Israel's Gilat Satellite Networks Ltd invited customers from around the world to Israel in June for strategic business discussions. Fate intervened. At exactly that time, Israel launched strikes on Iran, airspace was closed and the guests were stranded in Israel for a week under barrages of ballistic missiles until the company managed to extract them through the Jordanian border.
As a result, this conversation with CEO Adi Sfadia, held amid heightened tensions with Iran, is taking place on Zoom while he attends a conference in Budapest. "We debated whether to hold the discussions in Israel or abroad," he said. "It was probably more luck than judgment, because if we had not done it here, it would not have happened at all."
Conferences in Hungary are apparently part of the price of running a large international corporation whose business spans dozens of countries, leads in communications and defense industries, competes with the world’s biggest tech players and captures the imagination of investors. National pride interests them far less.
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Satellite communications systems used by the military
(Photo: Gilat Satellite Networks Ltd )
The battle for space is in full swing. Companies such as Elon Musk’s Starlink and Jeff Bezos’ Amazon are investing billions of dollars to launch thousands of small satellites into orbit. Somewhat surprisingly, one company from Petah Tikva is proving technological and commercial strength in this arena as well.
Gilat builds space communications infrastructure, various terminals and antennas that connect to all types of communications satellites. It operates across emerging technologies and is winning major European and American tenders.
The technology is used by telecom operators, enabling passengers to browse the internet on transatlantic flights or make calls from remote trekking routes in the Himalayas. It also provides uninterrupted communications for militaries, regardless of where their forces are deployed.
Over the past year, Gilat’s share price has jumped more than 160%. This week it traded at an all-time high, nearly touching $20 a share. The company is dual-listed on Nasdaq and the Tel Aviv Stock Exchange with a market value of about 3.5 billion shekels.
A series of acquisitions, major contract wins and ambitious plans for the coming year have turned Gilat into a favorite of analysts and investors. Its next quarterly results, due soon, will show whether the momentum continues or fades.
From CFO to CEO
Gilat Satellite Networks, the company’s official name, is a veteran firm founded in 1987 by a group of entrepreneurs led by Yoel Gat. Its first product was a VSAT satellite communications terminal. After early success came difficult years following the dot-com crash. Customers vanished, debt piled up and the company was forced into a restructuring.
In 2003, Gat stepped down as CEO and chairman, followed by a rapid succession of executives. Attempts to revive the company through acquisitions failed.
Sfadia, then CFO, recalled: "After the 2010 acquisitions of Wavestream and RAYSAT, the company entered years without profits. In 2015, I joined amid profit warnings and losses. As CFO, together with then-CEO Yona Ovadia, we led efficiency measures and refocused on profitable deals. That returned us to profitability."
In 2020, Gilat nearly sold itself to U.S.-based Comtech. Between signing and closing, the buyer withdrew and was forced to pay Gilat about $70 million, which was distributed as a dividend. Sfadia, then interim CEO, soon proved to be the right choice and his appointment became permanent.
It is not common for a CFO to become CEO. How did it happen?
"I am a CPA by training," Sfadia said. "I spent nearly six years at EY, then worked as a controller at startups, moved to RADA Electronic Industries, then RADVision and Starhome. I became CFO at Gilat in 2015 and in November 2020 was appointed CEO. Many CEOs come from finance, others from product or sales. It depends on the person."
For years, the company was steady, even sleepy. Something changed in the past two years.
"Gilat has been in business for 39 years, and what we do today is largely what we did in the past, with some adjustments," Sfadia said. "Our core focus is satellite internet. We build the communications equipment that enables it. We operate powerful transmitters and receivers in gateway stations with very large antennas. On the other side, the equipment connects to our VSAT modems. You say, 'I want to view ynet', hit enter and the signal goes up to the satellite."
Gilat's growth was propelled by more than just the ability to browse news sites.
"Over time, we focused on areas where we deliver greater value. Our current focus is on very high-throughput satellites. These geostationary satellites can deliver hundreds of gigabytes per second. In the past, they managed only about 10 gigabytes."
Competing with Starlink, supplying Amazon
There are three types of satellites, distinguished by their orbital altitude. Traditional GEO satellites hover about 36,000 kilometers above a fixed point on Earth, covering the vast majority of the Earth’s surface. LEO satellites, such as Starlink, orbit at much lower altitudes (500-2,000 km), move extremely fast and require antennas to rapidly switch between satellites, but they offer near-zero latency. MEO satellites operate at intermediate altitudes (5,000-20,000 km) and serve various commercial uses.
Gilat works with all of these, giving it a major advantage. Its multi-orbit software-defined architecture allows its SkyEdge IV system to identify available satellites in real time and adapt communications accordingly. Unlike Starlink’s closed system, Gilat’s technology works with any constellation. If Starlink is the "Apple" of the satellite world, Gilat is its "Android," enabling everyone to talk to everyone.
"Today we operate in network equipment for GEO and MEO satellites," Sfadia said. "In LEO, we are competing for several projects. We supply equipment to Amazon’s Kuiper project and are bidding on major initiatives, including IRIS², the pan-European satellite constellation aimed at reducing Europe’s dependence on the U.S., Donald Trump and Elon Musk."
IRIS² is backed by a $12 billion budget through the SpaceRise consortium, partly funded by SES, one of Gilat’s key customers. In MEO, Gilat operates SES’ satellite network and supplies most of the equipment.
Would you say these deals made Gilat a hit?
"In 2022, shortly after I became CEO, we looked for growth areas where we could operate independently," he said. "We made acquisitions to accelerate market entry. The first was in defense, acquiring U.S.-based DataPath. That was our entry into defense. They generated $37 million in annual sales and were near breakeven. With new management, revenues are nearly doubling this year and profitability looks strong."
"Next came Stellar Blu, developer of electronically steered antennas. They were just before a breakthrough. Today, it is the only antenna that supports both GEO and LEO. They had an order backlog of nearly $200 million with Intelsat and Panasonic. Today, more than 400 aircraft are equipped with our antennas. More than 3,000 passenger aircraft carry a Gilat modem or antenna."
The Stellar Blu $100 million acquisition drew criticism. Was it a gamble?
"Every business involves some risk and some luck," Sfadia said. "We identified market trends correctly. We are a major player in in-flight connectivity, hold more than 25% of the amplifier market and are strong in modems with Intelsat and SES. We always wanted to be a player in the antenna market, so we chose a faster route."
"We could have become a player with tens of millions of dollars and four to five years of development, but we might not have found the right customer. Instead, we paid $100 million, acquired a company with a large order backlog and began delivering. Early on, we faced some supply chain challenges, which we had anticipated."
One-third of revenue from defense
Gilat’s defense business, which began with the acquisition of DataPath, has been growing steadily. Defense now accounts for about one-third of Gilat’s revenue and is growing. The global defense tech market has surged, fueled by wars in Gaza, Iran and Ukraine. Gilat supplies portable satellite communications systems to militaries, from trailer-mounted antenna farms to soldier-carried gear.
"It is not just identifying defense opportunities," said Hagay Katz, chief product and marketing officer. "Execution matters. Our go-to-market strategy and products speak for themselves."
Sfadia added: "Defense is our main focus. The market is over $2 billion today and expected to exceed $4 billion within five years. We sell about $100 million annually, less than 5% of the market. There is enormous room to grow, especially with the U.S. Department of Defense and European militaries."
A bullish outlook, with risks
Markets in Tel Aviv and New York have rewarded Gilat, reflected in its elevated share price. Investors who bought into the company in early 2025 have plenty to smile about today. The stock has posted triple-digit gains over that period, and the momentum appears to be continuing.
The turning point came with the third-quarter 2025 report, when Gilat posted 58% revenue growth. Earnings per share beat analyst forecasts by 72%, a rare result that drew global attention. The market came to understand that Gilat was no longer a small, project-based company, but one generating recurring revenue from every aircraft equipped with its antenna and every military satellite communications system it sells.
Analyst reviews published in recent weeks have praised its expansion, including its growing emphasis on defense and planned new satellite platforms. At the same time, they have warned that the stock may be overbought due to its high valuation. Some analysts have downgraded their recommendation from "buy" to "hold" after the share price reached record levels and exceeded all forecasts.
As the company heads into the release of its earnings next week, expectations are soaring. If the company raises its 2026 forecast, the share price could see another jump. Gilat holds substantial cash reserves, is profitable and operates in a market expected to grow 17% annually through 2031. The main risk is unexpected competition, such as aggressive price cuts by Starlink.
How concerned should Elon Musk and Starlink be about Gilat, or vice versa?
"Starlink does not compete with us directly, but with our customers", says Sfadia. "But when it wins over our customers, they buy less equipment from us. I think that right now we are in a very unique situation. Starlink is not winning customers on price, but because it has excess capacity.
"Existing satellites are almost fully saturated in high-demand areas. That bottleneck is expected to ease toward the end of the year with new satellites from SES and Eutelsat. We assess that they will then begin competing on price as well and regain some of the market share they lost to Starlink. Overall, I think Starlink is opening markets for everyone. I do not think this will be a winner-takes-all situation."
Against Amazon’s rival network, you are actually one of its suppliers.
"We cannot name our customers. We are working with a large LEO constellation for which we supply antenna amplifiers. We were one of three players competing to provide the amplifiers. One failed to deliver a solution (the same Comtech that once tried to acquire Gilat), and the other lags behind us in quality and performance. As of now, we are the leading player.
"In Eutelsat’s OneWeb network, we managed to secure up to 100% of the system. Here, I estimate we will take around 60%, possibly a bit more. That represents the potential of more than $100 million, of which we have already received $50 million in orders. Service is expected to begin toward the end of the year, and we believe we will see an additional boost in orders around that time."
Should we expect to see additional acquisitions this year?
"We raised $166 million from Israeli investors so we would be ready for further acquisitions. Our current focus is expanding our target markets, primarily through defense acquisitions, but not only. We are prepared to acquire companies that require realignment. We have proven we can do this, with DataPath as a clear example.
"There may be smaller acquisitions of companies valued at tens of millions of dollars, or deals involving companies with more than $100 million in annual revenue. We have a business development team that reviews dozens of companies each year, including Israeli ones. We will not acquire a startup that only creates expenses, but there could be a deal that is not profitable from day one."