Why Iridium Communications (IRDM) Is Up 5.6% After Pausing Buybacks to Fund Acquisitions and Cut Debt

• Iridium Communications reported third quarter 2025 earnings above expectations, highlighted the launch of its PNT ASIC chip, and announced a pause on its share repurchase program to prioritize acquisitions and deleveraging.
• An interesting aspect is Iridium's explicit shift in focus toward bolt-on M&A in complementary markets, with increased financial flexibility supporting both growth and balance sheet improvement.
• We'll explore how Iridium's pause of share buybacks to fund acquisitions and reduce debt may reshape its longer-term investment narrative.

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Iridium Communications Investment Narrative Recap

To be a shareholder in Iridium Communications, you need to believe in the company’s ability to capture growth from industrial-grade IoT and PNT services, while effectively managing financial discipline and expanding through targeted acquisitions. The decision to pause the share buyback program in favor of M&A and deleveraging does not materially affect the most immediate catalyst, which remains meaningful uptake of new IoT and PNT services; however, it does highlight ongoing competitive and business mix pressures that could weigh on shorter-term sentiment.

The recent launch of Iridium's PNT ASIC chip stands out as particularly relevant, given management's emphasis on alternative PNT as a growth pillar and a potential differentiator amid intensifying competition. With commercial availability planned for mid-2026, the PNT ASIC chip addresses the rising demand for global, secure timing data, an area that could offset some headwinds from slowing IoT growth or margin pressure if adoption accelerates as projected.

But the persistence of ARPU pressure as maritime users shift to lower-cost backup offerings remains a risk investors should be acutely aware of, especially if...

Read the full narrative on Iridium Communications (it's free!)

Iridium Communications is forecast to reach $982.9 million in revenue and $174.8 million in earnings by 2028. This outlook assumes annual revenue growth of 4.7% and an earnings increase of $61.6 million from the current level of $113.2 million.

Uncover how Iridium Communications' forecasts yield a $31.00 fair value, a 62% upside to its current price.

Exploring Other Perspectives

Eight Simply Wall St Community valuations range from US$25 up to US$68.01, showing wide divergence on fair value for Iridium. As you consider these varying outlooks, keep in mind that the company faces ongoing ARPU pressure in its maritime business, which adds important context for your own research.

Explore 8 other fair value estimates on Iridium Communications - why the stock might be worth just $25.00!

Build Your Own Iridium Communications Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Iridium Communications research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Iridium Communications research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Iridium Communications' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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