Iridium Communications Inc. (IRDM)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion along with our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed on February 12, 2026 (our “2025 Form 10-K”) with the SEC, as well as our condensed consolidated financial statements included in this Form 10-Q.

This Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Such forward-looking statements include those that express plans, anticipation, intent, contingencies, strategies, goals, targets or future developments, market trends, expected competition or otherwise are not statements of historical fact. Without limiting the foregoing, the words “believe,” “anticipate,” “plan,” “expect,” “intend” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on our current expectations and projections about future events, and they are subject to risks and uncertainties, known and unknown, that could cause actual results and developments to differ materially from those expressed or implied in such statements. The important factors described under the caption “Risk Factors” in our 2025 Form 10-K, as updated and supplemented by this Form 10-Q, could cause actual results to differ materially from those indicated by forward-looking statements made herein. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Overview of Our Business

We are a leading provider of global voice, data and positioning, navigation and timing (“PNT”) satellite services and are the only commercial provider of communications services offering true global coverage, connecting people, organizations, and assets to and from anywhere, in real time. Our low-earth orbit (“LEO”), L-band network provides specialized, reliable, weather-resilient communications services to regions of the world where terrestrial wireless or wireline networks do not exist or are limited, including remote land areas, open ocean, airways, the polar regions and regions where the telecommunications infrastructure has been affected by political conflicts or natural disasters. In addition, our satellites have other payloads that facilitate specific additional services for customers, such as our subsidiary Aireon LLC’s space-based air traffic surveillance system. We also utilize our long history operating a commercial LEO satellite system to provide a growing array of engineering and operational services to government customers and government network operators such as the U.S. Space Force.

Our primary business is to provide voice and data communications services to businesses, U.S. and foreign governments, non-governmental organizations and consumers via our satellite network, which has an architecture of 66 operational satellites with in-orbit spares and related ground infrastructure. We utilize an interlinked mesh architecture to route traffic across the satellite constellation using radio frequency crosslinks between satellites. This architecture minimizes the need for ground facilities to support the constellation, which facilitates the global reach of our services and allows us to offer services in countries and regions where we have no physical presence.

We primarily sell our products and services to commercial end users by recruiting and expanding a global wholesale distribution network, currently encompassing approximately 120 service providers, approximately 320 value-added resellers (“VARs”), and approximately 100 value-added manufacturers, which create and sell technology that uses the Iridium network either directly to the end user or indirectly through other service providers, VARs or dealers. These distributors often integrate our products and services with other complementary hardware and software and have developed a broad suite of applications using our products and services to target specific industries or business areas. We expect that demand for our services will increase as more applications are developed and deployed that utilize our technology.

As of June 30, 2026, we had approximately 2,627,000 billable subscribers worldwide, an increase of 144,000, or 6%, from approximately 2,483,000 billable subscribers as of June 30, 2025. We have a diverse customer base, including end users in land mobile, Internet of Things (“IoT”), maritime, aviation and government.

Aireon Acquisition

On May 13, 2026, we entered into a Securities Purchase Agreement with NAV CANADA, the Irish Air Navigation Service, ENAV S.P.A., Naviair Surveillance A/S, NATS (Services) Limited, and certain of their affiliated entities (the “Sellers”), pursuant to which, on July 2, 2026 (the “Aireon Closing Date”), we, through our wholly owned subsidiary, Iridium Monitor Holdings LLC (“Iridium Monitor Holdings”), closed our acquisition of Aireon Holdings LLC (“Aireon Holdings”), acquiring the remaining 60.5% of equity interests in Aireon Holdings that we did not already own (the “Aireon Closing”).

We now indirectly own all of the membership interests in Aireon Holdings and its subsidiary Aireon LLC (“Aireon”), which is the operator of the world’s only space-based ADS-B air traffic surveillance system. We acquired the additional equity interest for approximately $366.7 million, 50% in cash and 50% deferred and in the form of a loan by the Sellers, payable one year following the Aireon Closing pursuant to a Credit and Guaranty Agreement. We view this acquisition as a defining step toward achieving our long-term business objective to provide the foundational architecture for global aviation safety, bringing space-based surveillance, safety communications, PNT, and operational data together on a single network.

20

Anticipated Merger with Rocket Lab Corporation

On June 28, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Rocket Lab Corporation (“Rocket Lab”), pursuant to which we agreed to be acquired by Rocket Lab (the “Transaction”).

Subject to the terms and conditions set forth in the Merger Agreement, each issued and outstanding share of our common stock, other than as specified in the Merger Agreement, will be converted into the right to receive (i) $27.00 in cash and (ii) a number of shares of Rocket Lab’s common stock equal to the Exchange Ratio (as defined below). The “Exchange Ratio” will be the following: (i) if the Rocket Lab Common Stock Price (as defined below) is equal to or less than $67.50, then the Exchange Ratio will be 0.4000; (ii) if the Rocket Lab Common Stock Price is greater than $67.50 but less than $112.50, then the Exchange Ratio will be the quotient obtained by dividing $27.00 by the Rocket Lab Common Stock Price, rounded to four decimal places; and (iii) if the Rocket Lab Common Stock Price is equal to or greater than $112.50, then the Exchange Ratio will be 0.2400. “Rocket Lab Common Stock Price” is defined as the volume weighted average price per share of Rocket Lab’s common stock on the Nasdaq Global Select Market for the period of the ten consecutive trading days ending on and including the second full trading day prior to the First Effective Time (as defined in the Merger Agreement).

The Merger Agreement provides each of us and Rocket Lab with certain termination rights and, under certain circumstances, may require us to pay a $223.6 million termination fee.

Our Board of Directors unanimously approved the Merger Agreement and resolved to recommend that our stockholders approve the adoption of the Merger Agreement and the Transaction. In addition, each of our directors holding shares of our common stock has entered into a voting agreement to support the Transaction.

The Transaction is expected to be completed in mid-2027, subject to the satisfaction of customary closing conditions, including (i) the adoption of the Merger Agreement and the Transaction by the affirmative vote of the holders of a majority of our outstanding common stock; (ii) the expiration or termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and consent of the U.S. Federal Communications Commission to the transfer of control of certain of our telecommunication authorizations; (iii) receipt of clearances or approvals under other specified foreign investment and satellite and telecommunications laws; (iv) the absence of any order or law issued, enforced or enacted by a governmental authority in certain specified jurisdictions that prevents, makes illegal or enjoins the consummation of the Transaction; (v) there having not occurred a Company Material Adverse Effect or a Parent Material Adverse Effect, each as defined in the Merger Agreement; and (vi) the effectiveness of a registration statement on Form S-4 with respect to shares of Rocket Lab Common Stock to be issued in the Transaction and approval of such shares for listing on the Nasdaq Global Select Market. The Merger Agreement also subjects us to interim operating covenants that generally require us to conduct our business in the ordinary course consistent with past practice and preserve our business organization, key personnel, customer and business relationships, and material assets, and restrict us from or limit us in taking certain actions, including amending our organizational documents; issuing or repurchasing equity securities; declaring dividends or distributions; pursuing acquisitions, dispositions or significant investments; incurring material indebtedness or capital expenditures; entering into, terminating or materially modifying certain significant contracts; taking certain actions with respect to employee compensation and benefit arrangements, accounting, and tax matters; settling material litigation; and taking certain actions affecting our satellite operations, telecommunications permits, or other material assets.

For more information regarding the Transaction and related arrangements, see the Current Report on Form 8-K that we filed on June 29, 2026.

21

Material Trends and Uncertainties

Our industry and customer base have historically grown as a result of:

•demand for remote and reliable mobile communications services;

•a growing number of new products and services and related applications;

•a broad wholesale distribution network with access to diverse and geographically dispersed niche markets;

•increased demand for communications services by disaster and relief agencies, emergency first responders, businesses and consumers;

•improved data transmission speeds for mobile satellite service offerings;

•regulatory mandates requiring the use of mobile satellite services;

•a general reduction in prices of mobile satellite services and subscriber equipment; and

•geographic market expansion through the ability to offer our services in additional countries.

Nonetheless, we face a number of challenges and uncertainties in operating our business, including:

•our ability to maintain the health, capacity, control, and level of service of our satellites;

•our ability to develop and launch new and innovative products and services;

•changes in general economic, business, and industry conditions, including the effects of currency exchange rates;

•our reliance on a single primary commercial gateway and a primary satellite network operations center;

•increased competition or potential competition from other satellite service providers, including SpaceX following its announced plans to acquire a significant amount of spectrum enabling global direct-to-device (“D2D”) services, and, to a lesser extent, from the expansion of terrestrial-based cellular phone systems and relat

[Excerpt truncated for page length; source filing is linked above.]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

A discussion regarding our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on February 13, 2025.

Overview of Our Business

We are a leading provider of global voice, data and positioning, navigation and timing (PNT) satellite services and are the only commercial provider of communications services offering true global coverage, connecting people, organizations and assets to and from anywhere, in real time. Our low-Earth orbit, L-band satellite network provides reliable, weather-resilient communications services to regions of the world where terrestrial wireless or wireline networks do not exist or are limited, including remote land areas, open ocean, airways, the polar regions and regions where the telecommunications infrastructure has been compromised by political conflicts or natural disasters.

We provide voice and data communications services to businesses, U.S. and foreign governments, non-governmental organizations and consumers via our satellite network, which has an architecture of 66 operational satellites with in-orbit spares and related ground infrastructure. We utilize an interlinked mesh architecture to route traffic across the satellite constellation using radio frequency crosslinks between satellites. This unique architecture minimizes the need for ground facilities to support the constellation, which facilitates the global reach of our services and allows us to offer services in countries and regions where we have no physical presence.

In 2024, we acquired Satelles, Inc. (Satelles), a provider of highly secure, satellite-based PNT services that complement and protect GPS and other Global Navigation Satellite System reliant systems. Time synchronization and location data play an important role in the global economy, particularly for major industries supported by critical infrastructure, such as financial services, telecommunications, cybersecurity and transportation. We believe this acquisition has the potential to generate substantial growth in our service revenue, as well as incremental equipment and engineering services revenue over the coming years from both government and commercial customers.

We sell our products and services to commercial end users through a wholesale distribution network, encompassing approximately 120 service providers, 310 value-added resellers (VARs), and 90 value-added manufacturers (VAMs), which either sell directly to the end user or indirectly through other service providers, VARs or dealers. These distributors often

45

integrate our products and services with other complementary hardware and software and have developed a broad suite of applications for our products and services targeting specific lines of business.

At December 31, 2025, we had approximately 2,537,000 billable subscribers worldwide, an increase of 77,000, or 3%, from approximately 2,460,000 billable subscribers at December 31, 2024. We have a diverse customer base, including end users in land-mobile, Internet of Things (IoT), maritime, aviation and government.

We recognize revenue primarily from the provision of services and the sale of equipment. Service revenue represented 73% and 74% of total revenue for the years ended December 31, 2025 and 2024, respectively. Voice and data, IoT data and broadband service revenues have historically generated higher margins than subscriber equipment revenue, and we expect this trend to continue. We also recognize revenue from our hosted payloads, principally from Aireon, including fees for hosting the payloads and fees for transmitting data from the payloads over our network, as well as revenue from other services, such as satellite time and location services.

Material Trends and Uncertainties

Our industry and customer base have historically grown as a result of:

•demand for remote and reliable mobile communications services;

•a growing number of new products and services and related applications;

•a broad wholesale distribution network with access to diverse and geographically dispersed niche markets;

•increased demand for communications services by disaster and relief agencies and emergency first responders;

•improved data transmission speeds for mobile satellite service offerings;

•regulatory mandates requiring the use of mobile satellite services;

•a general reduction in prices of mobile satellite services and subscriber equipment; and

•geographic market expansion through the ability to offer our services in additional countries.

Nonetheless, we face a number of challenges and uncertainties in operating our business, including:

•our ability to maintain the health, capacity, control and level of service of our satellites;

•our ability to develop and launch new and innovative products and services;

•changes in general economic, business and industry conditions, including the effects of currency exchange rates;

•our reliance on a single primary commercial gateway and a primary satellite network operations center;

•increased competition or potential competition from other satellite service providers, including SpaceX following its recently announced plans to acquire a significant amount of spectrum enabling global D2D services, and, to a lesser extent, from the expansion of terrestrial-based cellular phone systems and related pricing pressures;

•market acceptance of our products;

•regulatory requirements in existing and new geographic markets;

•challenges associated with global operations, including as a result of conflicts in or affecting markets in which we operate;

•rapid and significant technological changes in the telecommunications industry, including announced plans for global satellite D2D broadband services;

•our ability to generate sufficient internal cash flows to repay our debt;

•reliance on our wholesale distribution network to market and sell our products, services and applications effectively;

•reliance on a global supply chain, including single-source suppliers for the manufacture of most of our subscriber equipment and for some of the components required in the manufacture of our end-user subscriber equipment and our ability to purchase component parts that are periodically subject to shortages resulting from surges in demand, natural disasters or other events, including a global pandemic; and

•reliance on a few significant customers, particularly agencies of the U.S. government, for a substantial portion of our revenue, as a result of which the loss or decline in business with any of these customers may negatively impact our revenue and collectability of related accounts receivable, including as a result of an extended government shutdown or the use of continuing resolutions.

46

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP). The preparation of these financial statements requires the use of estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, income taxes, useful lives of property and equipment, loss contingencies, and other estimates. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

The accounting policies we believe to be most critical to understanding our financial results and condition and that require complex and subjective management judgments are discussed below. Our accounting policies are more fully described in Note 2 to the consolidated financial statements included in this report.

Income Taxes

We account for income taxes using the asset and liability approach. This approach requires that we recognize deferred tax assets

and liabilities based on differences between the financial statement bases and tax bases of our assets and liabilities. Deferred tax

assets and liabilities are recorded based upon enacted tax rates for the period in which the deferred tax items are expected to

reverse. Changes in tax laws or tax rates in various jurisdictions are reflected in the period of change. Significant judgment is

required in the calculation of our tax provision and the resulting tax liabilities as well as our ability to realize our deferred tax

assets. Our estimates of future taxable income and any changes to such estimates can significantly impact our tax provision in a

given period. Significant judgment is required in determining our ability to realize our deferred tax assets related to federal,

state and foreign tax attributes within their carryforward periods including estimating the amount and timing of the future

reversal of deferred tax items in our projections of future taxable income. A valuation allowance is established to reduce

deferred tax assets to the amounts we expect to realize in the future. We also recognize tax benefits related to uncertain tax

positions only when we estimate that it is “more likely than not” that the position will be sustainable based on its technical

merits. If actual results are not consistent with our estimates and assumptions, this may result in material changes to our income

tax provision.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation and amortization. Property and equipment are depreciated or amortized over their estimated useful lives. We apply judgment in determining the useful lives based on factors such as engineering data, our long-term strategy for using the assets, the manufacturer’s estimated design life for the assets, laws and regulations that could impact the useful lives of the assets and other economic factors. In evaluating the useful lives of our satellites, we assess the current estimated operational life of the satellites, including the potential impact of environmental factors on the satellites, ongoing operational enhancements and software upgrades. Additionally, we review engineering data relating to the operation and performance of our satellite network.

We depreciate our satellites over the shorter of their potential operational life or the period of their expected use. The appropriateness of the useful lives is evaluated on a quarterly basis or as events occur that require additional assessment. The upgraded satellites that have been placed into service are depreciated using the straight-line method over their respective estimated useful lives. If the estimated useful lives of our upgraded satellites change, it could have a material impact on the timing of the recognition of depreciation expense and hosted payload revenue.

In the fourth quarter of 2023, we updated our estimate of the satellites’ remaining useful lives based on the health of the constellation, resulting in an extension from 12.5 years to 17.5 years. If our actual operational results are not consistent with our estimates and assumptions, however, we may experience further changes in depreciation and amortization expense that could be material to our results of operations. See Note 2 to the consolidated financial statements included in this report for further detail on the impact of this change.

47

Comparison of Our Results of Operations for the Years Ended Decem

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]