Gilat Satellite Networks Ltd. (NASDAQ: GILT, TASE: GILT), headquartered in Petah Tikva, published its second-quarter report on 5 August 2026. We are writing about it today, 6 August.
What was reported
| Quarter | Year ago | Change | |
|---|---|---|---|
| Revenue | 122.7 | +17% | |
| GAAP operating income | 4.7 | 5.7 | -18% |
| Non-GAAP operating income | 12.6 | 9.3 | +35% |
| Adjusted EBITDA | 15.4 | 11.8 | +31% |
| GAAP net income | 8.1 | 9.8 | -17% |
| GAAP EPS | $0.10 | $0.17 | -41% |
| Non-GAAP net income | 15.6 | 12.0 | +30% |
| Non-GAAP EPS | $0.20 | $0.21 | -5% |
In millions of dollars except per-share data
The gap worth explaining
Net income rose 30% - and earnings per share fell
Look at the last two rows of the table.
Non-GAAP net income rose from $12.0 million to $15.6 million - plus 30%.
And earnings per share fell: from $0.21 to $0.20.
How do those two fit together? Only one way: the share count grew.
And it is even starker on the GAAP line: net income fell by only 17% (from $9.8 million to $8.1 million), but EPS fell 41% - from $0.17 to $0.10.
Meaning dilution not only absorbed the operating improvement - it multiplied the GAAP decline by roughly two and a half.
This is worth watching. Revenue growth of 17% and EBITDA growth of 31% is real growth. But an existing shareholder benefits from it only if it does not come at the expense of their share of the company.
And the second gap: GAAP against non-GAAP
GAAP operating income fell - $4.7 million against $5.7 million a year ago.
Non-GAAP operating income rose 35% - $12.6 million against $9.3 million.
The gap between them is $7.9 million, composed mainly of share-based compensation and amortisation of intangibles - two non-cash lines, but share-based compensation is precisely what produces the dilution described above.
So the same item stripped out of non-GAAP profit comes back to hurt earnings per share.
The guidance
The company reiterates its 2026 outlook:
- Revenue of $500 to $520 million - roughly 13% growth at the midpoint
CEO Adi Sfadia: "Gilat delivered another strong quarter, with revenues increasing 17% and Adjusted EBITDA increasing 31%." And in conclusion: "Our first-half performance, recent awards, backlog, and strong pipeline support our full-year 2026 outlook."
Worth noting that the company reiterated the guidance rather than raising it - despite a strong first half.
My Angle
A personal opinion of Ilan Abramov - not advice, not a recommendation
Gilat is a good example of why it matters to read the per-share line and not only net income.
The operating result is genuinely good: revenue plus 17%, adjusted EBITDA plus 31%, non-GAAP operating income plus 35%. A satellite infrastructure company growing at a double-digit rate and widening margins is a perfectly sound story.
And what stops me is the dilution. Non-GAAP net income rising 30% while earnings per share falls - that means the entire improvement, and a little more, went to new shares. The existing shareholder saw none of it this quarter.
And that is not necessarily wrong. Share-based compensation is how technology companies recruit people, but when it is large enough to cancel the growth, it stops being an expense and becomes a question.
And what I note in the guidance: the company reiterated rather than raised it. After a first half it describes as strong, and with backlog and awards it cites explicitly - choosing not to raise is itself a choice, and it says something about confidence in the second half.
