AST SpaceMobile Fully Funded for First Five Communications Satellites
AST SpaceMobile (Nasdaq: ASTS) said it has raised up to $179 million in additional funds to build its first five BlueBird satellite-to-cell phone communications satellites and to launch them during the first quarter of next year, according to the company’s second-quarter earnings.
“AST SpaceMobile continues to make history. This quarter we achieved space-based 4G LTE cellular broadband capabilities to everyday smartphones, reaching speeds above 10 Mbps during BlueWalker 3 testing alongside AT&T, Vodafone and Nokia,” Chairman and CEO Abel Avellan said in a second-quarter earnings release. “We are now laser-focused on the manufacturing of our BlueBird satellites. The first five satellites are fully-funded with a planned launch in Q1 2024 as we target to offer initial commercial service in 2024.”
The company said the funding came from:
- $100 million senior secured credit facility with an initial gross draw of $48.5 million from Atlas Credit Partners.
- $57 million from a common stock offering in June 2023.
- $7 million from other stock sales during the second quarter of 2023.
- $15 million in an equipment-backed loan.
AST SpaceMobile said it had $191.5 million in cash, cash equivalents, and restricted cash when the second quarter ended on June 30, 2023. The company added up to $115 million since the quarter ended with the senior secured credit facility and equipment-backed loan.
The company said it has “received multiple indications of interest for strategic investment, including both equity-linked investments and non-dilutive commercial payments.”
AST SpaceMobile has received approval from the Federal Communications Commission (FCC) for a constellation of 243 communications satellites in 16 orbital planes. A test satellite, BlueWalker 3, was launched into orbit aboard a SpaceX Falcon 9 on September 10, 2022.
The company reported no revenue during the first six months of the year, a reduction from the $9.7 million it received during the same period in 2022.
AST SpaceMobile’s net loss was $18.4 million for the quarter, an increase over the $2.9 million reported during the second quarter of last year. The net loss for the first half of 2023 was $34.7 million, an increase from $13.6 million last year.
AST SpaceMobile reported total adjusted operating expenses of $38.4 million for the second quarter, a decrease of $1.9 million from $40.3 million during the first quarter of the year.
AST SpaceMobile
2023 Second Quarter Results
AST SPACEMOBILE, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands, except share data)
| June 30, 2023 | December 31, 2022 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 190,835 | $ | 238,588 |
| Restricted cash | 636 | 668 | ||
| Prepaid expenses | 7,127 | 4,100 | ||
| Other current assets | 22,976 | 24,954 | ||
| Total current assets | 221,574 | 268,310 | ||
| Property and equipment: | ||||
| Property and equipment | 194,145 | 152,968 | ||
| Less: Accumulated depreciation | (22,508) | (6,979) | ||
| Total property and equipment, net | 171,637 | 145,989 | ||
| Other non-current assets: | ||||
| Operating lease right-of-use assets, net | 13,486 | 7,671 | ||
| Other non-current assets | 1,770 | 16,402 | ||
| Total other non-current assets | 15,256 | 24,073 | ||
| TOTAL ASSETS | $ | 408,467 | $ | 438,372 |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||
| Current liabilities: | ||||
| Accounts payable | 5,108 | 13,929 | ||
| Accrued expenses and other current liabilities | 24,256 | 13,145 | ||
| Current operating lease liabilities | 1,305 | 722 | ||
| Total current liabilities | 30,669 | 27,796 | ||
| Warrant liabilities | 24,973 | 38,946 | ||
| Non-current operating lease liabilities | 12,314 | 7,046 | ||
| Long-term debt | 4,634 | 4,758 | ||
| Total liabilities | 72,590 | 78,546 | ||
| Commitments and contingencies | ||||
| Stockholders’ Equity: | ||||
| Class A Common Stock, $.0001 par value; 800,000,000 shares authorized; 89,404,419 and 71,819,926 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively. | 9 | 7 | ||
| Class B Common Stock, $.0001 par value; 200,000,000 shares authorized; 50,041,757 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively. | 5 | 5 | ||
| Class C Common Stock, $.0001 par value; 125,000,000 shares authorized; 78,163,078 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively. | 8 | 8 | ||
| Additional paid-in capital | 282,869 | 235,384 | ||
| Accumulated other comprehensive income (loss) | 158 | 229 | ||
| Accumulated deficit | (136,827) | (102,101) | ||
| Noncontrolling interest | 189,655 | 226,294 | ||
| Total stockholders’ equity | 335,877 | 359,826 | ||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 408,467 | $ | 438,372 |
AST SPACEMOBILE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in thousands, except share and per share data)
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Revenues | $ | – | 7,264 | $ | – | $ | 9,658 | ||||||||
| Cost of sales (exclusive of items shown separately below) | – | 2,202 | – | 4,189 | |||||||||||
| Gross profit | – | 5,062 | – | 5,469 | |||||||||||
| Operating expenses: | |||||||||||||||
| Engineering services costs | 22,813 | 11,999 | 39,296 | 23,716 | |||||||||||
| General and administrative costs | 10,221 | 13,075 | 20,078 | 24,718 | |||||||||||
| Research and development costs | 10,921 | 9,145 | 27,302 | 17,426 | |||||||||||
| Depreciation and amortization | 14,115 | 1,185 | 15,848 | 2,285 | |||||||||||
| Total operating expenses | 58,070 | 35,404 | 102,524 | 68,145 | |||||||||||
| Other income (expense): | |||||||||||||||
| Gain on remeasurement of warrant liabilities | 6,475 | 23,049 | 13,973 | 17,567 | |||||||||||
| Other income (expense), net | 1,217 | (679) | (6,927) | (664) | |||||||||||
| Total other income (expense), net | 7,692 | 22,370 | 7,046 | 16,903 | |||||||||||
| Loss before income tax benefit (expense) | (50,378) | (7,972) | (95,478) | (45,773) | |||||||||||
| Income tax benefit (expense) | 789 | (96) | 673 | (198) | |||||||||||
| Net loss before allocation to noncontrolling interest | (49,589) | (8,068) | (94,805) | (45,971) | |||||||||||
| Net loss attributable to noncontrolling interest | (31,181) | (5,144) | (60,079) | (32,326) | |||||||||||
| Net loss attributable to common stockholders | $ | (18,408) | (2,924) | $ | (34,726) | $ | (13,645) | ||||||||
| Net loss per share attributable to holders of Class A Common Stock | |||||||||||||||
| Basic and diluted | $ | (0.24) | (0.06) | $ | (0.47) | $ | (0.26) | ||||||||
| Weighted-average shares of Class A Common Stock outstanding | |||||||||||||||
| Basic and diluted | 75,640,650 | 51,868,658 | 73,753,412 | 51,814,888 | |||||||||||
AST SPACEMOBILE, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
(Dollars in thousands)
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Net loss before allocation to noncontrolling interest | $ | (49,589) | $ | (8,068) | $ | (94,805) | $ | (45,971) | |||||||
| Other comprehensive loss | |||||||||||||||
| Foreign currency translation adjustments | (40) | (166) | (168) | (598) | |||||||||||
| Total other comprehensive loss | (40) | (166) | (168) | (598) | |||||||||||
| Total comprehensive loss before allocation to noncontrolling interest | (49,629) | (8,234) | (94,973) | (46,569) | |||||||||||
| Comprehensive loss attributable to noncontrolling interest | (31,196) | (5,289) | (60,176) | (32,831) | |||||||||||
| Comprehensive loss attributable to common stockholders | $ | (18,433) | $ | (2,945) | $ | (34,797) | $ | (13,738) | |||||||
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
| For the Six Months Ended June 30, | |||||||||
| 2023 | 2022 | ||||||||
| Cash flows from operating activities: | |||||||||
| Net loss before allocation to noncontrolling interest | $ | (94,805) | $ | (45,971) | |||||
| Adjustments to reconcile net loss before noncontrolling interest to cash used in operating activities: | |||||||||
| Depreciation and amortization | 15,848 | 2,285 | |||||||
| Gain on remeasurement of warrant liabilities | (13,973) | (17,567) | |||||||
| Non-cash lease expense | 378 | 267 | |||||||
| Stock-based compensation | 8,006 | 4,695 | |||||||
| Issuance of common stock for commitment shares | – | 190 | |||||||
| Changes in operating assets and liabilities: | |||||||||
| Accounts receivable | – | (1,613) | |||||||
| Prepaid expenses and other current assets | (15,547) | (16,332) | |||||||
| Inventory | – | (2,313) | |||||||
| Accounts payable and accrued expenses | (4,112) | 2,838 | |||||||
| Operating lease liabilities | (343) | (261) | |||||||
| Deferred revenue | – | 1,393 | |||||||
| Other assets and liabilities | 16,559 | (16,116) | |||||||
| Net cash used in operating activities | (87,989) | (88,505) | |||||||
| Cash flows from investing activities: | |||||||||
| Purchase of property and equipment | (22,972) | (33,600) | |||||||
| Net cash used in investing activities | (22,972) | (33,600) | |||||||
| Cash flows from financing activities: | |||||||||
| Issuance of equity under employee stock plan | 180 | – | |||||||
| Proceeds from issuance of common stock, net of issuance costs | 63,567 | – | |||||||
| Proceeds from warrant exercises | – | 33 | |||||||
| (Repayments of) proceeds from debt | (120) | 230 | |||||||
| Net cash provided by financing activities | 63,627 | 263 | |||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (451) | (324) | |||||||
| Net (decrease) increase in cash, cash equivalents and restricted cash | (47,785) | (122,166) | |||||||
| Cash, cash equivalents and restricted cash, beginning of period | 239,256 | 324,537 | |||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 191,471 | $ | 202,371 | |||||
| Supplemental disclosure of cash flow information: | |||||||||
| Non-cash transactions: | |||||||||
| Purchases of property and equipment in accounts payable and accrued expenses | $ | 852 | $ | 1,718 | |||||
| Right-of-use assets obtained in exchange for operating lease liabilities | 6,510 | 272 | |||||||
AST SPACEMOBILE, INC.
RECONCILIATION OF GAAP REPORTED TO NON-GAAP ADJUSTED MEASURES (UNAUDITED)
(Dollars in thousands)
| For the Three Months Ended June 30, 2023 | ||||||||||||
| GAAP Reported | Stock-Based Compensation Expense | Adjusted | ||||||||||
| Engineering services costs | $ | 22,813 | $ | (4,458) | $ | 18,355 | ||||||
| General and administrative costs | 10,221 | (1,074) | 9,147 | |||||||||
| Research and development costs | 10,921 | – | 10,921 | |||||||||
| Depreciation and amortization | 14,115 | – | 14,115 | |||||||||
| Total operating expenses | $ | 58,070 | $ | (5,532) | $ | 52,538 | ||||||
| Less: Depreciation and amortization | (14,115) | |||||||||||
| Adjusted operating expenses | $ | 38,423 | ||||||||||
| For the Three Months Ended March 31, 2023 | |||||||||
| Stock-based Compensation | |||||||||
| GAAP Reported | Expenses | Adjusted | |||||||
| Engineering services costs | $ | 16,483 | $ | (1,392) | 15,091 | ||||
| General and administrative costs | 9,857 | (1,082) | 8,775 | ||||||
| Research and development costs | 16,381 | – | 16,381 | ||||||
| Depreciation and amortization | 1,733 | – | 1,733 | ||||||
| Total operating expenses | $ | 44,454 | $ | (2,474) | 41,980 | ||||
| Less: Depreciation and amortization | (1,733) | ||||||||
| Adjusted operating expenses | $ | 40,247 | |||||||
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 and define Adjusted engineering 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.
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