ASTS
Ast Spacemobile, INC
NASDAQ
10-K: AST SpaceMobile Navigates Financial Landscape: Reports Progress on Satellite Development Amidst Ongoing Losses
Sentiment:
Annual Results
1 April 2024 4:16 PM
AST SpaceMobile's 10-K filing reveals continued investment in its SpaceMobile service and satellite technology, alongside significant operating losses and reliance on future capital raises.
Worse than expected
The company reported a net loss attributable to common stockholders of $87.6 million for the year ended December 31, 2023, which is worse than the $31.6 million loss reported for the year ended December 31, 2022.
The company has not generated any revenues from its SpaceMobile Service to date.
Delay expected
The completion of five Block 1 BB satellites has been delayed as compared to the target completion timeline due to a delay in the commencement of integration and testing of five Block 1 BB satellites.
The failure by suppliers of two key subsystems to meet their contractual delivery timelines contributed to this delay.
Capital raise
The company anticipates needing to raise an additional $350 million to $400 million to fund operations and capital expenditures for 20 Block 2 BB satellites and operate a constellation of 25 BB satellites.
The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities, secured loan facilities, or through obtaining credit from government or financial institutions or commercial partners, including through our existing Equity Line of Credit and the ATM Equity Program.
Summary
- AST SpaceMobile is developing a space-based cellular broadband network designed to work directly with standard smartphones.
- The company is currently assembling and testing its first generation of commercial BB satellites (Block 1 BB satellites), with transport to the launch site estimated between July and August 2024.
- The company is also planning and procuring activities for its second generation of commercial BB satellites (Block 2 BB satellites).
- AST SpaceMobile incurred a net loss attributable to common stockholders of $87.6 million for the year ended December 31, 2023.
- The company anticipates needing to raise an additional $350 million to $400 million to fund operations and capital expenditures for 20 Block 2 BB satellites and operate a constellation of 25 BB satellites.
- AST SpaceMobile is working to develop strategic relationships with multiple launch vehicle providers to secure launch contracts.
- The company is subject to extensive government regulations and requires regulatory approvals to access spectrum for its SpaceMobile service.
- As of December 31, 2023, the company had approximately 489 employees and consultants worldwide.
- The company has relationships with Vodafone, Rakuten, AT&T, and Google to support its SpaceMobile service.
- The company is working to control the manufacturing and supply chain of its BB satellites, aiming for greater control and lower costs.
Sentiment
Score: 5
Explanation: The document presents a mixed sentiment. While there are positive developments in satellite development and strategic partnerships, the significant operating losses, reliance on future capital raises, and potential risks temper the overall outlook.
Positives
- Successful completion of two-way voice calls and 4G download speeds achieved using the BW3 test satellite.
- Advanced stages of assembling and testing the first generation of commercial BB satellites (Block 1 BB satellites).
- Planning and procurement activities commenced for the second generation of commercial BB satellites (Block 2 BB satellites).
- Entered into a Convertible Security Investment Agreement with AT&T, Google, and Vodafone for $110 million.
- Completed a public offering of Class A Common Stock in January 2024, raising net proceeds of $107.7 million.
- The company owns the IP and controls the manufacturing process for approximately 95% of the sub-systems planned to be used in its Block 2 BB satellites.
- The company has established liaison programs with the Federal Bureau of Investigation (FBI) and U.S. Cybersecurity & Infrastructure Security Agency (CISA) to monitor, identify, and counter advanced persistent threats specific to our company and industry.
Negatives
- AST SpaceMobile incurred a net loss attributable to common stockholders of $87.6 million for the year ended December 31, 2023.
- The completion of five Block 1 BB satellites has been delayed as compared to the target completion timeline due to a delay in the commencement of integration and testing of five Block 1 BB satellites.
- The company is dependent on raising additional capital of approximately $350 million to $400 million to fund operations and capital expenditures.
- The company has a limited operating history and operates in a rapidly evolving industry, which makes it difficult to evaluate the business and future prospects.
- The company relies on MNOs and requires regulatory approvals to access the spectrum the SpaceMobile Service needs to operate.
Risks
- The SpaceMobile Service is in development and may not be completed on time or at all, and the costs associated with it may be greater than expected.
- The company will need to raise additional funds for continued operations and to initiate its planned SpaceMobile Service, and these funds may not be available on favorable terms or at all.
- The company will incur significant expenses and capital expenditures in the future to execute its business plan and develop the SpaceMobile Service, and it may be unable to adequately forecast or control its expenses.
- The company is an early-stage company with a history of losses and may never become profitable.
- The company will rely on MNOs and require regulatory approvals to access the spectrum the SpaceMobile Service needs to operate.
- Rapid and significant technological changes could render the SpaceMobile Service obsolete and impair the company's ability to compete.
- The company could fail to achieve revenue, or experience a decline in revenue, as a result of increasing competition from companies in the wireless communications industry.
- The company is dependent on third parties to market and sell its products and services.
- The company relies on third parties for the supply of equipment, satellite components, and services.
- The company's satellites may collide with space debris or another spacecraft, which could adversely affect the performance of its SpaceMobile Service.
- Cyberattacks impacting the company's networks or systems may have a material effect on its operations.
Future Outlook
The company plans to initiate a limited, noncontinuous SpaceMobile Service in targeted geographical areas following the launch and deployment of five Block 1 BB satellites and seek to generate revenue from such service. The company expects to begin generating revenue from the resale of gateway equipment and associated services to MNOs and other third parties, and from completing defined milestones under an agreement with a prime contractor for a U.S. government contract in 2024.
Management Comments
- The company is leveraging skills, know-how and technological expertise derived from the design and assembly of our BW3 test satellite in the development and assembly of our BB satellite platform.
- The company believes the introduction of ASIC chip in our Block 2 BB satellites will enable materially greater throughput capacity of up to 40 MHz per beam to support 120 Mbps peak data rates and up to 10,000 MHz of processing bandwidth per Block 2 BB satellite, require less power and offer a lower overall unit cost.
- The company plans to achieve substantial service in the selected, targeted geographical areas with the launch and operation of 25 BB satellites and achieve substantial service in all targeted geographical areas to meet our long term business goals with the launch and operation of approximately 95 BB satellites.
Industry Context
The document highlights AST SpaceMobile's position in the competitive mobile satellite services industry, emphasizing its unique approach of providing cellular broadband directly to unmodified devices using existing MNO spectrum. It acknowledges competition from established players like Inmarsat and Iridium, as well as emerging LEO networks like Starlink and OneWeb.
Comparison to Industry Standards
- AST SpaceMobile's approach differs from traditional mobile satellite service providers like Inmarsat, Globalstar, and Iridium, which require specialized equipment or satellite phones.
- Unlike LEO networks such as SpaceX's Starlink and Amazon's Kuiper, which primarily focus on fixed broadband or low data rate applications, AST SpaceMobile aims to provide cellular broadband data rates to existing unmodified handsets.
- The company's large phased array technology is designed to operate in low to mid-band spectrums used by MNOs, offering a competitive advantage over other direct-to-device satellite services.
- AST SpaceMobile's strategy of partnering with MNOs to augment their coverage areas differs from competitors who directly compete with terrestrial networks.
Stakeholder Impact
- Shareholders face potential dilution from future equity offerings.
- Employees are subject to ongoing training and development programs.
- MNOs have the opportunity to expand their coverage areas and increase their total addressable market with limited incremental capital investment.
- Customers may benefit from increased cellular broadband coverage in hard-to-reach areas.
Next Steps
- Transport the five Block 1 BB satellites from assembly facilities to the launch site between July and August 2024.
- Continue the design and development of Block 2 BB satellites.
- Continue to seek regulatory approvals in each jurisdiction where the company would provide such service.
- Continue to enter into definitive agreements with MNOs relating to the offering of such service in each jurisdiction.
Legal Proceedings
- The company is subject to various legal proceedings and claims that have arisen in the ordinary course of business and that have not been fully adjudicated.
- Two stockholders have filed putative class action complaints in the Delaware Court of Chancery against the Company, certain current and former directors of the Company and its predecessor entity and manager, New Providence Acquisition Corp. and New Providence Management LLC, and Abel Avellan, alleging claims of breach of fiduciary duties and aiding and abetting such breaches, relating to the de-SPAC merger.
Related Party Transactions
- The company has agreements and relationships with Vodafone, Rakuten, AT&T, and Google, where board members or affiliates are involved.
- The company completed a series of transactions with Invesat LLC, which is part of the Cisneros Group of Companies, of which Ms. Adriana Cisneros, a member of the Company's Board of Directors, is the Chief Executive Officer.
Key Dates
- April 1, 2019: Launched first test satellite, BlueWalker 1 (BW1).
- September 13, 2019: Warrant Agreement between Continental Stock Transfer & Trust Company and the Company.
- February 4, 2020: Entered into a commercial agreement with Rakuten.
- December 15, 2020: Equity Purchase Agreement among AST & Science LLC, New Providence Acquisition Corp., and others.
- December 15, 2020: Side letter agreement between AST SpaceMobile and Vodafone.
- December 15, 2020: Side letter agreement between AST SpaceMobile and American Tower.
- April 1, 2021: Stockholders approved the 2020 Incentive Award Plan.
- April 6, 2021: Completed business combination with AST & Science LLC.
- April 6, 2021: Stockholders Agreement among the Company and the Stockholder Parties.
- February 4, 2021: Employment agreement between AST SpaceMobile, Inc. and Brian Heller.
- May 6, 2022: Entered into Common Stock Purchase Agreement with B. Riley Principal Capital, LLC.
- April 25, 2022: Employment agreement between AST SpaceMobile, Inc. and Sean Wallace.
- September 6, 2022: Completed the sale of its 51% interest in NanoAvionika UAB.
- September 8, 2022: Entered into Equity Distribution Agreement with Evercore Group L.L.C. and B. Riley Securities, Inc.
- September 10, 2022: Launched BlueWalker 3 (BW3) test satellite.
- November 14, 2022: Announced completion of the deployment of the communication phased array antenna of the BW3 test satellite in orbit.
- April 25, 2023: Announced successful completion of two-way voice calls directly to standard unmodified smartphones using the BW3 test satellite.
- June 21, 2023: Announced achievement of repeated successful 4G download speeds of above 10 Mbps to standard unmodified smartphones using the BW3 test satellite.
- September 19, 2023: Announced achievement of repeated successful two-way voice calls directly to standard unmodified smartphones using 5G connectivity and successful download speeds of approximately 14 Mbps utilizing 5 Mhz of low band spectrum via the BW3 test satellite.
- August 14, 2023: Entered into a senior secured term loan credit agreement with ACP Post Oak Credit II LLC.
- August 14, 2023: Entered into a loan agreement with Lone Star State Bank of West Texas.
- December 27, 2023: Taylor v. Coleman, et al. (C.A. No. 2023-1292) was filed.
- January 16, 2024: Entered into a Convertible Security Investment Agreement with AT&T, Google, and Vodafone.
- January 23, 2024: Issued 32,258,064 shares of Class A Common Stock in a public offering.
- January 25, 2024: The Option Shares were exercised in full.
- January 29, 2024: The offering of the Option Shares closed.
- March 4, 2024: Completed a series of transactions resulting in the acquisition by Antares of 10,445,200 shares of the Company's Class A Common Stock.
- March 14, 2024: Defendants had moved to dismiss the Taylor action.
- March 29, 2024: Drulias v. New Providence Management LLC, et al., was filed.
- July-August 2024 (estimated): Estimated transport of Block 1 BB satellites to the launch site.
- December 15, 2024 March 31, 2025 (launch window): Launch window for the first Block 2 BB satellite.
Keywords
SpaceMobile, Satellites, Cellular Broadband, AST SpaceMobile, 10-K Filing, Financial Results, Capital Raise, BB Satellites, MNOs, Regulatory Approvals
ASTS
Ast Spacemobile, INC
NASDAQ
Sector: TBD
Filings with Classifications
Capital raise
13 May 2025 8:37 AM
8-K Filing
- AST SpaceMobile has entered into an Equity Distribution Agreement to sell up to $500 million of its Class A common stock.
- The shares will be sold through an at-the-market offering program.
- The company intends to use the proceeds for general corporate purposes.
Worse than expected
12 May 2025 4:52 PM
Quarterly Report
- The net loss attributable to common stockholders increased significantly compared to the same period last year.
- Engineering services costs, general and administrative costs, and research and development costs all increased compared to the same period last year.
Capital raise
12 May 2025 4:52 PM
Quarterly Report
- The company issued $460.0 million aggregate principal amount of convertible senior notes due 2032.
- The company entered into an Equity Distribution Agreement to sell shares of Class A Common Stock having an aggregate sale price of up to $400.0 million through an at the market offering program.
- The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities (secured or unsecured), secured or unsecured loans or other debt facilities, and credit from government or financial institutions or commercial partners.
Better than expected
12 May 2025 4:35 PM
Quarterly Report
- The company is ahead of schedule with satellite manufacturing and launch plans.
- The company has secured contracts with the U.S. Space Development Agency and the Defense Innovation Unit.
- The company has secured initial clearances for quasi-governmental funding with EXIM and IFC for over $500.0 million in potential new non-dilutive capital.
Worse than expected
3 March 2025 9:31 PM
Annual Report
- The company reported a net loss of $300.1 million, significantly worse than the previous year.
Capital raise
3 March 2025 9:31 PM
Annual Report
- The company intends to seek to raise additional capital to fund the design, assembly and launch of its constellation and operation of the commercial services through the issuance of equity, equity-linked or debt securities (secured or unsecured), secured or unsecured loans or other debt facilities, and credit from government or financial institutions or commercial partners, including through its existing 2024 ATM Equity Program.
Delay expected
3 March 2025 9:31 PM
Annual Report
- The timing of shipment of the first Block 2 BB satellite is contingent on a number of factors including satisfactory and timely completion of the assembly and testing of the Block 2 BB satellite, regulatory approvals for the launch, readiness of the launch vehicle, logistics and other factors, many of which are beyond our control.
Capital raise
10 February 2025 11:37 PM
Beneficial Ownership Disclosure
- The document details a Convertible Security Investment Agreement dated January 16, 2024, where AT&T Investments purchased a subordinated convertible note from AST SpaceMobile, Inc. for a principal amount of $35.0 million. This note served as a capital raise for AST SpaceMobile.
Capital raise
27 January 2025 4:05 PM
Debt Offering Announcement
- AST SpaceMobile completed a private offering of $460 million aggregate principal amount of 4.25% Convertible Senior Notes due 2032.
- The offering included the exercise in full of the initial purchasers option to purchase up to an additional $60 million principal amount of the Notes.
Worse than expected
27 January 2025 6:02 AM
Ownership Disclosure Amendment
- The document indicates a dilution of ownership for existing shareholders due to the conversion of convertible notes, which is generally viewed negatively by the market.
Capital raise
22 January 2025 4:10 PM
Current Report
- AST SpaceMobile is proposing a private offering of $400.0 million aggregate principal amount of convertible senior notes due 2032.
- The company also intends to grant the initial purchasers of the notes in the offering an option to purchase up to an additional $60.0 million aggregate principal amount of notes.
- The company currently has approximately $66.0 million of availability remaining under its equity distribution agreement dated September 5, 2024 entered into with the agents named therein (the 2024 ATM equity program).
- The Company may seek to enter into a new equity ATM program in the future.
Capital raise
7 January 2025 8:01 AM
Strategic Collaboration Announcement
- AST SpaceMobile has secured a $550 million institutional financing commitment in the form of a non-recourse senior-secured delayed-draw term loan facility.
- The facility will be used to support payment obligations related to the AST Transaction.
Capital raise
6 January 2025 8:15 AM
Strategic Agreement Announcement
- AST SpaceMobile has received a $550 million institutional financing commitment to finance a planned wholly owned special-purpose vehicle (SPV).
- This financing is in the form of a non-recourse senior-secured delayed-draw term loan facility.
Capital raise
14 November 2024 4:25 PM
Quarterly Report
- The company established a new equity distribution agreement on September 5, 2024, allowing for the sale of up to $400 million of Class A common stock.
- The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities, secured or unsecured loans or other debt facilities, and credit from government or financial institutions or commercial partners.
Worse than expected
14 November 2024 4:25 PM
Quarterly Report
- The company's net loss attributable to common stockholders was significantly higher than the same period last year.
- The company incurred a substantial loss from the remeasurement of warrant liabilities.
Capital raise
14 November 2024 4:24 PM
Quarterly Report
- The company received $153.3 million in net proceeds from the redemption of publicly traded warrants.
- They are prioritizing raising strategic capital through non-dilutive approaches, including commercial prepayments and commitments from MNO partners.
- They have filed a formal application with the Export-Import Bank of the United States (EXIM) for debt financing.
Capital raise
5 September 2024 9:35 AM
Equity Offering Announcement
- AST SpaceMobile has entered into an Equity Distribution Agreement to sell up to $400 million of its Class A common stock through an at-the-market offering program.
- The company will sell shares through various sales agents over a period of up to three years.
- The offering is intended to provide the company with additional capital for general corporate purposes.
Delay expected
4 September 2024 6:24 PM
Business Update
- The exact timing of the orbital launch is subject to change based on various factors, including launch readiness and weather conditions.
Capital raise
14 August 2024 4:35 PM
Quarterly Report
- The company estimates needing to raise approximately $275.0 million to $325.0 million to fund operating expenses and capital expenditures necessary to design, assemble and launch 20 Block 2 BB satellites and operate a constellation of 25 BB satellites.
- The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities (secured or unsecured), secured or unsecured loans or other debt facilities, and credit from government or financial institutions or commercial partners.
Worse than expected
14 August 2024 4:35 PM
Quarterly Report
- The company's net loss of $72.6 million for the three months ended June 30, 2024, and $92.3 million for the six months ended June 30, 2024, is significantly higher than the previous year, indicating worse than expected financial performance.
- The company's loss on remeasurement of warrant liabilities of $66.1 million for the three months ended June 30, 2024, and $47.9 million for the six months ended June 30, 2024, is a significant negative impact on the company's financial results.
Capital raise
14 August 2024 4:34 PM
Quarterly Report
- Verizon has made a $100 million strategic investment, including $65 million in commercial prepayments and $35 million in convertible notes.
- The company has additional liquidity of $51.5 million available to draw under the Senior Secured Credit Facility, subject to certain conditions and approvals.
Capital raise
30 July 2024 5:00 PM
Definitive Proxy Statement
- The document mentions raising over $600.0 million of capital in the form of equity, convertible notes, and non-dilutive prepayments.
- Vodafone agreed to purchase our subordinated convertible notes for an aggregate principal amount of $25.0 million.
Capital raise
29 May 2024 7:40 AM
Capital Raise Announcement
- The company issued a $35 million subordinated convertible note to Verizon Ventures.
- This is part of a larger $100 million investment and prepayment commitment from Verizon.
Capital raise
15 May 2024 4:19 PM
Quarterly Report
- The company raised $110 million through convertible notes and $107.7 million from a common stock offering.
- The company estimates it will need to raise approximately $350.0 million to $400.0 million to fund operating expenses and capital expenditures necessary to design, assemble and launch 20 Block 2 BB satellites and operate a constellation of 25 BB satellites.
- The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities, secured or unsecured loans or other debt facilities, and credit from government or financial institutions or commercial partners, including through its existing ATM Equity Program.
Worse than expected
15 May 2024 4:19 PM
Quarterly Report
- The company's net loss increased compared to the same period last year, indicating that the company is not yet on a path to profitability.
Worse than expected
1 April 2024 4:31 PM
Annual Results and Business Update
- The company reported a net loss of $87.561 million for the year ended December 31, 2023, which is worse than the $31.640 million loss in 2022.
- Total operating expenses increased significantly from $152.9 million in 2022 to $222.4 million in 2023.
Delay expected
1 April 2024 4:31 PM
Annual Results and Business Update
- Production of five 700 sq. ft. Block 1 BlueBird satellites was impacted by two suppliers, leading to delays in integration and testing.
Capital raise
1 April 2024 4:31 PM
Annual Results and Business Update
- The company is progressing non-dilutive quasi-governmental funding sources, with non-binding letters of interest from three institutions.
- AST SpaceMobile has additional liquidity of $51.5 million in gross proceeds available to draw under the Senior Secured Credit Facility, subject to certain conditions and approvals.
Capital raise
1 April 2024 4:16 PM
Annual Results
- The company anticipates needing to raise an additional $350 million to $400 million to fund operations and capital expenditures for 20 Block 2 BB satellites and operate a constellation of 25 BB satellites.
- The company plans to raise additional capital through the issuance of equity, equity-linked or debt securities, secured loan facilities, or through obtaining credit from government or financial institutions or commercial partners, including through our existing Equity Line of Credit and the ATM Equity Program.
Worse than expected
1 April 2024 4:16 PM
Annual Results
- The company reported a net loss attributable to common stockholders of $87.6 million for the year ended December 31, 2023, which is worse than the $31.6 million loss reported for the year ended December 31, 2022.
- The company has not generated any revenues from its SpaceMobile Service to date.
Delay expected
1 April 2024 4:16 PM
Annual Results
- The completion of five Block 1 BB satellites has been delayed as compared to the target completion timeline due to a delay in the commencement of integration and testing of five Block 1 BB satellites.
- The failure by suppliers of two key subsystems to meet their contractual delivery timelines contributed to this delay.
Capital raise
29 January 2024 4:10 PM
Current Report
- The company closed an offering of 32,258,064 shares of Class A common stock.
- The underwriters exercised an option to purchase an additional 4,838,709 shares.
- The total net proceeds from the additional share offering were $14.1 million before expenses.
Capital raise
23 January 2024 4:10 PM
Capital Raise Announcement
- The company closed a share offering of 32,258,064 shares, raising $94 million before expenses.
- Underwriters have a 30-day option to purchase an additional 4,838,709 shares, potentially raising another $14.1 million before expenses.
Delay expected
18 January 2024 4:36 PM
Strategic Investment and Capital Raise Announcement
- The dedicated orbital launch for five Block 1 BB satellites, initially scheduled for late in the first quarter of 2024, is now expected to occur in the second quarter of 2024.
Worse than expected
18 January 2024 4:36 PM
Strategic Investment and Capital Raise Announcement
- The company's cash and cash equivalents decreased significantly from $239.3 million in 2022 to approximately $88.1 million in 2023.
- Total operating expenses increased from $152.9 million in 2022 to between $216.8 million and $222.5 million in 2023.
- The launch of the first five commercial BlueBird satellites has been delayed from the first quarter to the second quarter of 2024.
Capital raise
18 January 2024 4:36 PM
Strategic Investment and Capital Raise Announcement
- The company plans to raise up to $306.5 million in gross proceeds through a combination of strategic investments, a credit facility draw, and a stock offering.
- The company is launching a registered offering of $100 million in Class A common stock.
- The company plans to seek a waiver to draw up to an additional $51.5 million under its senior-secured credit facility.
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