AST SpaceMobile Provides Business Update and Fourth Quarter and Full Year 2023 Results
“It has been a busy and exciting start to 2024 for
Business Update
-
Key Investments and Commercial Agreements With AT&T,
Google , Vodafone and the United States Government- Milestone strategic financing is a vote of confidence in AST’s tech and business model
- Fixed-firm-price contract award announced with the United States Government through a prime contractor, expected to produce initial revenue in Q1 2024
- Necessary funding on-hand to execute near-term strategic plan for the launch of five 700 sq. ft. Block 1 BlueBird satellites and first next generation 2,400 sq. ft. Block 2 BlueBird satellite, which will surpass Block 1 BlueBird satellites as the largest commercial phased array in low Earth orbit
- Continue to advance discussions with additional strategic partners, following the blueprint of strategic investments alongside commercial payments
-
FCC Approves Framework for the Use of Terrestrial Spectrum for SpaceMobile (Direct-to-Device)- Potential to unlock 200+ MHz of terrestrial low band spectrum for satellite direct-to-device use
-
FCC voted 5-0 onMarch 14 to approve the Supplemental Coverage from Space NPRM draft rules published in February -
Should facilitate AST’s
FCC application to provide commercial services in the US - We anticipate many regulatory entities globally will follow the new US regulatory regime
- Simplifies overall application process by making standard rules which cover the majority of AST’s application
-
Production, Assembly and Testing Capabilities Now Fully Operational at Texas Facilities
- Continue to ramp production capability of microns, the building blocks of our Block 1 and Block 2 satellites
- Production of five 700 sq. ft. Block 1 BlueBird satellites was impacted by two suppliers, leading to delays in integration and testing; In order to accelerate production of our next satellites and reduce dependency on these suppliers, we acquired a non-exclusive and worldwide license to manufacture one of the subsystems, and replaced the supplier of the other subsystem with a new supplier with whom we have completed a new design and now own the IP
- We will now be able to manufacture in-house or through third-parties using our own IP approximately 95% of all satellite subsystems for our next generation Block 2 BlueBird satellites
-
Orbital Launch Updates Provide Near-Term Timeline
- Five 700 sq. ft. Block 1 BlueBird Satellites expected to be transported from our assembly facilities to the launch site between July and August of 2024
-
Secured launch contract for first 2,400 sq. ft next generation Block 2 BlueBird satellite, with a contractual launch window from
December 2024 toMarch 2025
-
Custom ASIC Enters Tape-Out Phase With TSMC, Planned to Enable Up To 120 Mbps Peak Data Rates on 40 MHz Spectrum Channels and Processing Bandwidth of Up To 10,000 MHz Per Satellite
- Novel, custom and low-power architecture developed to enable up to a tenfold improvement in processing bandwidth on each next generation 2,400 sq. ft. Block 2 BlueBird satellite
-
Represents a competitive advantage developed over four years, equivalent to an estimated 150 man-years, with approximately
$45.0 million of development
-
Progressing Non-Dilutive Quasi-Governmental Funding Sources With Non-Binding Letters of Interest from Three Institutions
- Framework for accessing significant long-term, lower-cost non-dilutive capital
Fourth Quarter and Full Year 2023 Financial Highlights
-
As of
December 31, 2023 , we had cash, cash equivalents and restricted cash on hand of$88.1 million . We ended the first quarter of 2024 with cash and cash equivalents and restricted cash of approximately$210.8 million . We have additional liquidity of$51.5 million in gross proceeds available to draw under the Senior Secured Credit Facility, subject to certain conditions and approvals -
Total operating expenses for the fourth quarter of 2023 were
$60.9 million , including$22.3 million of depreciation and amortization and stock-based compensation expense. This represents an increase of$1.9 million as compared to$59.0 million in the third quarter of 2023, due to a$0.6 million increase in depreciation and amortization expense, a$0.5 million increase in engineering services costs, and a$1.4 million increase in research and development costs offset by a$0.5 million decrease in general and administrative costs -
Total operating expenses increased by
$69.5 million to$222.4 million for the year endedDecember 31, 2023 , as compared to$152.9 million for the year endedDecember 31, 2022 -
Total Adjusted operating expenses for the fourth quarter of 2023 were
$38.6 million , an increase of$1.3 million as compared to$37.3 million in the third quarter of 2023, due to a$1.4 million increase in research and development costs and a$0.5 million increase in Adjusted engineering services costs offset by a$0.6 million decrease in Adjusted general and administrative costs(1) -
As of
December 31, 2023 , we have incurred approximately$299.7 million of gross capitalized property and equipment costs and accumulated depreciation and amortization of$61.2 million . The capitalized costs include costs of our BlueWalker 3 satellite, assembly and integration facilities including assembly and test equipment, satellite materials, advance launch payments and ground antennas
(1) |
|
See reconciliation of Adjusted operating expenses to Total operating expenses, Adjusted engineering services costs to Engineering services costs and Adjusted general and administrative costs to General and administrative costs in the tables accompanying this press release. |
Non-GAAP Financial Measures
We refer to certain non-GAAP financial measures in this press release, including Adjusted operating expenses, Adjusted engineering services costs and Adjusted general and administrative costs. We believe these non-GAAP financial measures are useful measures across time in evaluating our operating performance as we use these measures to manage the business, including in preparing our annual operating budget and financial projections. These non-GAAP financial measures that have no standardized meaning prescribed by
Conference Call Information
About
Forward-Looking Statements
This communication contains “forward-looking statements” that are not historical facts, and involve risks and uncertainties that could cause actual results of
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside AST SpaceMobile’s control and are difficult to predict.
Factors that may cause such differences include, but are not limited to: (i) expectations regarding AST SpaceMobile’s strategies and future financial performance, including AST’s future business plans or objectives, expected functionality of the SpaceMobile Service, anticipated timing of the launch of the Block 1 Bluebird satellites, anticipated demand and acceptance of mobile satellite services, prospective performance and commercial opportunities and competitors, the timing of obtaining regulatory approvals, ability to finance its research and development activities, commercial partnership acquisition and retention, products and services, pricing, marketing plans, operating expenses, market trends, revenues, liquidity, cash flows and uses of cash, capital expenditures, and AST’s ability to invest in growth initiatives; (ii) the negotiation of definitive agreements with mobile network operators relating to the SpaceMobile service that would supersede preliminary agreements and memoranda of understanding and the ability to enter into commercial agreements with other parties or government entities; (iii) the ability of
Fourth Quarter and Fiscal Year 2023 Financial Results
CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except share data) |
||||||||
|
|
|
|
|||||
|
|
2023 |
|
|
2022 |
|
||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
85,622 |
|
|
$ |
238,588 |
|
Restricted cash |
|
|
2,475 |
|
|
|
668 |
|
Prepaid expenses |
|
|
4,591 |
|
|
|
4,100 |
|
Other current assets |
|
|
14,194 |
|
|
|
24,954 |
|
Total current assets |
|
|
106,882 |
|
|
|
268,310 |
|
|
|
|
|
|
|
|
||
Non-current assets: |
|
|
|
|
|
|
||
Property and equipment, net |
|
|
238,478 |
|
|
|
145,989 |
|
Operating lease right-of-use assets, net |
|
|
13,221 |
|
|
|
7,671 |
|
Other non-current assets |
|
|
2,311 |
|
|
|
16,402 |
|
TOTAL ASSETS |
|
$ |
360,892 |
|
|
$ |
438,372 |
|
|
|
|
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
|
20,575 |
|
|
|
13,929 |
|
Accrued expenses and other current liabilities |
|
|
23,926 |
|
|
|
12,903 |
|
Current operating lease liabilities |
|
|
1,468 |
|
|
|
722 |
|
Current portion of long-term debt, net |
|
|
252 |
|
|
|
242 |
|
Total current liabilities |
|
|
46,221 |
|
|
|
27,796 |
|
|
|
|
|
|
|
|
||
Non-current liabilities: |
|
|
|
|
|
|
||
Warrant liabilities |
|
|
29,960 |
|
|
|
38,946 |
|
Non-current operating lease liabilities |
|
|
11,900 |
|
|
|
7,046 |
|
Long-term debt, net |
|
|
59,252 |
|
|
|
4,758 |
|
Total liabilities |
|
|
147,333 |
|
|
|
78,546 |
|
|
|
|
|
|
|
|
||
Commitments and contingencies |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Stockholders' Equity: |
|
|
|
|
|
|
||
Class A Common Stock, |
|
|
9 |
|
|
|
7 |
|
Class B Common Stock, |
|
|
5 |
|
|
|
5 |
|
Class |
|
|
8 |
|
|
|
8 |
|
Additional paid-in capital |
|
|
288,404 |
|
|
|
235,384 |
|
Accumulated other comprehensive income |
|
|
227 |
|
|
|
229 |
|
Accumulated deficit |
|
|
(189,662 |
) |
|
|
(102,101 |
) |
Noncontrolling interest |
|
|
114,568 |
|
|
|
226,294 |
|
Total stockholders' equity |
|
|
213,559 |
|
|
|
359,826 |
|
|
|
|
|
|
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
360,892 |
|
|
$ |
438,372 |
|
CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except share and per share data) |
||||||||
|
|
Year Ended |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
|
||
Revenues |
|
$ |
- |
|
|
$ |
13,825 |
|
|
|
|
|
|
|
|
||
Cost of sales (exclusive of items shown separately below) |
|
|
- |
|
|
|
6,714 |
|
|
|
|
|
|
|
|
||
Gross profit |
|
|
- |
|
|
|
7,111 |
|
|
|
|
|
|
|
|
||
Operating expenses: |
|
|
|
|
|
|
||
Engineering services costs |
|
|
78,811 |
|
|
|
54,212 |
|
General and administrative costs |
|
|
41,601 |
|
|
|
48,332 |
|
Research and development costs |
|
|
47,486 |
|
|
|
45,620 |
|
Depreciation and amortization |
|
|
54,469 |
|
|
|
4,711 |
|
Total operating expenses |
|
|
222,367 |
|
|
|
152,875 |
|
|
|
|
|
|
|
|
||
Other income (expense): |
|
|
|
|
|
|
||
Gain on remeasurement of warrant liabilities |
|
|
8,986 |
|
|
|
19,114 |
|
Interest income (expense), net |
|
|
2,675 |
|
|
|
2,633 |
|
Other (expense) income, net |
|
|
(10,290 |
) |
|
|
21,521 |
|
Total other income (expense), net |
|
|
1,371 |
|
|
|
43,268 |
|
|
|
|
|
|
|
|
||
Loss before income tax expense |
|
|
(220,996 |
) |
|
|
(102,496 |
) |
Income tax expense |
|
|
(1,681 |
) |
|
|
(617 |
) |
Net loss before allocation to noncontrolling interest |
|
|
(222,677 |
) |
|
|
(103,113 |
) |
|
|
|
|
|
|
|
||
Net loss attributable to noncontrolling interest |
|
|
(135,116 |
) |
|
|
(71,473 |
) |
Net loss attributable to common stockholders |
|
$ |
(87,561 |
) |
|
$ |
(31,640 |
) |
Net loss per share attributable to holders of Class A Common Stock |
|
|
|
|
|
|
||
Basic and diluted |
|
$ |
(1.07 |
) |
|
$ |
(0.58 |
) |
Weighted-average shares of Class A Common Stock outstanding |
|
|
|
|
|
|
||
Basic and diluted |
|
|
81,824,122 |
|
|
|
54,437,073 |
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Dollars in thousands) |
||||||||
|
|
Year Ended |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
|
||
Net loss before allocation to noncontrolling interest |
|
$ |
(222,677 |
) |
|
$ |
(103,113 |
) |
Other comprehensive loss |
|
|
|
|
|
|
||
Foreign currency translation adjustments |
|
|
(6 |
) |
|
|
(295 |
) |
Total other comprehensive loss |
|
|
(6 |
) |
|
|
(295 |
) |
Total comprehensive loss before allocation to noncontrolling interest |
|
|
(222,683 |
) |
|
|
(103,408 |
) |
Comprehensive loss attributable to noncontrolling interest |
|
|
(135,120 |
) |
|
|
(71,704 |
) |
Comprehensive loss attributable to common stockholders |
|
$ |
(87,563 |
) |
|
$ |
(31,704 |
) |
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (Dollars in thousands, except share and per share data) |
||||||||
|
|
For the Three Months Ended |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
|
||
Revenues |
|
$ |
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
||
Cost of sales (exclusive of items shown separately below) |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
||
Gross profit |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
||
Operating expenses: |
|
|
|
|
|
|
||
Engineering services costs |
|
|
19,992 |
|
|
|
16,004 |
|
General and administrative costs |
|
|
10,528 |
|
|
|
10,698 |
|
Research and development costs |
|
|
10,766 |
|
|
|
14,651 |
|
Depreciation and amortization |
|
|
19,592 |
|
|
|
1,254 |
|
Total operating expenses |
|
|
60,878 |
|
|
|
42,607 |
|
|
|
|
|
|
|
|
||
Other (expense) income: |
|
|
|
|
|
|
||
Gain on remeasurement of warrant liabilities |
|
|
(12,468 |
) |
|
|
17,445 |
|
Interest (expense) income, net |
|
|
(1,635 |
) |
|
|
1,612 |
|
Other expense, net |
|
|
(55 |
) |
|
|
(1,669 |
) |
Total other (expense) income, net |
|
|
(14,158 |
) |
|
|
17,388 |
|
|
|
|
|
|
|
|
||
Loss before income tax (expense) benefit |
|
|
(75,036 |
) |
|
|
(25,219 |
) |
Income tax (expense) benefit |
|
|
(2,088 |
) |
|
|
130 |
|
Net loss before allocation to noncontrolling interest |
|
|
(77,124 |
) |
|
|
(25,089 |
) |
|
|
|
|
|
|
|
||
Net loss attributable to noncontrolling interest |
|
|
(45,198 |
) |
|
|
(16,860 |
) |
Net loss attributable to common stockholders |
|
$ |
(31,926 |
) |
|
$ |
(8,229 |
) |
Net loss per share of common stock attributable to common stockholders |
|
|
|
|
|
|
||
Basic and diluted |
|
$ |
(0.35 |
) |
|
$ |
(0.14 |
) |
Weighted average shares used in computing net loss per share of common stock |
|
|
|
|
|
|
||
Basic and diluted |
|
|
90,008,459 |
|
|
|
60,799,275 |
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (Dollars in thousands) |
||||||||
|
|
For the Three Months Ended |
|
|||||
|
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
|
||
Net income loss before allocation to noncontrolling interest |
|
$ |
(77,124 |
) |
|
$ |
(25,089 |
) |
Other comprehensive loss |
|
|
|
|
|
|
||
Foreign currency translation adjustments |
|
|
520 |
|
|
|
1,570 |
|
Total other comprehensive loss |
|
|
520 |
|
|
|
1,570 |
|
Total comprehensive loss before allocation to noncontrolling interest |
|
|
(76,604 |
) |
|
|
(23,519 |
) |
Comprehensive loss attributable to noncontrolling interest |
|
|
(44,894 |
) |
|
|
(15,789 |
) |
Comprehensive loss attributable to common stockholders |
|
$ |
(31,710 |
) |
|
$ |
(7,730 |
) |
CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) |
|||||||
|
Years Ended |
|
|||||
|
2023 |
|
|
2022 |
|
||
|
|
|
|
|
|
||
Cash flows from operating activities: |
|
|
|
|
|
||
Net loss before allocation to noncontrolling interest |
$ |
(222,677 |
) |
|
$ |
(103,113 |
) |
Adjustments to reconcile net loss before noncontrolling interest to cash
|
|
|
|
|
|
||
Gain on sale of Nano |
|
- |
|
|
|
(24,542 |
) |
Depreciation and amortization |
|
54,469 |
|
|
|
4,711 |
|
Gain on remeasurement of warrant liabilities |
|
(8,986 |
) |
|
|
(19,114 |
) |
Loss on sale of Property and equipment |
|
110 |
|
|
|
305 |
|
Amortization of debt issuance costs |
|
1,155 |
|
|
|
- |
|
Stock-based compensation |
|
13,289 |
|
|
|
9,391 |
|
Issuance of common stock for commitment shares |
|
- |
|
|
|
332 |
|
Changes in operating assets and liabilities: |
|
- |
|
|
|
|
|
Accounts receivable |
|
- |
|
|
|
(1,993 |
) |
Inventory |
|
- |
|
|
|
(2,461 |
) |
Prepaid expenses and other current assets |
|
12,082 |
|
|
|
(24,588 |
) |
Accounts payable and accrued expenses |
|
(149 |
) |
|
|
18,438 |
|
Operating lease right-of-use assets and operating lease liabilities |
|
48 |
|
|
|
40 |
|
Deferred revenue |
|
- |
|
|
|
2,395 |
|
Other assets and liabilities |
|
1,717 |
|
|
|
(16,265 |
) |
Net cash used in operating activities |
|
(148,942 |
) |
|
|
(156,464 |
) |
|
|
|
|
|
|
||
Cash flows from investing activities: |
|
|
|
|
|
||
Purchase of property and equipment and advance launch payments |
|
(118,807 |
) |
|
|
(57,284 |
) |
Proceeds from sale of Nano, net of cash deconsolidated and transaction costs |
|
- |
|
|
|
25,932 |
|
Net cash used in investing activities |
|
(118,807 |
) |
|
|
(31,352 |
) |
|
|
|
|
|
|
||
Cash flows from financing activities: |
|
|
|
|
|
||
Proceeds from debt |
|
63,500 |
|
|
|
230 |
|
Repayments of debt |
|
(242 |
) |
|
|
- |
|
Payment for debt issuance costs |
|
(9,653 |
) |
|
|
- |
|
Proceeds from issuance of common stock, net of issuance costs |
|
63,767 |
|
|
|
102,023 |
|
Issuance of equity under employee stock plan |
|
225 |
|
|
|
73 |
|
Employee taxes paid for stock-based compensation awards |
|
(865 |
) |
|
|
- |
|
Proceeds from warrant exercises |
|
- |
|
|
|
14 |
|
Net cash provided by financing activities |
|
116,732 |
|
|
|
102,340 |
|
|
|
|
|
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
(142 |
) |
|
|
195 |
|
|
|
|
|
|
|
||
Net (decrease) increase in cash, cash equivalents and restricted cash |
|
(151,159 |
) |
|
|
(85,281 |
) |
Cash, cash equivalents and restricted cash, beginning of period |
|
239,256 |
|
|
|
324,537 |
|
Cash, cash equivalents and restricted cash, end of period |
$ |
88,097 |
|
|
$ |
239,256 |
|
|
|
|
|
|
|
||
Supplemental disclosure of cash flow information: |
|
|
|
|
|
||
Non-cash transactions: |
|
|
|
|
|
||
Purchases of property and equipment in accounts payable and accrued expenses |
$ |
18,409 |
|
|
$ |
4,926 |
|
Right-of-use assets obtained in exchange for operating lease liabilities |
|
6,739 |
|
|
|
1,129 |
|
Cash paid during the fiscal year for: |
|
|
|
|
|
||
Interest |
$ |
3,243 |
|
|
$ |
224 |
|
Income taxes, net |
|
492 |
|
|
|
684 |
|
RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED MEASURES (UNAUDITED) (Dollars in thousands) |
||||||||||||
|
|
For the Three Months Ended |
|
|||||||||
|
|
GAAP Reported |
|
|
Stock-Based
|
|
|
Adjusted |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Engineering services costs |
|
$ |
19,992 |
|
|
$ |
(1,475 |
) |
|
$ |
18,517 |
|
General and administrative costs |
|
|
10,528 |
|
|
$ |
(1,219 |
) |
|
|
9,309 |
|
Research and development costs |
|
|
10,766 |
|
|
|
|
|
|
10,766 |
|
|
Depreciation and amortization |
|
|
19,592 |
|
|
|
|
|
|
19,592 |
|
|
Total operating expenses |
|
$ |
60,878 |
|
|
$ |
(2,694 |
) |
|
$ |
58,184 |
|
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
(19,592 |
) |
||
Adjusted operating expenses |
|
|
|
|
|
|
|
$ |
38,592 |
|
|
|
For the Three Months Ended |
|
|||||||||
|
|
GAAP Reported |
|
|
Stock-Based
|
|
|
Adjusted |
|
|||
Engineering services costs |
|
$ |
19,523 |
|
|
$ |
(1,507 |
) |
|
$ |
18,016 |
|
General and administrative costs |
|
|
10,995 |
|
|
|
(1,082 |
) |
|
|
9,913 |
|
Research and development costs |
|
|
9,418 |
|
|
|
- |
|
|
|
9,418 |
|
Depreciation and amortization |
|
|
19,029 |
|
|
|
- |
|
|
|
19,029 |
|
Total operating expenses |
|
$ |
58,965 |
|
|
$ |
(2,589 |
) |
|
$ |
56,376 |
|
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
(19,029 |
) |
||
Adjusted operating expenses |
|
|
|
|
|
|
|
$ |
37,347 |
|
||
Adjusted operating expenses, Adjusted engineering services costs and Adjusted general and administrative costs are alternative financial measures used by management to evaluate our operating performance as a supplement to our most directly comparable
We believe Adjusted operating expenses, Adjusted engineering services costs and Adjusted general and administrative costs are useful measures across time in evaluating our operating performance as we use these measures to manage the business, including in preparing our annual operating budget and financial projections. Adjusted operating expenses, Adjusted engineering services costs, and Adjusted general and administrative costs are non-GAAP financial measures that have no standardized meaning prescribed by
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917-547-7289
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