10-QPeriod: Q3 FY2022

AST SpaceMobile, Inc. Quarterly Report for Q3 Ended Sep 30, 2022

Filed November 14, 2022For Securities:ASTS

Summary

AST SpaceMobile, Inc.'s (ASTS) Q3 2022 10-Q filing reveals a company heavily invested in the development of its groundbreaking satellite-to-cellular broadband network. While revenues are minimal and derived solely from the divested NanoAvionika subsidiary, the company incurred significant operating expenses in engineering, R&D, and G&A, consistent with its pre-revenue, development-stage status. The primary focus remains on the BlueWalker 3 (BW3) test satellite, which successfully deployed its array in orbit, and the ongoing development of the BlueBird (BB) satellite constellation. Significant capital expenditures are planned for the satellite constellation. The company ended the quarter with $199.5 million in cash and cash equivalents. However, the significant operating losses and planned substantial capital expenditures for the satellite constellation indicate a continued need for external financing. The company highlights its successful 'at-the-market' equity offering programs, which provide a flexible source of capital. Investors should monitor progress on BW3 testing, the timeline and funding for the BB satellite constellation launch, and the company's ability to secure future capital to execute its ambitious plans.

Financial Highlights

49 data points
Beta

Revenue

$4.17M

39.4% Gross Margin

Net Income

-$9.77M

-234.3% Net Margin

EPS (Diluted)

$-0.18

Total Assets

$386.27M

Cash & Equivalents

$198.87M

Free Cash Flow

-$45.17M

Financial Statements
Beta
Revenue$4.17M
Cost of Revenue$2.52M
Gross Profit$1.64M
R&D Expenses$13.54M
Operating Expenses$42.12M
Net Income-$9.77M
EPS (Basic)$-0.18
EPS (Diluted)$-0.18
Shares Outstanding (Basic)53.23M
Shares Outstanding (Diluted)53.23M

Key Highlights

  • 1Successful deployment of the BlueWalker 3 (BW3) test satellite's communication array in orbit, with testing underway to demonstrate direct communication with standard cellular devices.
  • 2Continued significant investment in Research & Development and Engineering Services, with R&D expenses nearly doubling year-over-year, reflecting progress on the BlueBird (BB) satellite constellation and ASIC development.
  • 3Sale of 51% stake in former subsidiary NanoAvionika for net proceeds of $26.7 million, resulting in a gain of $24.6 million, which significantly boosted 'Other Income'.
  • 4Cash and cash equivalents stood at $199.5 million as of September 30, 2022, providing a runway for at least 12 months, though future capital raises are anticipated for constellation development.
  • 5Initiation of 'at-the-market' equity offerings through agreements with B. Riley and Evercore Group/B. Riley Securities, raising $13.4 million and $3.6 million respectively during the period, demonstrating access to capital.
  • 6Increased operating expenses across engineering, G&A, and R&D compared to the prior year, driven by increased headcount and development activities for the BB satellite constellation.
  • 7The company reported a net loss attributable to common stockholders of $9.8 million for the quarter and $23.4 million for the nine-month period, consistent with its developmental stage.

Frequently Asked Questions

The BlueWalker 3 test satellite successfully deployed its communication array in orbit on or around September 10, 2022. The company announced on November 14, 2022, that testing was underway to demonstrate its ability to communicate directly with standard, unmodified cellular devices using 3GPP standard frequencies at speeds comparable to 5G.

AST SpaceMobile ended the third quarter of 2022 with $199.5 million in cash and cash equivalents, which management believes is sufficient for at least 12 months. The company is also actively raising capital through 'at-the-market' equity offerings. Significant future capital expenditures for the BlueBird satellite constellation are anticipated, and the company expects to raise additional funds through equity or debt issuances.

The company does not expect to generate revenue until it begins launching and deploying its BlueBird (BB) satellites and initiates a limited, non-continuous SpaceMobile Service. The plan is to launch five Block 1 BB Satellites in late 2023, potentially leading to initial revenue generation thereafter, subject to regulatory approvals and definitive agreements with mobile network operators.

AST SpaceMobile completed the sale of its 51% interest in NanoAvionika on September 6, 2022. This sale resulted in net proceeds of approximately $26.7 million and a recognized gain of $24.6 million, which significantly boosted 'Other Income' for the period. As NanoAvionika was the company's sole source of revenue to date, the company will not recognize revenue from this source going forward until the SpaceMobile Service is launched.