Sometimes the stock market reacts to earnings reports in ways that seem, at first glance, a bit counterintuitive. Take Globalstar Inc. (GSAT) on Friday. The satellite communications company reported what you might politely call "mixed" results for its fiscal fourth quarter of 2025. Yet, its stock was up over 5%. So, what gives?

Let's unpack the numbers. For the quarter, Globalstar posted revenue of $71.96 million. That was a beat, coming in above the analyst consensus estimate of $71.22 million. Digging into that revenue, service revenue—the core, recurring stuff—jumped 17% year-over-year to $67.39 million, driven largely by more wholesale capacity services. Revenue from selling subscriber equipment also popped, up 31% to $4.57 million.

So far, so good. But then we get to the bottom line. The company reported a net loss of $11.6 million. Now, that's a massive improvement from the $50.2 million loss it posted in the same quarter last year. However, on a per-share basis, that loss came out to 11 cents. Wall Street was only expecting a loss of 1 cent. That's a wider loss than anticipated.

Normally, a wider-than-expected loss might send a stock tumbling. But investors seemed to be looking past the quarterly EPS miss and focusing on other, arguably more important, metrics. For one, the company's profitability on an operational basis looked strong. Adjusted EBITDA—a measure of core profitability—increased to $32.4 million from $30.4 million a year ago.

More importantly, the market's positive reaction likely stems from the full-year picture and what management is saying about the future.

The Bigger Picture for 2025

For the entire fiscal year 2025, Globalstar hit a record revenue of $273 million. This wasn't a one-off; it marks the company's fourth consecutive year of revenue growth. Even more impressive, it achieved a record adjusted EBITDA of $136.1 million, signaling that this growth is translating into solid operational profitability.

CEO Dr. Paul E. Jacobs didn't mince words, calling 2025 a "transformational year." He said the company advanced its strategy across global infrastructure, product innovation, and commercial adoption in government, enterprise, and industrial markets. "We expanded our addressable markets and validated technologies that place us at the center of next-generation satellite and private wireless connectivity," Jacobs stated.

He highlighted significant progress with satellite and ground station partners, noting the company is now "ready to deploy satellites to replenish its existing constellation and extend its reach with a third-generation system."

Cash is King (and Queen)

Another critical factor for any company, especially one investing heavily in infrastructure, is its financial health. Globalstar appears to be in a robust position here. As of December 31, 2025, the company was sitting on $447.5 million in cash and equivalents. That's a serious war chest.

It also generated $175.89 million in operating cash flow during the quarter. Yes, that's down from an exceptionally high $340.66 million in the year-ago quarter, but it's still a substantial influx of cash from its core operations.

Looking Ahead to 2026

Perhaps the biggest catalyst for the stock's rise was the forward-looking guidance. For fiscal 2026, Globalstar expects revenue in the range of $280 million to $305 million. At the midpoint, that's about 8% growth over the record 2025 revenue. Perhaps more enticing for profitability-focused investors, the company expects an adjusted EBITDA margin of approximately 50%.

Jacobs said the plan for 2026 is to "build on our momentum to scale operations." He pointed to several concrete steps: replacement second-generation satellites coming off the production line, progress on regulatory and network infrastructure, the commercial rollout of two-way IoT capabilities, and traction for its XCOM RAN technology.

"We have begun shifting from groundwork to growth," Jacobs said, positioning the company "to deliver differentiated connectivity solutions that combine satellite innovation, licensed spectrum, and proprietary wireless technology to meet evolving global customer needs."

So, why did the stock go up on a wider quarterly loss? Because the market is often a forward-looking machine. Investors seemed to be weighing the quarterly EPS miss against a record annual performance, a fortress-like balance sheet, and a management team laying out a clear, confident, and well-funded path for growth in the year ahead. Sometimes, a little short-term pain is worth it for a promising long-term trajectory.