10-QPeriod: Q1 FY2021

AST SpaceMobile, Inc. Quarterly Report for Q1 Ended Mar 31, 2021

Filed May 18, 2021For Securities:ASTS

Summary

This 10-Q filing for AST SpaceMobile, Inc. (formerly New Providence Acquisition Corp.) covers the period ending March 31, 2021, and is notable as it details the company's financial status immediately preceding its significant business combination with AST & Science LLC, which closed on April 6, 2021. As a SPAC (Special Purpose Acquisition Company), the primary financial activity involved managing funds raised from its IPO and preparing for the business combination. The company reported a net income of $597,052 for the quarter ended March 31, 2021, largely driven by changes in the fair value of warrant liabilities, rather than operational revenue, as it had not yet commenced significant operations. The balance sheet shows a substantial amount held in a trust account, primarily in marketable securities, amounting to over $231 million. Operating costs were reported at approximately $1.4 million for the quarter. Key developments include the anticipation and subsequent closing of the business combination shortly after the reporting period. This event fundamentally transformed the company from a SPAC into an operational entity focused on satellite-based mobile connectivity. Investors should note the substantial cash balance of over $50 million at quarter-end, bolstered by early deposits from PIPE investors in anticipation of the merger.

Financial Highlights

36 data points
Beta

Revenue

$951K

5.8% Gross Margin

Net Income

-$11.58M

-1217.7% Net Margin

EPS (Diluted)

$0.04

Total Assets

$282.07M

Cash & Equivalents

$50.05M

Free Cash Flow

-$11.26M

Financial Statements
Beta
Revenue$951K
Cost of Revenue$896K
Gross Profit$55K
R&D Expenses$304K
Operating Expenses$12.11M
Operating Income-$1.43M
Net Income-$11.58M
EPS (Basic)$0.04
Shares Outstanding (Basic)13.83M

Key Highlights

  • 1The report details the financial state of the company prior to its business combination with AST & Science LLC, which was completed on April 6, 2021.
  • 2As of March 31, 2021, the company held $231,913,996 in marketable securities within its Trust Account.
  • 3The company reported a net income of $597,052 for the three months ended March 31, 2021, primarily due to changes in the fair value of warrant liabilities and interest income, not operational revenue.
  • 4Operating costs for the quarter ending March 31, 2021, were $1,434,836.
  • 5Cash and cash equivalents increased significantly to $50,052,736 by March 31, 2021, due to early deposits from PIPE investors related to the upcoming business combination.
  • 6A material weakness in internal controls related to the accounting of warrants was identified, leading to a restatement of prior periods and ongoing remediation efforts.
  • 7The company had not commenced any operations as of March 31, 2021, and its activities were primarily related to its formation and the business combination.

Frequently Asked Questions

As a SPAC (Special Purpose Acquisition Company) prior to its business combination, AST SpaceMobile's primary financial activities involved managing funds raised from its Initial Public Offering, which were largely held in a trust account, and preparing for the business combination with AST & Science LLC. The company had not yet commenced revenue-generating operations.

For the three months ended March 31, 2021, AST SpaceMobile reported a net income of $597,052. This income was largely due to non-operational factors, including a gain from the change in fair value of warrant liabilities ($2,028,000) and interest income ($21,197), offset by operating costs of $1,434,836.

On April 6, 2021, shortly after the quarter end, the company completed its business combination with AST & Science LLC. This merger transformed NPA into AST SpaceMobile, Inc., marking the transition from a SPAC to an operating company focused on satellite-based mobile services.

This line item represents shares of Class A common stock that holders had the right to redeem for cash at a specified price (typically $10.00 per share plus accrued interest) if they did not vote in favor of the business combination or for other specified reasons. These shares are classified as temporary equity because their redemption is outside the company's control.