Business Combinations, Asset Acquisitions, Transaction between Entities under Common Control, and Joint Venture Formation

9 Months Ended

Sep. 30, 2026

Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]

Mergers, Acquisitions and Dispositions Disclosures

15. Merger Agreement with Rocket Lab Corporation

On June 28, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Rocket Lab Corporation (“Rocket Lab”) pursuant to which the Company 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 the Company’s 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 the Company and Rocket Lab with certain termination rights and, under certain circumstances, may require the Company to pay a $223.6 million termination fee.

The Transaction is expected to be completed by mid-2027, subject to the satisfaction of remaining customary closing conditions and interim operating covenants, including covenants that generally require the Company to conduct its business in the ordinary course consistent with past practice and subject the Company to restrictions on certain actions pending consummation of the Transaction.

Asset Acquisition

11. Acquisition of Aireon

On July 2, 2026, the Company acquired the 60.5% equity interest in Aireon Holdings that it did not previously own, resulting in the Company obtaining 100% ownership of Aireon. Aireon is the operator of the world’s only space-based Automatic Dependent Surveillance-Broadcast (“ADS-B”) air traffic surveillance system.

The acquisition date fair value of the business at the acquisition date was $523.8 million. The purchase price for the remaining 60.5% equity interest was $352.2 million. The transaction was accounted for as a business combination under the acquisition method of accounting in accordance with Accounting Standards Codification 805, Business Combinations. Since the Company held a 39.5% equity interest in Aireon immediately prior to the acquisition date and accounted for that investment under the equity method, the Company remeasured its previously held equity interest to its estimated fair value of $171.6 million as of the acquisition date and recognized a gain of $103.9 million in gain (loss) from equity method investments, net in the condensed consolidated statement of operations and comprehensive income for the three and nine months ended September 30, 2026.

The following table summarizes the acquisition date fair value of the business:


	July 2, 2026
	(In thousands)
Cash consideration	$	183,362
Seller note	172,789
Seller transaction costs paid by the Company	11,284
Settlement of pre-existing relationships	(15,212)
Total consideration transferred	352,223
Fair value of previously held 39.5% equity interest	171,600
Total acquisition date fair value	$	523,823

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:


	July 2, 2026
	Fair Value
	(In thousands)
Cash	$	14,848
Accounts Receivable, net	25,212
Prepaid expenses and other current assets	8,507
Property and equipment, net	161,935
Intangible assets, net	285,100
Other non-current assets	43,665
Accounts payable	(3,709)
Accrued expenses and other current liabilities	(11,295)
Short-term secured debt	(19,688)
Deferred revenue	(1,717)
Long-term secured debt	(134,969)
Other long-term liabilities	(11,238)
Total fair value of net assets acquired	$	356,651
Goodwill	$	167,172
Total purchase price	$	523,823

The purchase price allocation is preliminary as the Company is continuing to finalize the valuation of certain acquired intangible assets and other assets and liabilities assumed. The Company expects to finalize the purchase price allocation within the measurement period, which will not exceed one year from the acquisition date.

The following is a summary of preliminary identifiable intangible assets acquired and the related expected lives for the finite-lived intangible assets:

Type

Useful life

Fair Value

(In thousands)

Customer relationships

13 years

210,000

Developed technology

10 years

69,600

Trade name

4 years

5,500

Total identifiable intangible assets acquired

285,100

Goodwill of $167.2 million was recorded in connection with the Aireon acquisition, representing the excess of the purchase price over the fair value of the identifiable net assets acquired. Goodwill primarily represents Aireon’s future revenue and earnings potential, expected synergies, and the assembled workforce of Aireon. None of the goodwill is expected to be deductible for income tax purposes.

The Company incurred $14.9 million of acquisition-related costs that were expensed in the three and nine months ended September 30, 2026. These costs are included within selling, general, and administrative expenses in the condensed consolidated statements of operations and comprehensive income.

The amounts of revenue and earnings of Aireon included in the Company’s condensed consolidated statements of operations and comprehensive income (loss), including the effects of purchase accounting and excluding the impact of the Company’s remeasurement of its prior equity interest in Aireon Holdings, are as follows:


	Three Months Ended September 30, 2026
	(In thousands)
Revenue	$	34,492
Net loss	(55)

Supplemental Pro Forma Information (Unaudited)

The following unaudited pro forma data summarizes the results of operations for the periods indicated as if the acquisition of Aireon had occurred on January 1, 2025.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2026		2025		2026		2025
	(In thousands)				(In thousands)
Revenue	$	245,733	$	249,317	$	733,779	$	726,365
Net income	2,068		29,384		19,388		164,623

The unaudited pro forma financial information includes adjustments to reflect incremental amortization of acquired identifiable intangible assets, incremental depreciation resulting from fair value adjustments to property and equipment, related income tax effects, the acquisition-date remeasurement of the previously held equity interest, acquisition-related transaction costs and the elimination of intercompany transactions. The pro forma financial information does not reflect potential synergies or integration costs and is not necessarily indicative of the results that would have occurred or of future results.

Business Combination, Acquiree's Earnings (Loss) since Acquisition Date, Actual - Table Text Block


	Three Months Ended September 30, 2026
	(In thousands)
Revenue	$	34,492
Net loss	(55)