MDA Space — Management Reports 2025

May 8, 2025

MDA Space Ltd.
Management’s Discussion and Analysis

For the First Quarters Ended
March 31, 2025 and 2024

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Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION 3
NON-IFRS FINANCIAL MEASURES 4
COMPANY OVERVIEW 6
INDUSTRY OVERVIEW AND TRENDS 7
BUSINESS AREAS 7
COMPETITIVE STRENGTHS 10
GROWTH STRATEGIES 10
QUARTERLY HIGHLIGHTS 11
FINANCIAL OVERVIEW 12
2025 FINANCIAL OUTLOOK 13
RESULTS OF OPERATIONS 14
FINANCIAL CONDITION, LIQUIDITY & CAPITAL RESOURCES 17
FINANCIAL INSTRUMENTS 19
OFF-BALANCE SHEET ARRANGEMENTS 19
TRANSACTIONS BETWEEN RELATED PARTIES 19
SIGNIFICANT ACCOUNTING POLICIES, ESTIMATES, AND JUDGMENTS 19
RECENT ACCOUNTING PRONOUNCEMENTS 20
SUMMARY OF QUARTERLY RESULTS 20
CONTROLS AND PROCEDURES 20
RISK FACTORS 21
OUTSTANDING SHARE INFORMATION 21
ADDITIONAL INFORMATION 22
GLOSSARY OF TERMS 23

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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Management's Discussion and Analysis

The following Management's Discussion and Analysis (MD&A) provides information management believes is relevant to an assessment and understanding of the consolidated financial condition of MDA Space Ltd. (the "Company", "we", "MDA Space" or "MDA") as at March 31, 2025 and its consolidated operating results for the three months ended March 31, 2025 and 2024. The MD&A should be read in conjunction with the cautionary statement regarding forward-looking information below, as well as the unaudited interim condensed consolidated financial statements of the Company for the three months ended March 31, 2025 and 2024 (the "Q1 2025 Financial Statements") and the audited consolidated financial statements of the Company for the years ended December 31, 2024 and 2023 (2024 Audited Financial Statements) filed on the System for Electronic Document Analysis and Retrieval (SEDAR+) at www.sedarplus.ca. All dollar amounts are expressed in Canadian Dollars (CAD) except where otherwise specified and all numbers are in millions, unless otherwise specified or for per share amounts or ratios. References to "Q1 2025" or "this quarter" are to the fiscal quarter ended March 31, 2025 and references to "Q1 2024" are to the fiscal quarter ended March 31, 2024. The MD&A is current to May 7, 2025, unless otherwise noted.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This MD&A contains "forward-looking information" within the meaning of applicable Canadian securities laws. Such forward-looking information includes, but is not limited to, information with respect to the Company's objectives and strategies to achieve these objectives, as well as information with respect to the Company's beliefs, plans, expectations, anticipations, estimates, intentions and views of future events. Discussions containing forward-looking information may be found, among other places, under the headings "Industry Trends", "Outlook", "Growth Strategies" and "Financial Overview" in this MD&A. In some cases, forward-looking information can be identified by words or phrases such as "forecast", "target", "goal", "may", "might", "will", "expect", "anticipate", "estimate", "intend", "plan", "indicate", "seek", "believe", "predict", or "likely", or the negative of these terms, or other similar expressions intended to identify forward-looking information. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts. The Company has based the forward-looking information on its current expectations and projections about future events and financial trends that it believes might affect its financial condition, results of operations, business strategy and financial needs.

Statements containing forward-looking information are based on certain assumptions and analyses made by the Company in light of management's experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate and are subject to risks and uncertainties. These assumptions include, among others, our ability to maintain and expand the scope of our business; our ability to execute on our growth strategies; assumptions relating to government support and funding levels for space programs and missions; continued and accelerated growth in the global space economy; the impact of competition; our ability to retain key personnel; our ability to obtain and maintain existing financing on acceptable terms; changes and trends in our industry or the global economy; currency exchange and interest rates; and changes in laws, rules, regulations.

Although the Company believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect and there can be no assurance that actual results will be consistent with the forward-looking information. Whether actual results, performance or achievements will conform to the Company's expectations and predictions is subject to a number of known and unknown risks, uncertainties, assumptions and other factors. For additional information with respect to certain of these risks or factors, reference should be made to those described in this MD&A and to the 2024 Audited Financial Statements, together with those described and listed under the heading "Risk Factors" in the Company's Annual Information Form for the year ended December 31, 2024 (AIF) available on SEDAR+ at www.sedarplus.ca which are incorporated by reference into this MD&A.

The Company cautions investors that statements containing forward-looking information are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which it operates may differ materially from those made in or suggested by the forward-looking information contained in this MD&A. In addition, even if the Company's results of operations, financial condition and liquidity and the development of the industry in which it operates are consistent with the forward-looking information contained in this MD&A, those results or developments may not be indicative of results or developments in subsequent periods.

Given these risks and uncertainties, investors are cautioned not to place undue reliance on the forward-looking information. Any forward-looking information that is made in this MD&A speaks only as of the date of such statement,

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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and the Company undertakes no obligation to update any forward-looking information or to publicly announce the results of any revisions to any of those statements to reflect future events or developments, except as required by applicable securities laws. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data.

NON-IFRS FINANCIAL MEASURES

This MD&A refers to certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective. Accordingly, the measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. We use non-IFRS measures, including EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Earnings per Share, Order Bookings, Net Debt and Free Cash Flow to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors, and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Our management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation.

Adjusted EBITDA and Adjusted EBITDA margin

Adjusted EBITDA and Adjusted EBITDA margin are supplemental measures used by management and other users of our financial statements including our lenders and investors, to assess the financial performance of our business without regard to financing methods or capital structure. Adjusted EBITDA is also a key metric that management uses to assess the impact of potential strategic investing or financing opportunities. For example, management uses Adjusted EBITDA as a measure in determining the value of acquisitions, expansion opportunities, and dispositions. In addition, Adjusted EBITDA is used by financial institutions to measure borrowing capacity.

We define EBITDA as net income (loss) before: i) depreciation and amortization expenses, ii) provision for (recovery of) income taxes, and iii) finance costs. Adjusted EBITDA is calculated by adding to and deducting from EBITDA, as applicable, certain expenses, costs, charges or benefits incurred which in management's view are either not indicative of underlying business performance or impact the ability to assess the operating performance of our business, including i) unrealized foreign exchange gain or loss, ii) unrealized gain or loss on financial instruments, and iii) share-based compensation expenses, and iv) other items that may arise from time to time. We use Adjusted EBITDA to facilitate a comparison of our operating performance on a consistent basis reflecting factors and trends affecting our business.

Adjusted EBITDA margin represents Adjusted EBITDA divided by revenue. We use Adjusted EBITDA margin to facilitate a comparison of the operating performance on a consistent basis reflecting factors and trends affecting our business.

For a reconciliation of Adjusted EBITDA to the most directly comparable measure calculated in accordance with IFRS see the section entitled "Reconciliation of Non-IFRS Measures".

Adjusted Net Income and Adjusted Earnings per Share

Adjusted Net Income and Adjusted Earnings per Share (Adjusted EPS) are supplemental measures used by management and other users of our financial statements to assess the financial performance of our business adding to and deducting from net income, as applicable, certain expenses, costs, charges or benefits incurred which in management's view are either not indicative of underlying business performance or impact the ability to assess the operating performance of our business, including i) amortization of intangible assets related to business combinations, ii) unrealized foreign exchange gain or loss, iii) unrealized gain or loss on financial instruments, iv) share-based compensation expenses, and v) other items that may arise from time to time.

For a reconciliation of Adjusted Net Income to the most directly comparable measure calculated in accordance with IFRS see the section entitled "Results of Operations".

Adjusted Earnings per Share represents Adjusted Net Income divided by the weighted average number of shares outstanding.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024
M-4

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Order Bookings

Order Bookings is the dollar sum of contract values of firm customer contracts. Order Bookings is indicative of firm future revenues; however, it does not provide a guarantee of future net income and provides no information about the timing of future revenue.

Net Debt

Net Debt is the total carrying amount of long-term debt including current portions, as presented in the Q1 2025 Financial Statements, less cash and excluding any lease liabilities. Net Debt is a liquidity metric used to determine how well the Company can pay its debt obligations if they were due immediately.

Free Cash Flow

Free Cash Flow is a supplemental measure used by management and other users of our financial statements to monitor the availability of discretionary cash generated, and available to the Company to repay debt, make strategic investments, and meet other payment obligations. We define Free Cash Flow as operating cash flows less net capital expenditures.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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COMPANY OVERVIEW

MDA Space is a trusted mission partner of leading-edge space missions across the rapidly expanding global space economy. Our recognized engineering capabilities, portfolio of space technologies, and space mission expertise makes us a trusted partner of choice for a broad range of customers worldwide. We leverage our capabilities to enable next generation space exploration and infrastructure, space-based communication, and both earth and space observation missions. In an era where industries, technologies, people, and places are impacted every day by space technology, the mission of MDA Space is to build the space between proven and possible and to provide the space economy with our trusted and tested solutions. Our space technology solutions and services enable governments and businesses to develop and operate critical space infrastructure used for exploration and space-based science, to research, develop and operate space-based communications supporting our hyper-connected world, and to monitor global activities including climate change, illegal and unregulated fishing, and detection of oil spills. Our technologies and solutions are also deployed for defence and intelligence applications and space observation missions.

MDA Space has three business areas: Satellite Systems, Robotics & Space Operations, and Geointelligence. Our diversified portfolio of solutions serves many sectors of the space economy and positions our customers to achieve mission success. We are differentiated by factors including:

• our long track record of mission success and innovation in space spanning over 55 plus years and partnering on over 450 successful space missions;
• our global reach, with operations and significant customer base in Canada and the United States and expanding customer base in the UK, and other markets;
• our profitable operations;
• the breadth of our customer relationships, with a diversified government and commercial customer base;
• our experienced team of over 3,400 colleagues, comprised of experienced space engineers, scientists, technicians, business and space industry leaders which includes approximately 1,650 engineers averaging over seven years of tenure with MDA Space;
• consistent investment in research and development (R&D) and innovation, with MDA Space ranked in the top 35 corporate R&D investors in Canada;
• some of the most advanced equipment and facilities in the industry; and
• our portfolio of successful projects, technologies, and patents.

In Satellite Systems, we partner on space communication missions across low Earth orbit (LEO), medium Earth orbit (MEO), and geosynchronous equatorial orbit (GEO), in addition to providing communication systems for human rated spacecraft. These missions span a growing number of applications including broadband access, Direct-to-Device satellite communication, and Internet of Things (IoT) connectivity across the full communication frequency spectrum. In Robotics & Space Operations, we partner on space infrastructure missions to facilitate the exploration and development of space. We provide autonomous robotics and rover solutions along with proximity operation sensors that are used to operate in orbit and on the surface of the Moon and Mars, as well as operational services to plan, support and operate these missions remotely. In Geointelligence, we partner with customers to develop and operate earth observation (EO) and space observation missions, as well as providing key products in the areas of EO ground stations, maritime domain awareness software platforms, and multi-sensor fusion-based analytics products and services. All of these activities serve a wide range of use cases, including in the areas of national security, climate change monitoring, and maritime surveillance.

MDA Space's established position as a trusted mission partner can be traced to our investment in our people as well as our broad suite of technology and full lifecycle services. We work collaboratively with our customers in the early engineering phases of product and program development and provide services throughout a mission's life, including engineering, manufacturing, integration, mission operation, and ongoing maintenance services, enabling valuable customer intimacy that drives repeat revenue opportunities.

Our market position allows us to serve a broad range of customers, including governments and space agencies, commercial space companies and defence and aerospace prime contractors in the space industry. Our long and proven track record enables us to compete successfully for major Canadian space projects and to grow our international customer base. As an independent supplier of space technology products, we are also able to pursue a larger set of opportunities with U.S. prime contractors, which we believe can meaningfully enhance our revenue potential from U.S. government space programs.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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INDUSTRY OVERVIEW AND TRENDS

The benefits of space-based solutions are expected to grow significantly in the coming years, driven by continuous government and commercial investment in the increasing capabilities enabled by a burgeoning space economy. The space economy reached US$596¹ billion in 2024 and is expected to reach US$1.8 trillion by 2035.² This growth is expected to be driven by ongoing commercial and government investments in space, which reflects the importance of space in an increasingly global, sophisticated, and data-driven world.

Key trends that are impacting the space industry include:

• Lower costs and new technologies are driving the commercialization of space;
• Space is enabling global connectivity;
• Earth observation is critical to improving global sustainability and economic productivity;
• Robotics and on-orbit infrastructure is critical to the expanding Earth to Moon economy and future of Space;
• Space is critical to national security; and
• Space exploration is becoming interplanetary.

BUSINESS AREAS

MDA Space offers solutions and capabilities to meet global market demand through three business areas: Satellite Systems, Robotics & Space Operations and Geointelligence. Below is a brief description of each business area.

SATELLITE SYSTEMS

Satellite communications have transformed the way people connect and communicate on Earth and have continued to evolve to enable improved global connectivity across the globe. MDA Space serves our commercial and government mission partners worldwide as a prime contractor and supplier of satellite systems and sub-systems for communication networks in LEO, MEO and GEO satellites. These communication missions span a growing number of use cases including space-based broadband Internet, Direct-to-Device satellite communication, and IoT connectivity across the full communication frequency spectrum.

We have provided satellite subsystems to enable next generation LEO communication constellations such as O3b mPower, Iridium Next, and OneWeb; a segment of the communication satellite market that is driving meaningful growth for MDA Space. To support these high-volume satellite customers, MDA Space has continually adapted its satellite manufacturing base, which now includes fifth-generation robotics-based technologies capable of manufacturing dozens of small satellites and satellite sub-systems each month. MDA Space technology has been integrated into more than 350 satellite missions and we expect this number to continue to grow.

As we continue to evolve the Satellite Systems business, MDA Space is adding high-volume satellite production capabilities and capacity for large scale satellite constellations, including industry-leading satellite manufacturing leveraging automated production lines and robots, cobots and high-skilled assemblers using augmented reality to accelerate mass production. This advanced manufacturing environment is located at our industry leading facilities in Montreal, Quebec, which contain one of the largest near field ranges and largest compact ranges for satellite testing in the world. In addition, this facility includes a wide range of thermal, environmental, Platform Independent Model (PIM) and vibration test facilities. MDA Space has begun construction to double the company's manufacturing capacity to meet growing global demand.

MDA Space's continued transition to a satellite prime contractor for LEO and MEO constellations has been enabled by the launch of MDA AURORA™, its new leading-edge software-defined digital satellite product line. Designed to meet the changing and highly competitive technical and business requirements of the satellite industry, the fully integrated MDA AURORA™ portfolio provides operators with unparalleled flexibility and functionality. These software defined, dynamic beam forming satellites provide a new level of performance and efficiency in space based networks for our

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

¹ Source: Space Economy Report, NovaSpace, January 2025
² Source: The $1.8 Trillion Opportunity for Global Economic Growth, World Economic Forum, April 2024

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customers. The fully integrated digital satellite capability includes a complete range of modular digital products and components for space-based communication solutions coupled with advanced high-volume manufacturing production capability – dramatically enhancing constellation performance while reducing production costs and time to market.

Through our participation in multiple major satellite constellations to date, and with our new state-of-the-art high volume satellite production facility in Montreal, we have solidified our position as a trusted mission partner for space communications. Notable constellation awards include our selection in 2023 as the prime contractor for Telesat's revolutionary LEO satellite constellation Telesat Lightspeed (198 satellites) and the announcement that MDA Space was selected as the prime contractor for Globalstar Inc. (Globalstar) next generation LEO constellation (more than 50 satellites). In 2022, MDA Space was selected as the prime contractor to expand Globalstar's existing LEO constellation (17 satellites).

• Key Program – Globalstar LEO Constellation Expansion: In 2022, Globalstar announced that MDA Space has been selected as the prime contractor for Globalstar's new LEO satellites. Globalstar is a provider of Mobile Satellite Services including customizable satellite IoT solutions for individuals and businesses globally. Globalstar's contract with MDA Space, valued at US$327 million (~$415 million) includes the design, manufacture, assembly and test of 17 satellites, with options for Globalstar to purchase up to nine additional satellites. The satellites built by MDA Space will integrate with Globalstar's existing constellation. In 2022, Globalstar disclosed that Apple Inc. is the primary customer for its current and future satellite network capacity which will support new satellite-enabled services for certain of Apple's products.
• Key Program – Telesat Lightspeed Constellation: In 2023, Telesat announced that MDA Space has been selected as the prime contractor for the Telesat Lightspeed program, Telesat's revolutionary LEO satellite constellation. Valued at approximately $2.4 billion, MDA's contract includes the design, manufacture, assembly and test of 198 satellites with options for Telesat to purchase up to 100 additional satellites. The Telesat Lightspeed satellites will be built, assembled and tested at MDA Space's state-of-the-art high volume satellite manufacturing facilities in Montreal and will leverage MDA's strategic investments in new digital satellite product portfolio and advanced manufacturing capability to deliver significant cost and schedule benefits to the program.
• Key Program – Globalstar Next Generation LEO Constellation: In 2025, MDA Space announced that it has been selected by Globalstar to be the prime contractor for the satellite operator's next generation LEO constellation, with a total contract value of approximately $1.1 billion. As part of the contract, MDA Space will manufacture more than 50 MDA AURORA™ software-defined digital satellites for Globalstar. The contract is a follow-on to an initial Authorization to Proceed (ATP) contract with Globalstar, previously announced on November 17, 2023. A contract value of approximately $750 million was added to the Company's backlog in the first quarter of fiscal 2025. This amount is in addition to the ATP value of approximately $350 million that was previously added to backlog, for a total value of $1.1 billion under the contract. The satellites built by MDA Space will provide Globalstar with more capacity and flexibility to address its customers' needs. On November 1, 2024, Globalstar disclosed that it has entered into an agreement with its customer, Apple Inc., to deliver expanded services to the customer over a new mobile satellite services network, including a new satellite constellation.

ROBOTICS & SPACE OPERATIONS

In our Robotics & Space Operations business, we partner with customers in critical, leading-edge space infrastructure missions. MDA Space enables the exploration and development of space infrastructure by providing autonomous robotics and sensors used to operate in space and on the surfaces of the Moon and Mars. MDA Space is a world leader in space-based robotics including over 100 space shuttle missions, assembly of the International Space Station (ISS), life-cycle operation of the ISS and our rover technology on Mars. The space infrastructure missions we partner on span broad space-based applications, including space station operations, ISAM, and the emerging markets of space tourism and space mining. Our differentiated capabilities include robotic systems, robotic interfaces, tooling, robotic ground control stations and operations services, electro-optic and light detection and ranging (LiDAR) sensors, vision and targeting systems, guidance, navigation and control subsystems and planetary rover locomotion subsystems. Our LiDAR sensors are critical to proximity operations supporting mission elements such as rendezvous, docking, inspection, and landing activities as part of on-orbit and planetary missions.

We are also developing commercial space robotic solutions that serve the evolving needs of the new space market. This includes MDA SKYMAKER™, a new suite of space robotics announced in 2024 to meet the diverse needs of our

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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customers' most ambitious missions. Derived from Canadarm technology, MDA SKYMAKER™ provides our customers with access to the world's most flight-proven space robotics solutions and services, supporting a range of missions including lunar surface rovers and landers, space stations, satellite servicing in all orbits, and ISAM. Our products and services support logistics delivery, satellite servicing, debris removal, asset relocation, and infrastructure maintenance. Through focused investment in R&D, we have developed integrated space robotic systems, technologies, interfaces, tools, operational techniques and control algorithms to enable on-orbit servicing solutions for commercial space businesses. We have completed multiple commercial sales of products derived from Canadarm3 technology and are also a strategic partner and equity owner in Starlab Space LLC, a global joint venture that is designing and building the Starlab commercial space station. MDA Space joined the Starlab team to provide the full range of external robotics, robotics interfaces and robotics mission operations to the station.

Demand for space robotics and mission-support services is primarily driven by increasing activity in LEO, lunar and deep space exploration, all of which are expected to expand with the introduction of new commercial space stations and commercial planetary missions in the coming years. The increase in the number of satellites and other spacecraft is driving demand for emerging solutions in on-orbit servicing (e.g., the upgrade and repair, relocation and refueling of satellites in orbit) and manufacturing. Our long history in space robotics includes development of the Canadarm for NASA's Space Shuttle program, and Canadarm2, which is currently in service on the ISS.

We are continuing to work on the Canadarm3 program, our third generation Canadarm that will provide AI-based robotics for the NASA-led Gateway, the lunar-orbiting outpost of the Artemis program. Current projects, including Canadarm3, are expanding MDA Space's mission partner scope to now include on-orbit operations. MDA Space moved into its new headquarters and space robotics centre of excellence in March 2024. Our investment, and construction of, these new facilities included the creation of multiple mission control centers enabling us to provide on-orbit operations for our customers in the future.

We have developed technology for multiple Mars missions, including the Phoenix Lander, the Curiosity Rover and the ExoMars Rover, with our sensors first operating on Mars in 2008. We also built the LiDAR instrument for the OSIRIS-Rex mission that completed the world's first 3D scan of an asteroid from an orbiting spacecraft.

• Key Program – Canadarm3: Canadarm3, the third-generation robotic technology developed by MDA Space, will be designed and built over a multi-year period and is expected to generate approximately $1.8 billion of potential total revenue to the Company, including fifteen years of ongoing service and support revenue. MDA was awarded the Phase B contract ($269 million) in March 2022 to complete the preliminary design of the Canadarm3 robotic arm and awarded Phases C/D contract ($1 billion) in June 2024 to finalize the design and carry out the construction, system assembly and integration and test. This advanced AI-enabled robotic system will be highly autonomous, allowing the robotic elements to perform operations and make decisions during long periods when there is no contact with the Canada-based ground control operations centre. We are also working on commercializing the Canadarm3 robotic arm capabilities for applications in the growing on-orbit servicing and in-space manufacturing and assembly markets.

GEOINTELLIGENCE

As a Geointelligence mission partner, we are an owner, operator, and prime contractor for both EO and space observation missions, in addition to providing key technologies and products. We also use satellite-generated imagery and data to deliver critical and value-added insights for a wide range of end uses, including in the areas of national security, climate change monitoring and maritime surveillance.

Our Geointelligence business is a leader in Synthetic Aperture Radar (SAR) EO missions, which we both own and operate ourselves as well as deliver to customers and operate for them. We have designed and built three generations of SAR satellites (RADARSAT-1, RADARSAT-2, and the RADARSAT Constellation Mission). We also specialize in space observation satellites including the Sapphire mission that MDA Space developed and delivered to Canada's Department of National Defence. Following delivery of observation missions to customers, MDA Space is regularly entrusted to operate those missions for customers with MDA Space currently operating most of the Canadian government's earth and space observation satellites.

A key enabling product suite in EO is our full range of multi-satellite ground stations that receive, process, distribute, archive, and exploit imagery from RADARSAT-2, MDA Space's own commercial EO satellite, as well as other satellites. We have installed more than 70 receiving ground stations in more than 25 different countries, which have processed data from over 20 different satellites.

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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Our EO business includes the collection, processing and dissemination of earth imagery data from space. As the operator and owner of global commercial data distribution for the RADARSAT-2 satellite we are one of the largest radar information providers worldwide. Our extensive data archive is comprised of approximately 90 billion square kilometers of Earth imagery data and more than one million images of Earth. We also distribute high resolution optical imagery, satellite-based Automatic Identification System (AIS) data, and Radio-Frequency (RF) data from many other third party missions. Our analytics-based information products regularly fuse these different sensor types into the information our customers require. As a result, our imagery solutions provide customers with timely, accurate and mission-critical information about our changing planet and support a wide variety of uses and sectors.

The largest market for our EO data and services today is maritime domain awareness, where governments and commercial organizations rely on us for real-time data. The data is used to track maritime activity, visualize maritime crime patterns, identify and monitor illegal, unreported and unregulated fishing, track ice floes, shorelines and ocean winds, detect possible oil spills and monitor vessels. We have been a provider of these mission critical data and services for over 25 years and we play an integral role in our customers' surveillance strategies. We have also developed the Maritime Insights analytics platform that provides users with a software to monitor maritime areas of interest through the fusion and display of multiple sensor inputs.

MDA Space also provides a number of defence information solutions, including command and control systems and airborne surveillance solutions, for which we are the original solution provider of many of these systems. Part of our offerings include advanced aeronautical navigation information solutions that increase safety and efficiency of aircraft landings and departures. We also operate a long endurance uncrewed aerial vehicle surveillance service that provides real-time, multi-sensor intelligence to support critical operations.

> Key Development Initiative – MDA CHORUS™: We are currently developing MDA CHORUS™, a next-generation collaborative multi-sensor satellite constellation that will provide data continuity for RADARSAT-2 and is expected to expand our EO solutions offering. MDA CHORUS™ will fuse data from multiple sensors and will leverage machine learning in order to manage larger volumes of data and provide enhanced analytics services. MDA CHORUS™ is expected to operate in an inclined LEO and will provide frequent imaging day or night and in all weather conditions over the areas of most interest to our customers. The mission is expected to include significant innovations that result in improved access, better revisit, broader swath coverage, lower noise, less data compression, faster data rates, high-resolution and tip-and-cue capabilities. The MDA CHORUS™ constellation will include a powerful C-band SAR satellite that will provide broad area coverage in concert with a smaller trailing X-band SAR satellite for higher resolution data collection and near real-time cross-cueing. MDA CHORUS™ will also include a cloud-based ground station solution as a next-generation offering.

COMPETITIVE STRENGTHS

While the markets we serve are competitive, we believe that MDA Space is well positioned to provide differentiated solutions to customers, driven by the following competitive strengths:

• A trusted mission partner with a track record of execution;
• Specific expertise and technological resources tailored for the new space economy;
• Agility and scale position us to serve customers of all levels of size and experience;
• Deep team with a winning culture; and
• Entrepreneurial go-to-market strategy.

GROWTH STRATEGIES

With established industry leadership in diverse space markets, we are currently executing on specific strategies that will allow us to capitalize on the multiple waves of growth in the expanding space market. The primary pillars of our strategy include:

• Investing in next generation space technology and services;
• Expanding our presence in attractive markets and geographies;
• Scaling and expanding operations, skills and talent; and
• Leveraging strategic M&A to complement organic growth.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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QUARTERLY HIGHLIGHTS

• Backlog of $4.8 billion at quarter-end provides good revenue visibility for 2025 and beyond and was up 46.1% compared to Q1 2024. The year-over-year increase in backlog is driven by new order bookings including the Globalstar next generation LEO constellation award announced in Q1 2025.
• Revenues of $351.0 million in Q1 2025 were up 67.9% year-over-year driven by higher revenues across our business areas with strong contributions from Satellite Systems business.
• Adjusted EBITDA⁽¹⁾ of $68.6 million in Q1 2025 compared to $42.0 in Q1 2024, representing an increase of 63.3% year-over-year driven by higher volumes of work. Adjusted EBITDA margin⁽¹⁾ was 19.5% in Q1 2025, in line with 20.1% reported in Q1 2024 and consistent with the Company's full year margin guidance of 19%-20%.
• Net income of $32.9 million in Q1 2025 was up 138.4% year-over-year primarily due to higher operating income. Diluted earnings per share of $0.26 in Q1 2025 compared to $0.11 in Q1 2024, representing an increase of 136.4% year-over-year.
• Adjusted net income for Q1 2025 was $37.2 million compared to $18.3 in Q1 2024, representing an increase of 103.3% year-over-year driven by higher operating income. Adjusted diluted earnings per share of $0.29 in Q1 2025 compared to $0.15 in Q1 2024, representing an increase of 93.3% year-over-year.
• Operating cash flow was $267.0 million in Q1 2025 compared with $24.7 million in Q1 2024. The year-over-year increase in operating cash flow was driven by positive working capital contributions primarily related to the Globalstar next generation LEO constellation and Telesat Lightspeed constellation programs.
• Net cash position of $376.3 million at quarter-end, compared to a net cash position of $166.7 million as of December 31, 2024 as the Company utilized its strong operating cash flow in 2024 to deleverage the balance sheet.
• In the first quarter, notable activities included the following:
• Our Satellite Systems business was awarded an approximately $1.1 billion contract from Globalstar to act as the prime contractor for the satellite operator's next generation LEO constellation. As part of the contract for the full LEO constellation, MDA Space will manufacture more than 50 MDA AURORA™ software-defined digital satellites for Globalstar. The contract is a follow-on to an initial Authorization to Proceed (ATP) contract with an undisclosed customer, previously announced on November 17, 2023. A contract value of approximately $750 million was added to the Company's backlog in the first quarter of fiscal 2025. This amount is in addition to the ATP value of approximately $350 million that was previously added to backlog, for a total value of $1.1 billion under the contract.
• Subsequent to quarter-end, MDA Space announced that it has entered into a definitive agreement to acquire all outstanding shares of SatixFy Communications Ltd. in an all-cash transaction for US$2.10 per share. The transaction, which represents an equity value for SatixFy of approximately US$193 million (approximately $278 million), is expected to further enhance the end-to-end satellite systems offering of MDA Space as demand for next generation digital satellite communications continues to accelerate. As part of the transaction, MDA Space also intends to retire SatixFy's existing debt of approximately US$76 million (approximately $109 million) immediately upon closing, which represents a total cash consideration of approximately US$269 million (approximately $387 million) for the transaction. This acquisition follows the Company's previous acquisition of SatixFy's digital payload division in August of 2023. The Company expects the transaction to close in the third quarter of 2025 subject to customary closing conditions and required regulatory approvals.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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FINANCIAL OVERVIEW

KEY INDICATORS SUMMARY

	First Quarters Ended March 31,
(in millions of Canadian dollars, except per share data)	2025	2024
Revenues	$ 351.0	$ 209.1
Gross profit	$ 79.7	$ 57.9
Gross margin	22.7%	27.7%
Adjusted EBITDA	$ 68.6	$ 42.0
Adjusted EBITDA margin	19.5%	20.1%
Adjusted Net Income	$ 37.2	$ 18.3
Adjusted Diluted EPS	$ 0.29	$ 0.15
		As at
(in millions of Canadian dollars, except for ratios)	March 31, 2025	December 31, 2024
Backlog	$ 4,838.4	$ 4,385.5
Net debt to Adjusted TTM EBITDA ratio	(1.5)x	(0.8)x

REVENUES BY BUSINESS AREA

	First Quarters Ended March 31,
(in millions of Canadian dollars)	2025	2024
Geointelligence	$ 51.7	$ 51.5
Robotics & Space Operations	77.3	70.6
Satellite Systems	222.0	87.0
Consolidated revenues	$ 351.0	$ 209.1

Revenues

Consolidated revenues for the first quarter of 2025 were $351.0 million, representing an increase of $141.9 million (or 67.9%) from the first quarter of 2024. The year-over-year increase was driven by higher revenues across our business areas with strong contributions from our Satellite Systems business.

By business area, revenues in Geointelligence for the first quarter of 2025 were $51.7 million, which represents an increase of $0.2 million (or 0.4%) from the same period in 2024. Revenues in Robotics & Space Operations for the first quarter of 2025 were $77.3 million, which represents an increase of $6.7 million (or 9.5%) from the same period in 2024 driven by the ramp of Phase C of the Canadarm3 Program which was awarded in Q2 2024. Revenues in Satellite Systems for the first quarter of 2025 were $222.0 million, which represents an increase of $135.0 million (or 155.2%) from the same period in 2024 driven by the ramp up of the Telesat Lightspeed program and the Globalstar next generation LEO constellation program, the latter definitized in February 2025.

Gross Profit and Gross Margin

Gross profit reflects our revenues less cost of revenues. Q1 2025 gross profit of $79.7 million represents a $21.8 million (or 37.7%) increase over Q1 2024 driven by higher volumes of work performed in our Satellite Systems and Robotics & Operations businesses. Gross margin in Q1 2025 was 22.7%, which is in line with our expectations, and compares to a gross margin of 27.7% in Q1 2024 driven by an evolving program mix.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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Adjusted EBITDA and Adjusted EBITDA Margin

Adjusted EBITDA for the first quarter of 2025 was $68.6 million compared with $42.0 million for the first quarter of 2024, representing an increase of $26.6 million (or 63.3%) year-over-year driven by higher work volumes as we continue to execute on our backlog. Adjusted EBITDA margin was 19.5% for the first quarter of 2025, in line with the 20.1% adjusted EBITDA margin reported for the first quarter of 2024 and consistent with the Company's full year margin guidance of 19%-20%.

Adjusted Net Income

Adjusted net income for the first quarter of 2025 was $37.2 million compared with $18.3 million for the first quarter of 2024, representing an increase of $18.9 million (or 103.3%) year-over-year largely due to higher operating income in Q1 2025.

Backlog

Backlog is comprised of our remaining performance obligations which represents the transaction price of firm orders less inception to date revenue recognized and excludes unexercised contract options and indefinite delivery or indefinite quantity contracts. Backlog as at March 31, 2025 was $4,838.4 million, an increase of $1,526.2 million compared with the backlog at March 31, 2024 driven by new order bookings partially offset by continued conversion of our backlog into revenue. The following table shows the build up of backlog for three months ended March 31, 2025 as compared with the same periods in 2024.

	First Quarters Ended March 31,
(in millions of Canadian dollars)	2025	2024
Opening Backlog	$ 4,385.5	$ 3,097.0
Less: Revenue recognized	(351.0)	(209.1)
Add: Order Bookings	803.9	424.3
Ending Backlog	$ 4,838.4	$ 3,312.2

2025 FINANCIAL OUTLOOK

As a trusted mission partner and leading global space technology provider, we are leveraging our capabilities and expertise to execute on targeted growth strategies across our end markets and business areas. Our strategic initiatives, which span across our three businesses, include investing in next generation space technology and services, expanding our presence in high growth markets and geographies, scaling and expanding skills, talent and operations to meet current and future market demand and leveraging strategic M&A to complement organic growth. We continue to make good progress against our long-term strategic plan.

MDA Space is well positioned to capitalize on strong customer demand and robust market activity given our diverse and proven technology offerings. Our growth pipeline is significant and underpinned by existing and new programs and our book of business is healthy. We see activities ramping up in line with our expectations and are encouraged by the team's solid execution.

For fiscal 2025, we reaffirm the previous outlook provided in our Q4 2024 earnings release and continue to expect full year revenues to be $1.50 – $1.65 billion, representing year-over-year growth of approximately 45% at the mid-point of guidance. We continue to expect full year adjusted EBITDA to be $290 – $320 million, representing year-over-year growth of approximately 40% at the mid-point of guidance, and approximately 19% – 20% adjusted EBITDA margin. We reaffirm our expectations that capital expenditures will be $210 – $240 million in 2025, comprising of growth investments to support the previously outlined growth initiatives across our business areas. We continue to expect full year free cash flow to be neutral to positive in 2025.

For Q2 2025, we expect revenues to be $360 – $380 million as we continue to execute on our backlog.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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Note that the provided 2025 financial outlook does not incorporate any potential impact from the U.S. tariffs announced this year on articles imported from Canada or the retaliatory Canadian tariffs imposed on Canadian imports from the U.S. MDA Space continues to work collaboratively with our customers to identify solutions and explore mitigation strategies. The Company will continue to closely monitor developments and may elect to update its financial outlook if deemed necessary.

RESULTS OF OPERATIONS

(in millions of Canadian dollars, except per share data)	First Quarters Ended March 31,
	2025	2024
Revenues	$ 351.0	$ 209.1
Materials, labour and subcontractors costs	(257.6)	(140.7)
Depreciation and amortization of assets	(13.7)	(10.5)
Gross profit	$ 79.7	$ 57.9
Operating expenses:
Selling, general & administration	$ (23.4)	$ (18.9)
Research & development, net	(5.5)	(9.0)
Amortization of intangible assets	(11.6)	(12.3)
Share-based compensation	(3.9)	(2.5)
Operating income	$ 35.3	$ 15.2
Other income	13.2	9.7
Finance income	1.7	0.7
Finance costs	(4.9)	(6.1)
Income before income taxes	$ 45.3	$ 19.5
Income tax expense	(12.4)	(5.7)
Net income	$ 32.9	$ 13.8
Basic earnings per share	$ 0.27	$ 0.12
Diluted earnings per share	0.26	0.11

Revenues

Consolidated revenues for the first quarter of 2025 were $351.0 million, representing an increase of $141.9 million (or 67.9%) compared with the first quarter of 2024. Please refer to 'Financial Overview' for a detailed discussion of revenue drivers for the three months ended March 31, 2025.

Materials, labour and subcontractors costs

Materials, labour and subcontractor costs for the first quarter of 2025 were $257.6 million, representing a $116.9 million (or 83.1%) increase compared to the same quarter of 2024. The increase is due to higher volume of work performed as we execute on our backlog.

Depreciation and amortization of assets

Included in this line item are the depreciation and amortization costs of those assets directly used to support our revenues. These assets are depreciated and amortized on a straight-line basis over their useful lives. First quarter costs of $13.7 million represents an increase of $3.2 million (or 30.5%) compared with the first quarter of 2024. The year-over-year increase is primarily due to the depreciation and amortization of assets placed into service throughout 2024.

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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Selling, general and administration (SG&A)

SG&A expenses include administrative support functions, as well as business development and bids and proposals costs. In addition, audit fees, public company expenses, recruitment and other consulting fees are included in this line item. SG&A expenses for the first quarter of 2025 were $23.4 million, representing an increase of $4.5 million (or 23.8%) over the same quarter in 2024. The increase in SG&A expenses in 2025 reflects an expansion of our SG&A functions. For the three months ended March 31, 2025, SG&A expenses were 6.7% of revenues compared to 9.0% for the same period in 2024, reflecting economies of scale as work volume grows.

Research and development (R&D)

R&D expenses are comprised of costs incurred on R&D activities that are expensed to the income statement in the period, offset by funding received on certain R&D programs. The Company expenses research costs as they are incurred. Development costs are expensed when they do not meet the asset capitalization criteria (e.g. when technical feasibility and/or a market has not yet been established), or the costs are not directly attributable to developing the asset.

Net R&D expense for the first quarter of 2025 was $5.5 million, representing a decrease of $3.5 million (or 38.9%) from the same quarter in 2024. The year-over-year decrease in R&D expense is primarily due to lower activity on the development of MDA CHORUS™, where a portion of the costs are expensed in R&D as they do not qualify for asset capitalization.

Amortization of intangible assets

This line item includes the straight-line amortization of intangible assets recognized as part of the Acquisition on April 8, 2020, and the acquisition of SatixFy Space Systems UK Ltd. in Q4 2023. Intangible assets are comprised of contractual backlog, customer relationships, proprietary technologies, and the MDA trademark. These intangible assets are amortized over various useful lives, ranging from 2 to 20 years. The amount expensed in the first quarter of 2025 was $11.6 million, representing a decrease of $0.7 million (or 5.7%) compared with the first quarter of 2024. The year-over-year decrease in the quarter is attributable to a portion of contractual backlog assets being fully amortized in Q1 2024 partially offset by increased amortization of proprietary technology resulting from the purchase of SatixFy Space Systems, which is being amortized over 7 years.

Share-based compensation

In April 2021, the Company established an Omnibus Long-term Incentive Plan (Omnibus Plan). The Omnibus Plan is a share-based plan, under which the Company can issue stock options, deferred share units (DSUs), restricted share units (RSUs), and performance share units (PSUs) to directors and employees. The Company also has in place an Employee Share Trust Agreement arrangement, where eligible employees are issued shares held in a company trust (Trustee Shares) and released upon meeting prescribed conditions.

Further, in the second quarter of 2024, the Company established an employee share purchase plan (ESPP). The ESPP is a cash-settled share-based payment plan whereby employees of the Company can acquire common shares through regular payroll deductions. The Company matches the employees contribution up to a maximum of five thousand dollars per year per employee.

Share-based compensation expense represents the vesting of the Company's share-based awards on a graded basis over the awards' respective vesting periods.

Share-based compensation expense for the first quarter of 2025 was $3.9 million, which represents an increase of $1.4 million (or 56.0%) over the first quarter of 2024. This increase is mainly due to the introduction of the ESPP in Q2 2024.

Other income

Other income includes amounts related to foreign exchange gains (losses), unrealized gains (losses) on financial instruments and other financial adjustments not related to our core business practices.

During the first quarter of 2025, other income was $13.2 million, mostly comprising of $13.1 million of foreign exchange gain. The foreign exchange gain is due to the weakening Canadian dollar compared to the main foreign currencies in which the Company transacts. During the first quarter of 2024, other income was $9.7 million, comprising of $0.9 million

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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in unrealized gain on financial instruments, $2.3 million in foreign exchange gain, $5.8 million financial gain related to the sale of the Company's terrestrial nuclear services assets and a gain of $0.7 million related to a past provision on an expired lease.

Finance income

Finance income represents the interest income earned on deposits, tax interest income and interest income of assets of defined benefit pension plans.

Finance income for first quarter of 2025 was $1.7 million, compared to $0.7 million for the first quarter of 2024, reflecting higher cash balances, higher interest returns on assets of defined benefits pension plans and tax interest true-ups.

Finance costs

The Company's finance costs may include interest expense, interest on lease liabilities, net interest accrual on interest rate swaps, borrowing fees, and gains or losses on modifications of debt facilities, net of capitalized interest expense on certain qualifying capital assets under internal development.

Finance costs for the first quarter of 2025 were $4.9 million, primarily due to interest on lease liabilities. Finance costs for the first quarter of 2024 were $6.1 million, net of $3.9 million of capitalized interest expense. The year-over-year decrease of $1.2 million is due to lower borrowing costs in Q1 2025 as the Company repaid all amounts outstanding on its credit facility in Q4 2024.

Income Tax Expense

Income tax expense represents current and deferred taxes. For the first quarter of 2025, we recognized an income tax expense of $12.4 million on income before income taxes of $45.3 million and representing an effective tax rate of 27.4%. For the first quarter of 2024, income tax expense was $5.7 million recorded on income before income taxes of $19.5 million and representing an effective tax rate of 29.2%. The lower effective tax rate in Q1 2025 was mainly due to permanent differences in the quarter.

Net income

Net income for the first quarter of 2025 was $32.9 million compared to $13.8 million of net income reported in the first quarter of 2024. The year-over-year increase of 138.4% was driven by higher operating income compared to Q1 2024.

RECONCILIATION OF NON-IFRS MEASURES

The following tables provide a reconciliation of net income to EBITDA, adjusted EBITDA, and adjusted net income:

(in millions of Canadian dollars)	First Quarters Ended March 31,
	2025	2024
Net income	$ 32.9	$ 13.8
Depreciation and amortization of assets	13.7	10.5
Amortization of intangible assets related to business combination	11.6	12.3
Income tax expense	12.4	5.7
Finance income	(1.7)	(0.7)
Finance costs	4.9	6.1
EBITDA	$ 73.8	$ 47.7
Unrealized foreign exchange gain	(11.4)	(1.5)
Unrealized gain on financial instruments	(0.1)	(0.9)
Gain on disposal of assets	—	(5.8)
Acquisition, integration and reorganization costs	3.5	—
Equity-settled share-based compensation	2.8	2.5
Adjusted EBITDA	$ 68.6	$ 42.0

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024
M-17

(in millions of Canadian dollars except for adjusted earnings per share)
	2025	2024
Net income	$ 32.9	$ 13.8
Amortization of intangible assets related to business combination	11.6	12.3
Acquisition, integration and reorganization costs	3.5	—
Gain on disposal of assets	—	(5.8)
Unrealized gain on financial instruments	(0.1)	(0.9)
Net foreign exchange gain	(13.1)	(2.3)
Embedded derivative effects	1.1	0.4
Equity-settled share-based compensation	2.8	2.5
Income taxes related to the above items (1)	(1.5)	(1.7)
Adjusted net income	$ 37.2	$ 18.3
Weighted average number of shares outstanding - diluted	127,589,192	123,263,439
Adjusted earnings per share - diluted	$ 0.29	$ 0.15

(1) Statutory income tax rate of 26.5% applied

FINANCIAL CONDITION, LIQUIDITY & CAPITAL RESOURCES

Financial Condition

Total assets of the Company as at March 31, 2025 were $2,850.8 million, representing a $253.3 million increase from $2,597.5 million as at December 31, 2024. The increase in asset balances reflects our strong cash position and continued investments to support our growth initiatives.

Total liabilities as at March 31, 2025 of $1,635.6 million increased by $214.1 million compared with $1,421.5 million as at December 31, 2024 primarily reflecting the increase in our contract liabilities.

The following table represents our working capital position as at March 31, 2025 and December 31, 2024:

(in millions of Canadian dollars)
	March 31, 2025	December 31, 2024
Non-cash current assets	$ 474.8	$ 459.8
Current liabilities	1,308.5	1,091.0
Net Working Capital	$ (833.7)	$ (631.2)

Our Net Working Capital decreased by $202.5 million from December 31, 2024 to March 31, 2025. This decrease is largely due to higher contract liabilities and accounts payable, somewhat offset by higher unbilled receivables and trade receivables at March 31, 2025 relative to December 31, 2024.

Management monitors net working capital levels on a continuous basis, to ensure the Company has sufficient liquidity to fund its short-term usages of cash necessary in the normal course of operations.

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Cash Flows

The Company's consolidated cash flows are summarized in the table below.

	First Quarters Ended March 31,
(in millions of Canadian dollars)	2025	2024
Cash, beginning of period	$ 166.7	$ 22.5
Total cash provided by (used in):
Operating activities	$ 267.0	$ 24.7
Investing activities	(61.5)	(44.4)
Financing activities	6.3	27.7
Net foreign exchange difference	(2.2)	(1.2)
Increase in cash	$ 209.6	$ 6.8
Cash, end of period	$ 376.3	$ 29.3

For the first quarter of 2025, the net increase in cash was $209.6 million which compares to a net increase in cash of $6.8 million for Q1 2024. Operating activities in the latest quarter generated $267.0 million of cash compared to $24.7 million in Q1 2024. Operating cash flow in the latest quarter was driven by favourable working capital contributions primarily from the Globalstar next generation LEO constellation and Telesat Lightspeed constellation programs. Cash used in investing activities was $61.5 million in Q1 2025 related to capital expenditures. In Q1 2024, cash used in investing activities was $44.4 million comprised of capital expenditures of $40.2 million and payments of $11.6 million related to the acquisition of SatixFy Space Systems UK Ltd., which were offset by $7.4 million related to the sale of our terrestrial nuclear assets. Cash inflows from financing activities in the latest quarter were $6.3 million compared with cash inflow of $27.7 million for the same period in 2024.

Capital Management

The Company defines its capital as the aggregate of long-term debt and shareholder's equity. The Company's primary capital management objectives are to provide an appropriate return to shareholders, safeguard working capital over the annual operating cycle, provide financial resources to grow operations to meet long-term customer demand, and comply with financial covenants under credit facilities.

The Company's strategy to manage its capital structure is to utilize its borrowing arrangements to obtain operating credit facilities in support of its working capital and planned capital expenditures. When needed, the Company also has access to capital markets to raise equity financing. At March 31, 2025, the Company's outstanding debt stood at nil, compared to nil million at December 31, 2024.

As at March 31, 2025, the Company was in a positive net cash position of $376.3 million. Net debt to adjusted trailing twelve month (TTM) EBITDA ratio was (1.5)x, compared with (0.8)x as at December 31, 2024.

As at

(in millions of Canadian dollars, except for ratios)	March 31, 2025	December 31, 2024
Long-term debt	$ —	$ —
Less: Cash	(376.3)	(166.7)
Net Debt (Cash)	$ (376.3)	$ (166.7)
Adjusted TTM EBITDA	$ 243.7	$ 217.1
Net Debt to Adjusted TTM EBITDA	(1.5)x	(0.8)x

As at March 31, 2025, the Company had total liquidity of $1,066.7, which includes cash of $376.3 and $690.4 million of available liquidity under its revolving credit facility, net of outstanding letters of credit and final settlement related to the SatixFy acquisition from 2023. The Company continually assesses the adequacy of its capital structure and capacity and makes adjustments within the context of the Company's strategy, economic conditions, and the risk characteristics of the business. The Company has ample liquidity to fund working capital requirements of its operations, capital expenditures, debt service costs, and general corporate costs.

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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As at March 31, 2025, the Company was in compliance with the financial covenants under the Company's credit facilities.

Equity was $1,215.2 million as at March 31, 2025 compared with $1,176.0 million as at December 31, 2024.

As at March 31, 2025, the Company had commitments of $94.2 million (December 31, 2024: $66.2 million) relating to purchase of property, plant and equipment, and intangible assets and had commitments of 7.9 million over 10 years (December 31, 2024 – $8.7 million over 10 years) relating to leases not yet commenced.

FINANCIAL INSTRUMENTS

The Company's financial assets include cash, trade and other receivables, investments in equity securities, and derivative assets. Financial liabilities include accounts payable and accrued liabilities, long-term debt, and derivative liabilities.

The Company's activities expose its financial instruments to a variety of risks: interest rate risk, liquidity risk, foreign exchange risk, and credit risk. Risk management is carried out by the Company by identifying and evaluating the financial risks inherent within its operations. The Company's overall risk management activities seek to minimize potential adverse effects on the Company's financial performance.

Descriptions of financial instrument risks along with how they are managed are disclosed in the Company's MD&A for the year ended in December 31, 2024 as well as in note 20 of the 2024 Audited Financial Statements. There were no significant changes to financial instrument risks in the first quarter of 2025.

OFF-BALANCE SHEET ARRANGEMENTS

The Company has off-balance sheet arrangements in the form of standby letters of credit used mainly in connection with obligations relating to performance and payment guarantees of customer contracts. As at March 31, 2025, the aggregate gross potential liability related to the Company's letters of credit was approximately $6.8 million (December 31, 2024: $6.8 million).

As at March 31, 2025 and December 31, 2024, the Company had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company's financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

TRANSACTIONS BETWEEN RELATED PARTIES

The Company's related parties are its key management personnel. Key management personnel have authority and responsibility for overseeing, planning, directing, and controlling its activities and consist of the members of the board and the senior members of the management team. For the first quarter of 2025, the nature and extent of related party transactions were not materially different from those disclosed in note 27 of the 2024 Audited Financial Statements.

SIGNIFICANT ACCOUNTING POLICIES, ESTIMATES, AND JUDGMENTS

The Company's Q1 2025 Financial Statements have been prepared in accordance with IAS 34 Interim Financial Reporting, using accounting policies consistent with IFRS Accounting Standards as issued by the International Accounting Standards Board. The same accounting policies and methods of computation as those used in the preparation of the 2024 Audited Financial Statements were followed in the preparation of the Q1 2025 Financial Statements.

A summary of the Company's material accounting policies is disclosed in note 3 of the 2024 Audited Financial Statements.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024
M-19

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Critical accounting estimates and judgments

The preparation of the consolidated financial statements in conformity with IFRS Accounting Standards requires management to make estimates and judgments that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.

Information about critical judgements in applying accounting policies that have the most material effects on the amounts recognized in the consolidated financial statements is disclosed in note 2 of the 2024 Audited Financial Statements.

RECENT ACCOUNTING PRONOUNCEMENTS

Forthcoming Issuance of IFRS 18 Presentation and Disclosure in Financial Statements replacing IAS 1, Presentation of Financial Statements

IFRS 18 aims to achieve comparability of the financial performance of similar entities and will impact the presentation of primary financial statements and notes, including the statement of earnings where companies will be required to present separate categories of income and expense for operating, investing, and financing activities with prescribed subtotals for each new category. The standard will also require management-defined performance measures to be explained and included in a separate note within the consolidated financial statements. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, with earlier application permitted. Management is currently assessing the impact of adopting IFRS 18 on its consolidated financial statements.

SUMMARY OF QUARTERLY RESULTS

The following table provides select unaudited quarterly financial results for the eight most recently completed quarters.

	2025	2024				2023
(in millions of Canadian dollars, except per share data)	Q1	Q4	Q3	Q2	Q1	Q4	Q3	Q2
Backlog	$ 4,838.4	$ 4,385.5	$ 4,578.1	$ 4,596.0	$ 3,312.2	$ 3,097.0	$ 3,068.7	$ 1,098.3
Revenues	351.0	346.6	282.4	242.0	209.1	205.0	204.7	196.0
Gross profit	79.7	81.9	75.7	66.2	57.9	57.8	57.7	61.3
EBITDA	73.8	66.9	64.0	44.2	47.7	34.2	37.1	34.9
Adjusted EBITDA	68.6	70.9	55.5	48.7	42.0	42.1	42.8	40.4
Net income (loss)	32.9	25.1	29.5	11.0	13.8	13.5	9.3	9.9
Earnings (loss) per share
Basic	0.27	0.21	0.25	0.09	0.12	0.11	0.08	0.08
Diluted	0.26	0.20	0.24	0.09	0.11	0.11	0.08	0.08
Adjusted net income	37.2	35.1	34.7	23.0	18.3	27.8	21.7	21.9
Adjusted Earnings per share
Basic	0.30	0.29	0.29	0.19	0.15	0.23	0.18	0.18
Diluted	0.29	0.28	0.28	0.19	0.15	0.23	0.18	0.18

The Company's operations historically have not experienced pronounced seasonality. The Company's revenues, gross profit, EBITDA, adjusted EBITDA, net income and adjusted net income period over period are affected by the stages of work on its programs and timing of backlog execution.

CONTROLS AND PROCEDURES

The Company's CEO and CFO are responsible for establishing and maintaining Disclosure Controls and Procedures (DC&P) and have caused them to be designed under their supervision to provide reasonable assurance that information

MDA Space Ltd. — Management's Discussion and Analysis

For the First Quarters Ended March 31, 2025 and 2024

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required to be disclosed by the Company in annual filings, interim filings or other reports filed or submitted under applicable securities legislation is recorded, processed, summarized and reported within the time periods specified in such securities legislation. DC&P are designed to ensure that information required to be disclosed is accumulated and communicated to the CEO and CFO to allow timely decisions regarding required disclosure.

At March 31, 2025, the CEO and CFO, based on investigation and advice of those under their supervision, have concluded that the design and operation of the Company's DC&P were effective and that material information relating to the Company, was made known to them and was recorded, processed, summarized, and reported within the time periods specified under applicable securities legislation.

The Company's CEO and CFO are also responsible for establishing and maintaining Internal Control over Financial Reporting (ICFR) and have caused ICFR to be designed under their supervision to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS. Our ICFR includes policies and procedures that pertain to the maintenance of records that provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with IFRS. In completing the design, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in its 2013 version of Internal Control – Integrated Framework.

At March 31, 2025, the CEO and CFO, based on investigation and advice of those under their supervision, have concluded that the design and operation of the Company's ICFR were effective. The CEO and CFO have also evaluated, or caused to be evaluated by those under their supervision, and concluded that there were no changes to the Company's ICFR during the year-ended March 31, 2025 that have materially affected, or reasonably likely to materially affect the Company's ICFR.

Due to the inherent limitations of DC&P and ICFR, no evaluations of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Accordingly, management does not expect that DC&P and ICFR can prevent or detect all errors or fraud.

RISK FACTORS

We believe our performance and future success depend on a number of factors that present significant opportunities for us. These factors are also subject to a number of inherent risks and special considerations. For additional information with respect to certain of these risks or factors, reference should be made to those described and listed under the heading "Risk Factors", in the Company's AIF available on SEDAR+ at www.sedarplus.ca, which are incorporated by reference into this MD&A.

OUTSTANDING SHARE INFORMATION

The Company's common shares are traded on the Toronto Stock Exchange under the symbol "MDA". The Company is authorized to issue an unlimited number of common shares. At May 6, 2025, the Company had 122,697,950 common shares outstanding. At March 31, 2025, the details of the outstanding number of units of each type of instruments are as follows:

	March 31, 2025
Common shares outstanding	122,672,750
Outstanding instruments convertible into common shares:
Trustee shares	19,529
Stock options	6,821,173
Restricted share units	734,600
Performance share units	526,748
Deferred share units	266,146

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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ADDITIONAL INFORMATION

Additional information about the Company is available on SEDAR+ at www.sedarplus.ca.

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024

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GLOSSARY OF TERMS

This glossary defines certain business, industry, technical and legal terms used in this MD&A for the convenience of the reader. It is not a comprehensive list of all defined terms used in this MD&A.

All references to the "Company", "MDA Space", "MDA", "we", "us" or "our" refer to MDA Space Ltd. together with its subsidiaries or its predecessors, as the context requires.

"Acquisition" means the April 8, 2020 acquisition as described in note 1 of the 2024 Audited Financial Statements

"Backlog" means the dollar sum of revenue that is expected to be recognized from firm customer contracts and carries the same meaning as remaining performance obligations that is disclosed in note 7 of our 2024 Audited Financial Statements

"EO" means Earth observation

"Free Cash Flow" means operating cash flows less net capital expenditures

"GEO" means geosynchronous orbit

"Globalstar" means Globalstar Inc.

"ICFR" means Internal Control over Financial Reporting

"IFRS" means IFRS Accounting Standards as issued by the International Accounting Standards Board

"IoT" means Internet of Things

"ISAM" means in-space servicing, assembly and manufacturing

"ISS" means International Space Station

"LEO" means low Earth orbit

"LiDAR" means light detection and ranging

"MD&A" means Management's Discussion and Analysis

"MDA Space" means MDA Space Ltd., its subsidiaries or its predecessors, as the context requires

"MDA CHORUS™" means the Company's initiative to build our next generation commercial EO satellite mission providing SAR-based imagery, analytics, and information services

"MEO" means medium Earth orbit

"Net Debt" means the sum of the total carrying amount of long-term debt including current portions, as presented on the consolidated statement of financial position, less cash and excluding any lease liabilities

"Omnibus Plan" means the MDA Space omnibus equity incentive plan, pursuant to which MDA Space may grant long-term incentives consisting of stock options, performance share units and/or restricted share units to its executive officers and employees

"Operating Income" means the gross profit less operating expenses

"Order Bookings" means the dollar sum of contract values of firm customer contracts

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024
M-23

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"R&D" means research and development

"RPAS" means Remotely Piloted Aircraft Systems

"SAR" means Synthetic Aperture Radar

"TTM" means trailing twelve months

MDA Space Ltd. — Management's Discussion and Analysis
For the First Quarters Ended March 31, 2025 and 2024
M-24