amplifier provider company in California. So we started to see some synergies where customers are approaching DataPath to buy Wavestream solutions. We also find a lot of synergies between Gilat and DataPath starting to integrate our modems with their terminal solution. And already started to pitch this to the DoD. For years, we tried to penetrate to the DoD without success, even to set a meeting. And this year, we already started to have a lot of meetings with the DoD reviewing our solutions. So it seems promising. Great. Fantastic. Well, anything you want to say in wrapping up, Adi? We're just about out of time here. Thank you very much. Wrap up. To wrap up? Yeah. I think it's exciting times for Gilat. We figured out it will be not that easy to grow organically because of the fact that Airbus, Thales, and Boeing are not delivering satellites. So we decided to focus on inorganic growth. We acquired DataPath and closed last week a very promising acquisition of Stellar Blu. We expect to be significantly above $400 million next year and increase our profitability. We expect to more than double our revenues in the defense. Gil mentioned that it was close to $100 million in 2024. So we expect to be well above $200 million in three to four years. Really exciting times. Thank you very much. Appreciate it. Thank you. Thank you for joining. Thank you.