8-K
AST SpaceMobile, Inc. (ASTS)
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| Date of Report (Date of earliest event reported): November 14, 2024 |
|---|
AST SpaceMobile, Inc.
(Exact name of Registrant as Specified in Its Charter)
| Delaware | 001-39040 | 84-2027232 |
|---|---|---|
| (State or Other Jurisdiction<br>of Incorporation) | (Commission File Number) | (IRS Employer<br>Identification No.) |
| Midland Intl. Air & Space Port<br><br>2901 Enterprise Lane | ||
| Midland, Texas | 79706 | |
| (Address of Principal Executive Offices) | (Zip Code) | |
| Registrant’s Telephone Number, Including Area Code: (432) 276-3966 | ||
| --- | ||
| Not Applicable | ||
| --- |
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br>Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Class A common stock, par value $0.0001 per share | ASTS | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On November 14, 2024, AST SpaceMobile, Inc. (“AST SpaceMobile” or the “Company”) issued a press release announcing financial results for the three and nine months ended September 30, 2024. A copy of the press release is attached hereto as Exhibit 99.1.
The information included in this Item 2.02 and in Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 7.01. Regulation FD Disclosure.
AST SpaceMobile is also furnishing a Third Quarter 2024 Business Update, dated November 14, 2024 (the “Presentation”), attached as Exhibit 99.2 to this Current Report on Form 8-K, which may be referred to on the Company’s third quarter 2024 conference call to be held on November 14, 2024. The Presentation will also be available on the Company’s website at www.ast-science.com.
The information included in this Item 7.01 and in Exhibit 99.2 shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release dated November 14, 2024 |
| 99.2 | Third Quarter 2024 Business Update |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| AST SpaceMobile, Inc. | |||
|---|---|---|---|
| Date: | November 14, 2024 | By: | /s/ Andrew M. Johnson |
| Name: Andrew M. Johnson<br>Title: Chief Financial Officer and Chief Legal Officer |
EX-99.1
| PRESS RELEASE | EXHIBIT 99.1 |
|---|
AST SpaceMobile Provides Business Update and Third Quarter 2024 Results
MIDLAND, Texas, November 14, 2024 – AST SpaceMobile, Inc. (“AST SpaceMobile”) (NASDAQ: ASTS), the company building the first and only space-based cellular broadband network accessible directly by everyday smartphones, and designed for both commercial and government applications, is providing its business update for the third quarter ended September 30, 2024.
“We achieved many significant milestones in the quarter and continue our momentum with several key pieces now in place.” said Abel Avellan, Founder, Chairman and CEO of AST SpaceMobile. “With the first five BlueBird satellites successfully unfolded and entering initial operations, our business is progressing according to plan. We’ve advanced our strategy across multiple efforts including progress on securing orbital launch capacity, growing our manufacturing capability, and expanding our customer ecosystem.”
Business Update
First five commercial BlueBird satellites achieved successful initial operations and filed Special Temporary Authority (STA) request with FCC to begin beta service with AT&T and Verizon
All five satellites successfully unfolded as of late October, completing a key post-launch activity
Preparing satellites for operational readiness through ongoing integration with partner networks
Secured orbital launch capacity to enable continuous space-based cellular broadband service coverage in key markets, including U.S., Europe, Japan, the U.S. Government and other strategic markets globally
New launch services agreements with Blue Origin and SpaceX for launches during 2025 and 2026
The agreements enable the orbital launch of up to approximately 60 Block 2 BlueBird satellites
Achieved initial validation of our AST5000 ASIC chip, with test software, test equipment, procedures, and main infrastructure in place to commission during 2025
Combination of novel ASIC and larger Block 2 array will offer beams designed to support a capacity of up to 40MHz, enabling peak data transmission speeds up to 120Mbps, supporting voice, full data and video applications
Expanded the AST SpaceMobile customer ecosystem, adding three new contract awards with the U.S. Government and continued to advance discussions with multiple commercial partners
Selection by the Space Development Agency (SDA) to compete directly as a prime contractor under the Hybrid Application for proliferated low Earth orbit (HALO) program
Added three new contract awards with U.S. Government to leverage and expand existing in-orbit technology capabilities, directly and through prime contractors
Growing pipeline of government opportunities for non-commercial applications demonstrates significant advantages of AST SpaceMobile’s dual-use technologies
Strong balance sheet with $518.9 million in cash, cash equivalents, and restricted cash, benefiting from warrant redemption and ATM program
Received $153.3 million in net proceeds from the redemption of publicly traded warrants
Repaid $48.5 million of Senior Secured Credit Facility in Q4, lowering go-forward interest expense
Filed formal application with the Export-Import Bank of the United States (EXIM) for debt financing
Continue to prioritize raising strategic capital through non-dilutive approaches, including commercial prepayments and commitments from our MNO partners
Third Quarter 2024 Financial Highlights
- As of September 30, 2024, we had cash, cash equivalents, and restricted cash of $518.9 million
- Total operating expenses for the third quarter of 2024 were $66.6 million, including $21.4 million of depreciation and amortization and stock-based compensation expense. This represents an increase of $2.7 million as compared to $63.9 million in the second quarter of 2024, due to a $10.3 million increase in research and development costs and a $0.6 million increase in engineering services costs, partially offset by a $2.3 million decrease in general and administrative costs, and a $5.9 million decrease in depreciation and amortization expense
- Adjusted operating expenses(1) for the third quarter of 2024 were $45.3 million, an increase of $10.7 million as compared to $34.6 million in the second quarter of 2024, due to a $1.2 million increase in Adjusted general and administrative costs(1), and a $10.3 million increase in research and development costs, partially offset by a $0.8 million decrease in Adjusted engineering services costs(1)
- As of September 30, 2024, we have incurred approximately $374.0 million of gross capitalized property and equipment costs and accumulated depreciation and amortization of $113.9 million. The capitalized costs include costs of satellite materials for BlueBird satellites, advance launch payments, Block 1 and BlueWalker 3 satellites, assembly and integration facilities including assembly and test equipment, 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 U.S. GAAP, and therefore have limits in their usefulness to investors. Because of the non-standardized definitions, these measures may not be comparable to the calculation of similar measures of other companies and are presented solely to provide investors with useful information to more fully understand how management assesses performance. These measures are not, and should not be viewed as, a substitute for their most directly comparable GAAP measures. Reconciliation of non-GAAP financial measures and the most directly comparable GAAP financial measures are included in the tables accompanying this press release.
Conference Call Information
AST SpaceMobile will hold a quarterly business update conference call at 5:00 p.m. (Eastern Time) on Thursday, November 14, 2024. The call will be accessible via a live webcast on the Events page of AST SpaceMobile’s Investor Relations website at https://ast-science.com/investors/. An archive of the webcast will be available shortly after the call.
About AST SpaceMobile
AST SpaceMobile is building the first and only global cellular broadband network in space to operate directly with standard, unmodified mobile devices based on our extensive IP and patent portfolio, and designed for both commercial and government applications. Our engineers and space scientists are on a mission to eliminate the connectivity gaps faced by today’s five billion mobile subscribers and finally bring broadband to the billions who remain unconnected. For more information, follow AST SpaceMobile on YouTube, X (Formerly Twitter), LinkedIn and Facebook. Watch this video for an overview of the SpaceMobile mission.
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 AST SpaceMobile to differ materially from those expected and projected. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “would,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology. 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 could 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 2 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 SpaceMobile’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 AST SpaceMobile to grow and manage growth profitably and retain its key employees and AST SpaceMobile’s responses to actions of its competitors and its ability to effectively compete; (iv) changes in applicable laws or regulations; (v) the possibility that AST SpaceMobile may be adversely affected by other economic, business, and/or competitive factors; (vi) the outcome of any legal proceedings that may be instituted against AST SpaceMobile; and (vii) other risks and uncertainties indicated in the Company’s filings with the Securities and Exchange Commission (SEC), including those in the Risk Factors section of AST SpaceMobile’s Form 10-K filed with the SEC on April 1, 2024.
AST SpaceMobile cautions that the foregoing list of factors is not exclusive. AST SpaceMobile cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. For
information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors in AST SpaceMobile’s Form 10-K filed with the SEC on April 1, 2024. AST SpaceMobile’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, AST SpaceMobile disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.
Investor Contact:
Scott Wisniewski
investors@ast-science.com
Media Contact:
Allison
Eva Murphy Ryan
917-547-7289
ASTSpaceMobile@allisonpr.com
Third Quarter Financial Results
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands, except share data)
| December 31, 2023 | |||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 516,389 | $ | 85,622 | ||
| Restricted cash | 2,497 | 2,475 | |||
| Prepaid expenses | 7,073 | 4,591 | |||
| Other current assets | 19,662 | 14,194 | |||
| Total current assets | 545,621 | 106,882 | |||
| Non-current assets: | |||||
| Property and equipment, net | 260,068 | 238,478 | |||
| Operating lease right-of-use assets, net | 12,088 | 13,221 | |||
| Other non-current assets | 3,872 | 2,311 | |||
| TOTAL ASSETS | 821,649 | $ | 360,892 | ||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 8,962 | $ | 20,575 | ||
| Accrued expenses and other current liabilities | 16,480 | 23,926 | |||
| Contract liabilities | 22,468 | - | |||
| Current operating lease liabilities | 1,534 | 1,468 | |||
| Current portion of long-term debt | 44,635 | 252 | |||
| Total current liabilities | 94,079 | 46,221 | |||
| Non-current liabilities: | |||||
| Warrant liabilities | 57,460 | 29,960 | |||
| Non-current operating lease liabilities | 11,057 | 11,900 | |||
| Long-term debt, net | 156,252 | 59,252 | |||
| Total liabilities | 318,848 | 147,333 | |||
| Commitments and contingencies | |||||
| Stockholders' Equity: | |||||
| Class A Common Stock, .0001 par value; 800,000,000 shares authorized; 170,039,305 and 90,161,309 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. | 17 | 9 | |||
| Class B Common Stock, .0001 par value; 200,000,000 shares authorized; 39,747,447 and 50,041,757 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. | 4 | 5 | |||
| Class C Common Stock, .0001 par value; 125,000,000 shares authorized; 78,163,078 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively. | 8 | 8 | |||
| Additional paid-in capital | 762,426 | 288,404 | |||
| Accumulated other comprehensive income | 353 | 227 | |||
| Accumulated deficit | (453,888 | ) | (189,662 | ) | |
| Noncontrolling interest | 193,881 | 114,568 | |||
| Total stockholders' equity | 502,801 | 213,559 | |||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 821,649 | $ | 360,892 |
All values are in US Dollars.
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in thousands, except share and per share data)
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Revenues | $ | 1,100 | $ | - | $ | 2,500 | $ | - | ||||
| Operating expenses: | ||||||||||||
| Engineering services costs | 21,828 | 19,523 | 62,546 | 58,818 | ||||||||
| General and administrative costs | 15,551 | 10,995 | 45,677 | 31,073 | ||||||||
| Research and development costs | 14,724 | 9,418 | 23,435 | 36,721 | ||||||||
| Depreciation and amortization | 14,543 | 19,029 | 54,880 | 34,877 | ||||||||
| Total operating expenses | 66,646 | 58,965 | 186,538 | 161,489 | ||||||||
| Other income (expense): | ||||||||||||
| (Loss) gain on remeasurement of warrant liabilities | (236,912 | ) | 7,481 | (284,839 | ) | 21,454 | ||||||
| Interest (expense) income, net | (1,386 | ) | 495 | (5,846 | ) | 4,311 | ||||||
| Other income (expense), net | 1,410 | 507 | 1,661 | (10,237 | ) | |||||||
| Total other income (expense), net | (236,888 | ) | 8,483 | (289,024 | ) | 15,528 | ||||||
| Loss before income tax (expense) benefit | (302,434 | ) | (50,482 | ) | (473,062 | ) | (145,961 | ) | ||||
| Income tax (expense) benefit | (646 | ) | (266 | ) | (1,172 | ) | 408 | |||||
| Net loss before allocation to noncontrolling interest | (303,080 | ) | (50,748 | ) | (474,234 | ) | (145,553 | ) | ||||
| Net loss attributable to noncontrolling interest | (131,134 | ) | (29,839 | ) | (210,008 | ) | (89,918 | ) | ||||
| Net loss attributable to common stockholders | $ | (171,946 | ) | $ | (20,909 | ) | $ | (264,226 | ) | $ | (55,635 | ) |
| Net loss per share attributable to holders of Class A Common Stock | ||||||||||||
| Basic and diluted | $ | (1.10 | ) | $ | (0.23 | ) | $ | (1.89 | ) | $ | (0.70 | ) |
| Weighted-average shares of Class A Common Stock outstanding | ||||||||||||
| Basic and diluted | 155,644,888 | 89,514,621 | 139,485,036 | 79,065,471 |
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)
(Dollars in thousands)
| For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Net loss before allocation to noncontrolling interest | $ | (303,080 | ) | $ | (50,748 | ) | $ | (474,234 | ) | $ | (145,553 | ) |
| Other comprehensive loss | ||||||||||||
| Foreign currency translation adjustments | 529 | (358 | ) | 190 | (526 | ) | ||||||
| Total other comprehensive loss | 529 | (358 | ) | 190 | (526 | ) | ||||||
| Total comprehensive loss before allocation to noncontrolling interest | (302,551 | ) | (51,106 | ) | (474,044 | ) | (146,079 | ) | ||||
| Comprehensive loss attributable to noncontrolling interest | (130,906 | ) | (30,050 | ) | (209,944 | ) | (90,226 | ) | ||||
| Comprehensive loss attributable to common stockholders | $ | (171,645 | ) | $ | (21,056 | ) | $ | (264,100 | ) | $ | (55,853 | ) |
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
| For the Nine Months Ended September 30, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| Cash flows from operating activities: | ||||||
| Net loss before allocation to noncontrolling interest | $ | (474,234 | ) | $ | (145,553 | ) |
| Adjustments to reconcile net loss before noncontrolling interest to cash <br>used in operating activities: | ||||||
| Depreciation and amortization | 54,880 | 34,877 | ||||
| Amortization of debt issuance costs | 3,047 | 374 | ||||
| Loss on disposal of property and equipment | 2,221 | - | ||||
| Loss (gain) on remeasurement of warrant liabilities | 284,839 | (21,454 | ) | |||
| Stock-based compensation | 20,617 | 10,595 | ||||
| Paid-in-kind ("PIK") interest expense | 2,959 | - | ||||
| Changes in operating assets and liabilities: | ||||||
| Prepaid expenses and other current assets | (7,940 | ) | 1,601 | |||
| Accounts payable and accrued expenses | (7,998 | ) | (6,215 | ) | ||
| Operating lease right-of-use assets and operating lease liabilities | 357 | 54 | ||||
| Contract liabilities | 22,468 | - | ||||
| Other assets and liabilities | 1,081 | 1,680 | ||||
| Net cash used in operating activities | (97,703 | ) | (124,041 | ) | ||
| Cash flows from investing activities: | ||||||
| Purchase of property and equipment | (92,095 | ) | (96,462 | ) | ||
| Net cash used in investing activities | (92,095 | ) | (96,462 | ) | ||
| Cash flows from financing activities: | ||||||
| Proceeds from debt | 145,000 | 63,500 | ||||
| Repayments of debt | (187 | ) | (180 | ) | ||
| Payments for debt issuance costs | (9,435 | ) | (9,653 | ) | ||
| Proceeds from issuance of common stock | 338,911 | 65,003 | ||||
| Payments for equity issuance costs | (6,903 | ) | (1,527 | ) | ||
| Proceeds from warrants exercises | 153,307 | - | ||||
| Issuance of equity under employee stock plan | 3,058 | 225 | ||||
| Employee taxes paid for stock-based compensation awards | (3,325 | ) | - | |||
| Net cash provided by financing activities | 620,426 | 117,368 | ||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 161 | (395 | ) | |||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 430,789 | (103,530 | ) | |||
| Cash, cash equivalents and restricted cash, beginning of period | 88,097 | 239,256 | ||||
| Cash, cash equivalents and restricted cash, end of period | $ | 518,886 | $ | 135,726 | ||
| Supplemental disclosure of cash flow information: | ||||||
| Non-cash activities: | ||||||
| Right-of-use assets obtained in exchange for operating lease liabilities | $ | - | $ | 6,709 | ||
| Non-cash investing and financing activities: | ||||||
| Purchases of property and equipment in accounts payable and accrued expenses | $ | 5,086 | $ | 7,120 | ||
| PIK interest paid through issuance of PIK notes | 2,959 | - | ||||
| Settlement of warrant liabilities by issuing shares | 257,337 | - | ||||
| Cash paid for: | ||||||
| Interest | $ | 6,694 | $ | 1,071 | ||
| Income taxes, net | 1,135 | 510 |
AST SPACEMOBILE, INC.
RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED MEASURES (UNAUDITED)
(Dollars in thousands)
| For the Three Months Ended September 30, 2024 | ||||||||
|---|---|---|---|---|---|---|---|---|
| GAAP Reported | Stock-Based Compensation Expense | Adjusted | ||||||
| Engineering services costs | $ | 21,828 | $ | (3,431 | ) | $ | 18,397 | |
| General and administrative costs | 15,551 | (3,379 | ) | 12,172 | ||||
| Research and development costs | 14,724 | - | 14,724 | |||||
| Depreciation and amortization | 14,543 | - | 14,543 | |||||
| Total operating expenses | $ | 66,646 | $ | (6,810 | ) | $ | 59,836 | |
| Less: Depreciation and amortization | (14,543 | ) | ||||||
| Adjusted operating expenses | $ | 45,293 | ||||||
| For the Three Months Ended June 30, 2024 | ||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| GAAP Reported | Stock-Based Compensation Expense | Adjusted | ||||||
| Engineering services costs | $ | 21,202 | $ | (2,032 | ) | $ | 19,170 | |
| General and administrative costs | 17,839 | (6,842 | ) | 10,997 | ||||
| Research and development costs | 4,460 | - | 4,460 | |||||
| Depreciation and amortization | 20,392 | - | 20,392 | |||||
| Total operating expenses | $ | 63,893 | $ | (8,874 | ) | $ | 55,019 | |
| Less: Depreciation and amortization | (20,392 | ) | ||||||
| Adjusted operating expenses | $ | 34,627 |
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 U.S. GAAP financial measure. We define Adjusted operating expense as Total operating expenses adjusted to exclude amounts of stock-based compensation expense and depreciation and amortization expense. We define Adjusted engineering services costs and Adjusted general and administrative costs as engineering services costs and general and administrative costs adjusted to exclude stock-based compensation expenses.
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 U.S. GAAP, and therefore have limits in their usefulness to investors. Because of the non-standardized definitions, these measures may not be comparable to the calculation of similar measures of other companies and are presented solely to provide investors with useful information to more fully understand how management assesses performance. These measures are not, and should not be viewed as, a substitute for their most directly comparable GAAP measure of Total operating expenses, Engineering services costs and General and administrative costs.
Transforming how the world connects Business Update – Third Quarter 2024 November 14, 2024 NASDAQ: ASTS ast-science.com
ast-science.com Forward Looking Statements The information in this presentation and the oral statements made in connection therewith includes “forward-looking statements” for the purposes of federal securities laws that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact in this presentation and the oral statements made in connection therewith regarding AST SpaceMobile, Inc.’s, collectively with its subsidiaries (“SpaceMobile” or the “Company”), financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek,” “plan,” “predict,” “potential,” and variations and similar words and expressions are intended to identify such forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in, or implied by, the forward-looking statements, please refer to the Risk Factors contained in AST SpaceMobile’s Annual Report on Form 10-K, filed with the SEC on April 1, 2024. The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Measures Adjusted operating expense is an alternative financial measure used by management to evaluate our operating performance as a supplement to our most directly comparable U.S. GAAP financial measure. We define Adjusted operating expense as total operating expenses adjusted to exclude amounts of stock-based compensation expense and depreciation and amortization expense. We believe Adjusted operating expenses is a useful measure across time in evaluating the Company's operating performance as we use Adjusted operating expenses to manage the business, including in preparing our annual operating budget and financial projections. Adjusted operating expense is a non-GAAP financial measure that has no standardized meaning prescribed by U.S. GAAP, and therefore has limits in its usefulness to investors. Because of the non-standardized definition, it may not be comparable to the calculation of similar measures of other companies and are presented solely to provide investors with useful information to more fully understand how management assesses performance. This measure is not, and should not be viewed as, a substitute for its most directly comparable GAAP measure of total operating expenses. Industry and Market Data This presentation includes market data and other statistical information from sources believed to be reliable, including independent industry publications, governmental publications or other published independent sources. Although AST SpaceMobile believes these sources are reliable, we have not independently verified the information and cannot guarantee its accuracy and completeness. Trademarks and Trade Names AST SpaceMobile owns or has rights to various trademarks, service marks and trade names that they use in connection with the operation of their respective businesses. This presentation also contains trademarks, service marks and trade names of third parties, which are the property of their respective owners. The use or display of third parties’ trademarks, service marks, trade names or products in this presentation is not intended to, and does not imply, a relationship with AST SpaceMobile, or an endorsement or sponsorship by or of AST SpaceMobile. Solely for convenience, the trademarks, service marks and trade names referred to in this presentation may appear without the ®, TM or SM symbols, but such references are not intended to indicate, in any way, that AST SpaceMobile will not assert, to the fullest extent under applicable law, their rights or the right of the applicable licensor to these trademarks, service marks and trade names.
Building the First and Only Space-Based Cellular Broadband Network ast-science.com 3
Key Highlights 4 Secured initial contract as a Prime Contractor to the U.S. Government First five commercial BlueBird satellites achieved successful initial operations and filed Special Temporary Authority (STA) request with FCC to begin beta service with AT&T and Verizon Secured orbital launch capacity to enable continuous space-based cellular broadband service coverage in key markets, including U.S., Europe, Japan, the U.S. Government and other strategic markets globally Expanded the AST SpaceMobile customer ecosystem, adding three new contract awards with the U.S. Government and continued to advance discussions with multiple commercial partners Strong balance sheet and liquidity with $518.9 million in cash, cash equivalents, and restricted cash, benefiting from warrant redemption and ATM program
First 5 commercial BlueBird satellites successfully unfolded BlueBird array unfold #2 BlueBird array unfold #1 First Five Commercial BlueBird Satellites Achieved Successful Initial Operations 5 Mission launch September 12th
Secured Orbital Launch Capacity to Enable Continuous Space-Based Cellular Broadband Service Coverage Announced launch agreements with Blue Origin, ISRO, and SpaceX to deliver AST SpaceMobile’s next-generation Block 2 BlueBirds Launch campaigns from Cape Canaveral Florida Space Force Station planned during 2025 and 2026 Blue Origin to become the third launch services provider in AST SpaceMobile history 6 Targeting continuous coverage in U.S., Europe, Japan, the U.S. Government and other strategic markets globally
Expanded the AST SpaceMobile Customer Ecosystem, Adding Three New Contract Awards With U.S. Government Selection by the Space Development Agency (SDA) to compete directly as a prime contractor under the Hybrid Application for proliferated low Earth orbit (HALO) program Growing pipeline of government opportunities for non-commercial applications demonstrates significant advantages of AST SpaceMobile’s dual-use technologies 7
When operational, SpaceMobile Service will be available to MNOs on a wholesale basis, with existing relationships spanning nearly all large countries (ex. China/Russia) potential coverage These MNOs have 2.8+ billion Subscribers globally 45+ MNOs Strategic Partners Selected MNO Partners 8 Continued Commercial Progress with Our Global Partners
Operating and Capital Metrics Adj. Operating Expenses 1 Liquidity 3 $M $M Non-GAAP. See appendix for a reconciliation. Adjusted operating expenses is equal to total operating expense adjusted to exclude depreciation and amortization and stock based-compensation expense. Depreciation and amortization for the three months ended September 30, 2024 and June 30, 2024 was $14.5 million and $20.4 million, respectively. Stock-based compensation for the three months ended September 30, 2024 and June 30, 2024 consisted of $3.4 million and $2.0 million of engineering services costs and $3.4 million and $6.8 million of general and administrative costs, respectively. Gross property and equipment as of September 30, 2024, June 30, 2024 and December 31, 2023 was $374.0 million, $347.5 million, $299.7 million, respectively. Accumulated depreciation and amortization as of September 30, 2024, June 30, 2024 and December 31, 2023 was $113.9 million, $99.3 million, and $61.2 million, respectively. Cash Position as of September 30, 2024 and June 30, 2024, respectively, includes $2.5 million of restricted cash. Capital Expenditures 2 $M ASIC
Appendix ast-science.com 11
Reconciliation to non-GAAP Measures – Adj. Operating Expenses Adj. operating expenses – 9 months ended ($ in thousands) Sept 30, '24 June 30,'24 Sept 30, '23 Engineering services costs 21,828 21,202 19,523 General and administrative costs 15,551 17,839 10,995 Research and development costs 14,724 4,460 9,418 Depreciation and amortization 14,543 20,392 19,029 Total operating expenses 66,646 63,893 58,965 Less: Depreciation and amortization (14,543) (20,392) (19,029) Less: Stock-based compensation expense 1 (6,810) (8,874) (2,589) Total adj. operating expenses 45,293 34,627 37,347 Stock-based compensation for the three months ended September 30, 2024, June 30, 2024, and September 30, 2023 consisted of $3.4 million, $2.0 million, and $1.5 million of engineering services costs and $3.4 million, $6.8 million, and $1.1 million of general and administrative costs, respectively. Stock-based compensation for the nine months ended September 30, 2024 and 2023 consisted of $7.1 million and $7.4 million of engineering services costs and $13.5 million and $3.2 million of general and administrative costs, respectively. Adj. operating expenses – 3 months ended ($ in thousands) Sept 30, '24 Sept 30, '23 Engineering services costs 62,546 58,818 General and administrative costs 45,677 31,073 Research and development costs 23,435 36,721 Depreciation and amortization 54,880 34,877 Total operating expenses 186,538 161,489 Less: Depreciation and amortization (54,880) (34,877) Less: Stock-based compensation expense 2 (20,617) (10,595) Total adj. operating expenses 111,041 116,017