AST SpaceMobile, Inc. Q1 FY2025 earnings call

• Orbital Launches: Expect to deploy over 60 satellites in 2025-2026, with five launches in next 6-9 months. Target to build 40 Block 2 BlueBird satellites, aiming for 6 satellites per month manufacturing cadence by Q4 2025 and equivalent for microns/phased arrays by Q3 2025. - ASIC: Novel ASIC chips undergoing assembly/testing, validation/qualification nearly complete, expected available for satellite integration by June 2025. - Commercial: Integrating services with M&O partners; Rakuten Mobile did video call in Japan using Block 1 satellites; received FCC authority for FirstNet on public safety Band 14. - Government: $43M contract with U.S. Space Development Agency, new contract award with DIU; dual-use satellite technology validating revenue streams. - Financials: Non-GAAP adjusted cash operating expenses $44.9M in Q1 2025, capital expenditures $124M; expect adjusted OpEx ~$45M in Q2 2025, CapEx to increase; cash at $874.5M, new $500M ATM facility, evaluating equipment loan and non-dilutive funding.

No detailed product segment financial performance with revenue contribution % provided in the transcript.

• Revenue opportunity in 2025 is $50M-$75M, back end loaded, dependent on successful satellite launches, gateway equipment sales, and service activations. - Capital costs per satellite estimated at $21M-$23M, up from previous estimate due to higher launch costs and tariffs. - Expect revenue to ramp towards end of 2025 and into 2026.

• Geopolitical factors impacting direct materials costs. - Uncertainty in achieving launch and revenue milestones. - Volatility in the macro climate affecting capital markets and ability to raise adequate capital.

Q: Any further details to share on the Ligado transaction?

A: AST to acquire usage rights for 45 megahertz of mid-band spectrum in the US, definitive agreements signed end of March, approval process on schedule with separate financing package for L-band acquisition.

Q: Looks like the defense use-case is growing. What is the outlook there?

A: Government demand for space-based solutions is surging; already deriving revenue from government contract awards, with clear paths for applications in various use cases, including a $43M contract with Space Development Agency and a DIU contract.

Q: Do you plan to submit any proposals for the announced $25 billion Golden Dome project?

A: AST is well-positioned with technology to contribute to Golden Dome, size and power of satellites are unique and differentiated, enabling national security applications.

Q: Are shareholders expected to be invited to future launches this fall?

A: Yes, will host shareholders at Cape launch events, with upcoming launch in July not inviting due to external factors but expecting more events at Cape.

Q: On Monday April 28, there was a power outage in Spain/Portugal. Any short term plans for Europe?

A: AST's service provides cellular broadband connectivity in emergencies; joint venture with Vodafone distributes service in Europe, sharing ground infrastructure for geographic boundaries and emergency needs.

Q: Discuss nature of higher launch costs and relation to passing costs to launch suppliers.

A: Higher launch costs due to pulling forward launches to get service to market faster and tariff impact on materials; focus is on getting satellites built and launched quickly, with revenue opportunity mitigating cost increase.

Q: Talk about spectrum portfolios and sharing, EchoStar's spectrum, FCC commentary.

A: Spectrum is fuel for business; strategy is combination of low-band with MNO partners and mid-band from Ligado, enabling high data rates and supporting native applications; spectrum strategy includes premium low-band and mid-band for coverage and capacity.

Q: Bifurcated strategy of low band with MNOs and Ligado spectrum, impact on MNO agreements.

A: Focus is on user experience; low-band gives access to billions of subscribers, Ligado spectrum enhances capacity for filling network imperfections, both part of network to support end users.

Q: Update on beta tests with carrier partners and manufacturing cadence.

A: Beta tests ongoing with carriers, supporting video calls and native applications; manufacturing cadence of 6 satellites per month by Q4 2025 on target, with launch of larger satellites scheduled, and ASICs available soon.

Q: Capital needs for 2026 launch of 60 satellites and evaluation of funding sources.

A: Focus on non-dilutive capital, with revenue opportunity and balance sheet strength; ATM facility provides flexibility, with priority on prepayments from partners and exploration of non-dilutive financing sources like EXIM Bank.

Q: Ligado spectrum implementation and Barcelona facility use.

A: Ligado spectrum support is part of core technology design; Barcelona facility is for manufacturing high-reliability parts, with final integration in Texas; gateways deployed with fewer numbers due to large satellite field of view.

Q: Update on commercial launch in US, wholesale agreements with carriers.

A: Definitive agreements with AT&T, working on Verizon; beta service by end of 2025, commercial service early 2026, supporting text, internet, data, video conferencing; Ligado spectrum needed for network imperfections and capacity to support full user experience.

Q: Ligado spectrum in North American cell phones and progress.

A: L-band already in Android ecosystem, with support from operators; expected to have full band in phones soon, providing better coverage and capacity.

Q: U.S. government budget and opportunities, FEMA impact.

A: U.S. government using AST's technology, with DIU contract receiving additional funding; broad-based dialogue and positive momentum in government opportunities, including incremental funding in certain areas.

Q: Number of satellites in first five launches this year and competitive moat.

A: First five launches have mix of launch providers, with large satellites and dual-use technology providing competitive edge; larger satellites and dual-use capabilities differentiate from competitors with smaller satellites, supporting broadband and government applications.

Q: Block 2 BlueBird launch status and transition to ASICs.

A: Block 2 BlueBird is full operational satellite, production line shifts to ASICs in later launches; FM1 is first, with 40 satellites planned this year.

Q: Revenue breakdown in second half of 2025 and gateway margin.

A: Revenue includes government milestone payments and commercial revenue from gateway installations and activations; gateways are enablers with low margin, initial focus on U.S., Europe, Japan, and selected markets with prepayments from MNOs.

Q: DIU contract nature and conversations with primes.

A: DIU contract is for germinating new use cases across government agencies, with $20M potential, a place to accelerate use cases; conversations with primes like Lockheed and others to push government applications.