AST SpaceMobile, Inc. (“AST SpaceMobile”) (NASDAQ: ASTS), the
company building the first and only space-based cellular broadband
network accessible directly by everyday smartphones, is providing
its business update for the three months ended March 31, 2023.
“AST SpaceMobile is making history,” said Abel Avellan, Chairman
and Chief Executive Officer of AST SpaceMobile. “Completing the
first-ever direct voice connection from our BlueWalker 3 test
satellite in space to everyday cellular devices in April was hailed
by our partners and leaders in the wireless ecosystem as the latest
‘first’ that changed the way people connect. This accomplishment
validated our technology in orbit, and confirmed we have the
ability to connect with everyday smartphones from all major handset
manufacturers in a market with over five billion mobile devices in
use today.”
Business Update
- Completed successful first-ever two-way voice calls from space
directly to everyday unmodified smartphones using the BlueWalker 3
(“BW3”) test satellite
- Key milestone in the BW3 testing program validates the
satellite technology, including the ability to work with everyday
smartphones and ability to integrate with the existing cellular
ecosystem, including spectrum
- Testing plan has transitioned to demonstration of 4G and 5G
download speeds
- Confirmed no major changes to the design of the Block 1
satellites following BlueWalker 3 testing
- Manufacturing underway in Midland, Texas, with production on
track for planned launch of five Block 1 BlueBird satellites in Q1
2024
- Signed spectrum lease agreement with AT&T, a first step to
offering commercial service to AT&T customers in the U.S.,
contingent upon regulatory approval and execution of a definitive
commercial agreement
First Quarter 2023 Financial Highlights
- Ended the first quarter with cash, cash equivalents, and
restricted cash of $185.7 million
- Total operating expenses increased by $1.9 million to $44.5
million for the first quarter of 2023, as compared to $42.6 million
in the fourth quarter of 2022, due to a $1.7 million increase in
research and development costs, $0.5 million increase in
engineering services and $0.5 million increase in depreciation and
amortization costs, offset by a $0.8 million decrease in general
and administrative costs
- As of March 31, 2023, the Company incurred $92.5 million of
capitalized costs (including launch costs and non-recurring
engineering costs) related to the assembly, testing and deployment
of the BlueWalker 3 test satellite
- As of March 31, 2023, the Company incurred approximately $66.5
million of capitalized property and equipment costs related to
development of assembly, integration, and test facilities in Texas,
as well as satellite related purchases including assembly
equipment, direct materials and antennas
Conference Call Information
AST SpaceMobile will hold a quarterly business update conference
call at 5:00 p.m. (Eastern Time) on Monday, May 15, 2023. 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 everyday
unmodified mobile devices based on our extensive IP and patent
portfolio. 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, 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 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 and level of deployment of 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; (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 SEC, including those in the Risk Factors section
of AST SpaceMobile’s Form 10-K filed with the SEC on March 31,
2023.
The planned testing of the BW3 test satellite may not be
completed due to a variety of factors, which could include loss of
satellite connectivity, destruction of the satellite, or other
communication failures, and even if completed as planned, the BW3
testing may indicate adjustments that are needed or modifications
that must be made, any of which could result in additional costs,
which could be material, and delays in commercializing our service.
If there are delays or issues with our testing, it may become more
costly to raise capital, if we are able to do so at all.
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 incorporated by reference into AST SpaceMobile’s Form
10-K filed with the SEC on March 31, 2023. 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.
First Quarter Financial Results
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED)
(dollars in thousands, except
share data)
March 31, 2023
December 31, 2022
ASSETS
Current
assets:
Cash and cash equivalents
$
185,043
$
238,588
Restricted cash
653
668
Prepaid expenses
3,228
4,100
Other current assets
38,185
24,954
Total current assets
227,109
268,310
Property and
equipment:
BlueWalker 3 satellite - construction in
progress
92,464
92,077
Property and equipment, net
66,452
53,912
Total property and equipment,
net
158,916
145,989
Other non-current
assets:
Operating lease right-of-use assets,
net
12,955
7,671
Other non-current assets
1,744
16,402
Total other non-current assets
14,699
24,073
TOTAL ASSETS
$
400,724
$
438,372
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current
liabilities:
Accounts payable
11,348
13,929
Accrued expenses and other current
liabilities
23,246
13,145
Current operating lease liabilities
952
722
Total current liabilities
35,546
27,796
Warrant liabilities
31,448
38,946
Non-current operating lease
liabilities
12,105
7,046
Long-term debt
4,696
4,758
Total liabilities
83,795
78,546
Commitments and contingencies
Stockholders'
Equity:
Class A Common Stock, $.0001 par value;
800,000,000 shares authorized; 71,877,559 and 71,819,926 shares
issued and outstanding as of March 31, 2023 and December 31, 2022,
respectively.
7
7
Class B Common Stock, $.0001 par value;
200,000,000 shares authorized; 50,041,757 shares issued and
outstanding as of March 31, 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 March 31, 2023 and December 31, 2022,
respectively.
8
8
Additional paid-in capital
236,886
235,384
Accumulated other comprehensive income
(loss)
183
229
Accumulated deficit
(118,419
)
(102,101
)
Noncontrolling interest
198,259
226,294
Total stockholders' equity
316,929
359,826
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY
$
400,724
$
438,372
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
(dollars in thousands, except
share and per share data)
Three Months ended March
31,
2023
2022
Revenues
$
-
$
2,394
Cost of sales (exclusive of items shown
separately below)
-
1,986
Gross profit
-
408
Operating
expenses:
Engineering services
16,483
11,740
General and administrative costs
9,857
11,619
Research and development costs
16,381
8,281
Depreciation and amortization
1,733
1,100
Total operating expenses
44,454
32,740
Other income
(expense):
Gain (loss) on remeasurement of warrant
liabilities
7,498
(5,482
)
Other income (expense), net
(8,144
)
15
Total other income (expense),
net
(646
)
(5,467
)
Loss before income tax expense
(45,100
)
(37,799
)
Income tax expense
(116
)
(104
)
Net loss before allocation to
noncontrolling interest
(45,216
)
(37,903
)
Net loss attributable to noncontrolling
interest
(28,898
)
(27,182
)
Net loss attributable to common
stockholders
$
(16,318
)
$
(10,721
)
Net loss per share attributable to holders
of Class A Common Stock
Basic and diluted
$
(0.23
)
$
(0.21
)
Weighted average shares of Class A Common
Stock outstanding
Basic and diluted
71,845,206
51,760,520
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED)
(dollars in thousands)
Three Months ended March
31,
2023
2022
Net loss before allocation to
noncontrolling interest
$
(45,216
)
$
(37,903
)
Other comprehensive loss
Foreign currency translation
adjustments
(128
)
(432
)
Total other comprehensive loss
(128
)
(432
)
Total comprehensive loss before allocation
to noncontrolling interest
(45,344
)
(38,335
)
Comprehensive loss attributable to
noncontrolling interest
(28,980
)
(27,542
)
Comprehensive loss attributable to common
stockholders
$
(16,364
)
$
(10,793
)
AST SPACEMOBILE, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
(dollars in thousands)
Three Months ended March
31,
2023
2022
Cash flows from operating activities:
Net loss before allocation to
noncontrolling interest
$
(45,216
)
$
(37,903
)
Adjustments to reconcile net loss before
noncontrolling interest to cash used in operating activities:
Depreciation and amortization
1,733
1,100
(Gain) loss on remeasurement of warrant
liabilities
(7,498
)
5,482
Non-cash lease expense
306
170
Stock-based compensation
2,474
2,254
Changes in operating assets and
liabilities:
Accounts receivable
-
(470
)
Prepaid expenses and other current
assets
(12,168
)
(6,838
)
Inventory
-
(457
)
Accounts payable and accrued expenses
5,553
2,684
Operating lease liabilities
(300
)
(112
)
Deferred revenue
-
1,333
Other assets and liabilities
17,383
(14,751
)
Net cash used in operating activities
(37,733
)
(47,508
)
Cash flows from investing activities:
Purchase of property and equipment
(15,228
)
(4,660
)
BlueWalker 3 satellite - construction in
process
(160
)
(16,907
)
Net cash used in investing activities
(15,388
)
(21,567
)
Cash flows from financing activities:
Issuance of incentive equity units under
employee stock plan
96
31
Proceeds from warrant exercise
-
2
(Repayments of) proceeds from debt
(60
)
97
Net cash provided by financing
activities
36
130
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(475
)
(482
)
Net decrease in cash, cash equivalents and
restricted cash
(53,560
)
(69,427
)
Cash, cash equivalents and restricted
cash, beginning of period
239,256
324,537
Cash, cash equivalents and restricted
cash, end of period
$
185,696
$
255,110
Supplemental disclosure of cash flow
information:
Non-cash transactions:
Purchases of construction in process in
accounts payable and accrued expenses
$
3,651
$
1,483
Purchases of property and equipment in
accounts payable and accrued expenses
426
1,661
Right-of-use assets obtained in exchange
for operating lease liabilities
5,507
191
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version on businesswire.com: https://www.businesswire.com/news/home/20230515005762/en/
Investor Contact: Scott Wisniewski
investors@ast-science.com
Media Contact: Allison+Partners Eva Murphy Ryan
917-547-7289 ASTSpaceMobile@allisonpr.com
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