Gilat Secures Over $32M Multi-Band DKET Award for U.S. Defense Network Resilience

What happened

Gilat announced on September 9, 2026 that its Defense segment received an award exceeding $32 million for multi-band DKET (Deployable Ku-band Earth Terminal) systems supporting U.S. defense network resilience. The press release from GlobeNewswire indicates this is a significant award that reinforces Gilat Defense's expanding role in large-scale, mission-critical U.S. communications programs. This follows a series of defense order announcements in 2026, including over $7 million for 24-month Wavestream amplifier shipments and European MoD terminal contracts with 12-month delivery schedules. The award adds to the defense order backlog but does not directly address the company's known execution risks: Commercial segment gross margin remains depressed at 27% due to SBS initial production economics, and the Comtech S&S acquisition still requires HSR and CFIUS clearance with a year-end closing target. Investors should treat the announcement as incremental backlog growth, not a resolution of the margin and deal-timing concerns that anchor the current WAIT rating.

Implication

For investors, the $32M DKET award confirms continued demand from U.S. defense programs and adds to the multi-period order book, supporting the base-case revenue trajectory of $510M for FY2026. However, the award does not alter the key thesis drivers: Commercial gross margin recovery above the 27% FY2025 baseline and evidence that the Comtech S&S acquisition will close by end-2026 remain the primary catalysts. The ongoing insider selling pattern (CEO and CLO liquidating nearly all directly held shares in March 2026) adds a cautionary signal that management may lack conviction in near-term upside. With the stock currently near $12.50, the valuation already embeds some execution success, leaving limited margin of safety if deal approvals slip or SBS margins fail to improve. Consequently, the prudent approach is to maintain a WAIT posture and monitor for Q3 2026 margin improvement and any regulatory update on the Comtech transaction.

Thesis delta

No major shift: this defense award reinforces the existing positive demand signal for Gilat's defense segment, consistent with the report's observation of multi-period delivery profiles. However, it does not address the two central risks that justify the WAIT rating: the Commercial gross margin compression to 27% due to SBS and the unresolved HSR/CFIUS clearance timeline for the Comtech acquisition. Therefore, the investment thesis remains unchanged—wait for confirmation of Commercial margin recovery and deal-process progress before considering a position.