The adjustment comes as the firm evaluates potential impacts from proposed cuts to the Department of Defense's commercial imagery budget for fiscal year 2026, which could see a 30% reduction from the expected $400-450 million allocation. Despite these concerns, BlackSky maintains impressive gross profit margins of 69.27% and operates with a moderate debt level, according to InvestingPro data. Despite these proposed cuts, Canaccord Genuity analyst Austin Moeller expressed confidence that Congress would likely reverse the DoD budget reductions, citing similar reversals in NASA's budget where proposed $6 billion cuts were largely restored to $24.8-24.9 billion. The firm noted that BlackSky's current $366 million backlog as of Q1 2025 consists almost entirely of contracts with international governments, potentially insulating the company from immediate U.S. budget fluctuations.