Maxar’s released its second quarter earnings yesterday and while revenue was down, margins increased, primarily due to the imagery business.

According to Maxar “consolidated revenues for the second quarter of 2018 were US$578.9 million compared to US$375.2 million for the same period of last year. The increase was primarily due to the inclusion of DigitalGlobe’s imagery and services businesses as a result of the DigitalGlobe Transaction.”

During the conference call CEO Howard Lance said that they were “establishing a separate organization structure and bringing in new talent to focus on execution of the U.S. government and commercial SmallSat’s growth opportunities,” with a facility opening in San Jose. Lance said Maxar believes there is “a healthy pipeline of SmallSat in U.S. government opportunities” and that there will be “sustained growth well into the 2020’s.”

At the same Maxar is looking to small satellite constellation opportunities in Low Earth Orbit (LEO) and Medium Earth Orbit (MEO), the Geosynchronous Equatorial Orbit (GEO) market continues to lag and Maxar is adjusting to this by downsizing some of its operations in Palo Alto with Lance saying, “we continue to exit at least buildings and consolidate our footprint on the Palo Alto campus.” There have been and will continue to be staff reductions in the SSL Palo Alto facility that works in the GEO business.

On Monday Maxar announced that they had created a consortium comprised with Thales Alenia Space and had been awarded systems design contract for Telesat’s LEO constellation.

Lance provided some further details on the division of responsibilities for the consortium saying “we’ll focus on our strengths, which certainly will include the bus and all the propulsion, infrastructure as well as very advanced antenna technology and other satellite electronics at MDA. Thales has experienced, more experienced frankly, with systems engineering of large constellations. They just completed the Iridium NEXT program as well as further along in development and application digital payloads.”

Lance sees the partnership with Thales Alenia Space as being equal.

Interestingly Lance said “we have access through our relationships in Canada to funding for the constellation they have accessed through their European relations.” This would likely be referring to the $100M the government had set aside as part of the Strategic Innovation Fund in the last budget for LEO satellites.

Maxar is moving ahead with its WorldView Legion constellation and expects that the US$600M investment will see most of its expenditures between now and 2020.