ST Engineering explores "strategic options" for iDirect

ST Engineering has reported a non-cash impairment of its iDirect group and is exploring “strategic options” for the business, the Singapore-based global technology, defense and engineering giant reveals.

It explains that a challenging near-term operating environment — which has seen non-geostationary satellite orbit (NGSO) operators enjoy rapid expansion and GEO satellite operators face “delayed and limited” launches — plus continued losses at iDirect group means that a turnaround will take longer than expected.

Supporting the satcom industry, the iDirect group comprises STE iDirect, Inc, ST Engineering iDirect (Europe) NV, and ST Engineering iDirect (APAC) Pte Ltd, together with their respective subsidiaries. Its ground platform advancements, including for SES and other satellite operators, have been built to improve the passenger experience in key industries including mobility. In aviation, the iDirect brand is perhaps best known for its modems, which power inflight connectivity.

During the third quarter of this year, ground segment infrastructure contracts were secured in Asia, Europe, Middle East and the United States. Even so, ST Engineering says major NGSO operators are deploying “proprietary, closed and vertically integrated ground systems” that eliminate the need to procure ground segment equipment from providers like iDirect group. This in turn has impacted customer adoption of iDirect’s next-generation ground platform, Intuition, which is designed to help customers leverage multi-orbit satellite networks.

“At the same time, NGSO operators are increasingly winning contracts from traditional customers of GEO operators in sectors such as aviation by offering lower latency, higher bandwidth and greater service flexibility,” adds ST Engineering iDirect.

Serving the aero market directly, SpaceX’s Starlink Ku-band Low Earth Orbit (LEO) satellite-based service has proven to be a disruptor, having won a raft of airline customers for its inflight connectivity service, including recently IAG Group. Amazon is in the process of building out its Project Kuiper Ka-band LEO constellation, and has launched over 150 satellites to date. It secured JetBlue as a customer in September.

Eutelsat OneWeb’s Ku-band LEO network also supports cabin connectivity but through a B2B approach that sees it partnered with integrators and aero ISPs including SES and Panasonic Avionics, which are presently installing IFC hardware on aircraft in support of multi-orbit LEO/GEO IFC.

Air Canada and American Airlines — and, from 18 November, Royal Brunei Airlines — are among the operators flying with SES’s multi-orbit service, as supported by the Gilat Stellar Blu electronically steerable antenna. Hughes Network Systems provides the OneWeb modem in aero, and it engineered the gateways for the LEO network’s ground segment.

ST Engineering, meanwhile, has assessed the Value in Use (VIU) of the iDirect group, and determined it to be $170 million as of 30 September 2025. “Hence, the carrying amount for the iDirect group of $837 million was impaired by $667 million,” explains the firm in an earnings update.

It has also reported an impairment of $22 million for JetTalk, a joint venture between SatixFy and ST Engineering which aided development of various aero terminal hardware. SatixFy was recently acquired by MDA Space.

Despite headwinds and consolidation in the satcom sector, highly-diversified ST Engineering achieved strong revenue of $9.1 billion for the first nine months of the year, representing a 9% increase year-over-year for the wider Group. Its order book also reached a new high. “These strong underlying results reflect the strength and resilience of our business strategy and fundamentals,” says Group president and CEO Vincent Chong.

The objective of ST Engineering’s evaluation of iDirect group is to mitigate risks and financial exposure to ST Engineering, as well as to strengthen iDirect group’s ability to better support its customers. The firm says it’s in “active discussions on strategic options” for the iDirect group, though “no definitive agreement has been reached with any party, and there is no certainty that any strategic transaction will take place.”

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