S-1: Momentus Files S-1 for Resale of Shares Amidst Persistent Going Concern and Nasdaq Compliance Challenges

Momentus Inc. has filed an S-1 registration statement for the resale of over 8.1 million shares by existing stockholders, highlighting ongoing financial challenges including a going concern uncertainty and recent efforts to regain Nasdaq compliance.

Summary

• Momentus Inc. has filed an S-1 registration statement for the resale of up to 8,169,940 shares of its Class A common stock by identified Selling Stockholders.
• The company will not receive any proceeds from the sale of these shares by the Selling Stockholders.
• The shares registered for resale include 7,211,535 shares related to a Master Services Agreement with Velo3D, Inc., 191,339 shares issued to settle approximately $337,942.42 in outstanding debts to four vendors and one customer, and 767,066 shares issuable upon conversion of a $1.2 million convertible promissory note issued to A.G.P./Alliance Global Partners for deferred commission.
• Momentus is a U.S. commercial space company focused on satellite transportation and in-orbit services, including last-mile delivery, hosted payloads, refueling, inspection, maintenance, and debris removal, primarily using its Vigoride Orbital Service Vehicles (OSVs) which utilize water as a propellant.
• The company is developing its Tape Spring Solar Array (TASSA) technology, which aims to produce power at substantially lower cost and offers deployable/retractable features for collision protection and maneuverability.
• Momentus has faced significant financial difficulties, reporting a net loss of $34.9 million for the year ended December 31, 2024, and an accumulated deficit of $408.0 million as of that date.
• For the three months ended March 31, 2025, the company incurred a net loss of $6.2 million, increasing the accumulated deficit to $414.2 million.
• Momentus used $16.6 million in net cash for operating activities in 2024 and had cash and cash equivalents of $1.6 million as of December 31, 2024.
• Management has concluded that there is substantial doubt about the company's ability to continue as a going concern for at least 12 months from the financial statement issuance date, citing insufficient cash to fund commercial scale production and the need for substantial additional capital.
• The company has been actively working to regain and maintain compliance with Nasdaq listing requirements, including addressing deficiencies related to minimum bid price, periodic reporting, and stockholders' equity.
• A 1-for-14 reverse stock split was effected on December 13, 2024, which helped the company regain compliance with the Minimum Bid Price Requirement by January 13, 2025.
• Momentus believes it satisfied the Nasdaq Equity Rule by having approximately $8.1 million in stockholders' equity as of April 15, 2025, following the Velo3D transaction, but awaits Nasdaq's formal confirmation and remains subject to ongoing monitoring.
• The company's stock price has been highly volatile, ranging from a high of $28.56 to a low of $1.51 per share in the 12 months ended June 9, 2025, with a closing price of $1.60 on June 9, 2025.

Sentiment

Score: 2

Explanation: The company faces severe financial distress, evidenced by substantial net losses, a large accumulated deficit, significant cash burn, and an explicit 'going concern' warning from management. While there are efforts to regain Nasdaq compliance and strategic partnerships, the fundamental financial health and continuous need for dilutive capital raises present a highly negative outlook and significant risk to investors.

Positives

• Momentus has successfully conducted three test and demonstration missions with its Vigoride OSV in 2022 and 2023, demonstrating technological progress.
• The Master Services Agreement with Velo3D, Inc. provides Momentus with priority access to advanced 3D metal printing services for spacecraft components, potentially lowering production costs and accelerating development.
• The company believes it has regained compliance with the Nasdaq Minimum Bid Price Requirement and the Nasdaq Equity Rule, which is crucial for maintaining its listing, although formal confirmation is pending.
• Momentus's technology, including its water plasma propulsion and Tape Spring Solar Array (TASSA), offers potential competitive advantages such as greater payload capability, significant on-orbit power, design flexibility, and lower environmental impact.

Negatives

• The company has incurred significant net losses, totaling $34.9 million for FY2024 and $6.2 million for Q1 2025, leading to an accumulated deficit of $414.2 million as of March 31, 2025.
• Momentus's cash and cash equivalents were only $1.6 million as of December 31, 2024, and it used $16.6 million in net cash for operating activities in FY2024, indicating a high cash burn rate.
• Management has identified substantial doubt about the company's ability to continue as a going concern, necessitating significant additional capital raises.
• The company faces ongoing risk of delisting from Nasdaq if it fails to maintain compliance with listing rules, particularly the Equity Rule, or if its bid price falls again, as it is not eligible for another 180-day cure period after the recent reverse stock split.
• The issuance and potential conversion/exercise of a substantial number of convertible securities and warrants will cause significant dilution to existing shareholders.
• The market price of the Common Stock has been highly volatile, with a wide range from $28.56 to $1.51 in the past year, indicating instability and risk for investors.

Risks

• The company may not be able to continue as a going concern due to insufficient revenues and the need for substantial additional capital.
• Failure to comply with Nasdaq continued listing requirements could lead to delisting, resulting in a limited public market for shares and difficulty in obtaining future financing.
• The substantial number of outstanding convertible securities and warrants could have a significant dilutive effect on the Common Stock upon exercise or conversion.
• The company needs additional capital, which may not be available in the required amount or on favorable terms, potentially forcing a reduction or halt in operations.
• The market price of the Common Stock has been, and may continue to be, volatile, which could reduce the market price regardless of operating performance.
• The inability to utilize a registration statement on Form S-3 until April 2026 due to a late filing may limit the company's ability to raise capital efficiently.
• Doubts about the company's ability to continue as a going concern could negatively impact relationships with customers, vendors, and employees, and impair the ability to execute its strategy.

Future Outlook

Momentus plans to continue developing its Orbital Service Vehicles (OSVs), including the Block 2.2 configuration of the Vigoride OSV, MET propulsion, and the Tape Spring Solar Array (TASSA), with the goal of achieving reusability for its OSVs to lower service costs. The company intends to expand its offerings beyond transportation to include additional in-orbit services and to design and produce larger vehicles and satellite buses for more distant orbits like GEO. Momentus also aims for high-volume production of satellite buses based on Vigoride's technologies, integrating customer payloads for various missions.

Management Comments

• Management believes that the current level of cash and cash equivalents is not sufficient to fund commercial scale production and sale of its services and products.
• The company expects to finance its operations through equity or debt financings until it can generate sufficient revenues to achieve profitability.
• Momentus believes it had stockholders' equity of approximately $8.1 million as of April 15, 2025, and thereby satisfied the Nasdaq Equity Rule, though formal confirmation is awaited.

Industry Context

Momentus operates in the rapidly evolving commercial space industry, focusing on in-space infrastructure and transportation services. The company aims to address the growing demand for satellite deployment options and in-orbit services by offering cost-effective solutions, including a 'hub-and-spoke' model for last-mile satellite transportation and the use of water as a propellant to minimize environmental impact. Its offerings of satellites and satellite buses cater to the increasing needs of government and commercial customers for communications, tracking, remote sensing, and space domain awareness, leveraging prior investments in satellite technology to access a large and growing market segment.

Corporate Governance

Stakeholder Impact

• Shareholders face significant dilution from the conversion of outstanding preferred stock, convertible notes, and warrants, as well as potential future equity raises.
• Shareholders are exposed to substantial risk of further stock price decline due to the company's going concern uncertainty and volatile market performance.
• Employees may face uncertainty regarding job security and morale due to the company's financial instability and potential operational scale-backs if additional capital is not secured.
• Customers may face risks regarding the long-term viability and continuity of services from Momentus given the going concern uncertainty.
• Creditors and lenders face increased risk due to the company's financial position and the need for ongoing capital raises to sustain operations.
• Suppliers may face payment risks or altered business terms if the company's financial condition deteriorates further.

Next Steps

• Momentus must await Nasdaq's formal confirmation that it has evidenced compliance with the Equity Rule.
• Nasdaq will continue to monitor the company to ensure its ongoing compliance with the Equity Rule.
• The company needs to raise substantial additional capital to fund its business operations and execute its business plan.
• Momentus plans to continue development of Block 2.2 configuration of the Vigoride OSV, MET propulsion, and TASSA in space.
• The company aims to build new OSVs and explore commercial opportunities based on experience gained in satellite deployment and hosted payloads.
• Momentus plans to begin introducing additional services beyond transportation and eventually make its OSVs reusable.

Key Dates

Recommendation

Keywords

Space transportation, In-orbit services, Satellite, Vigoride, Water plasma propulsion, Nasdaq compliance, Going concern, SEC filing, S-1, Dilution, Space technology, Commercial space