AST SpaceMobile, Inc. Q2 FY2025 earnings call

• Manufacturing: Completed assembly of microns and phase arrays for 8 Block 2 BlueBird satellites; targeting 6 satellites per month manufacturing cadence by 2025; over 400,000 square feet of manufacturing space with a global workforce of over 1,200.
• Satellites: Block 2 BlueBirds are 3.5x larger with 10x capacity, enabling fewer satellites for coverage (45-60 for key markets, 90 for global); phase arrays have larger surface area for pinpoint precision and reduced interference.
• Commercial: Over 50 MNO partners with nearly 3 billion subscribers; preparing for nationwide interim service in US by end 2025, followed by UK, Japan, Canada in Q1 2026.
• Regulatory: Acquired 60 MHz global S-Band spectrum priority rights; Ligado transaction progress with court approval of definitive documents and FCC approval expected in 2026.
• Government: Recognized revenue on 4 milestones from US government contracts; won 2 additional early-stage contracts, expanding organizational capabilities for government business.

AST SpaceMobile's second quarter was highly productive. Manufacturing progress included completing assembly of microns and phase arrays for 8 Block 2 BlueBird satellites, with plans to complete ~40 satellite equivalents by early 2026. Commercial partnerships saw over 50 MNO partners with nearly 3 billion subscribers globally. Regulatory efforts included acquiring 60 MHz global S-Band spectrum priority rights and progress on the Ligado transaction. Government contracts saw recognition of revenue on 4 milestones and 2 additional early-stage contracts. No traditional product segment revenue contribution breakdown provided as it's not the focus.

• Revenue: Reiterates revenue opportunity in second half of 2025 in range of $50 million to $75 million, tied to satellite launches, gateway sales, and commercial service activations.
• Launch Cadence: Anticipate at least 5 orbital launches by end Q1 2026, with launches every 1-2 months, aiming for 45-60 satellites in 2025-2026 for key markets.
• Government Revenue: Expect revenue from US government business to ramp in coming quarters as milestones are achieved.

• Regulatory: Uncertainties in FCC approvals for Ligado transaction and spectrum usage.
• Launch Delays: Potential delays in satellite launches affecting connectivity goals.
• Revenue Realization: Risks associated with achieving satellite launches, gateway sales, and commercial service activations as planned.

Q: given the current launch cadence and near-term goals, is your current funding runway sufficient to reach initial commercial revenue or do you foresee additional capital needs?

A: The short answer is, yes, we do feel like our balance sheet combined with the opportunities we currently have for both government and commercial inflows in the near term, enable us to achieve a strategy that, again, set out originally with 5 satellites for key thresholds, 25 for positive operational cash flow and ultimately, 45 to 60 satellites for continuous service in strategic markets around the world. Given our pro forma balance sheet at the end of Q2 of over $1.5 billion, we do believe that we are fully funded now to reach the 45 to 60 satellite level and as part of that, our capital strategy going forward will be one focused not on threshold business delivery needs, but rather more commercial and strategic development. An optimal capital structure with additional financial support as appropriate. Of course focusing on de risking the business but not as the primary inflows for the business. Those will quickly convert to those government and commercial opportunities which are starting to commence.

Q: Investors are confused about the recent achievement of a first-ever native voice call VoLTE and text SMS. How does this differ between the voice, video, text achievements that you achieved in the past?

A: You know from last year when we did the first voice, the first video, the first text ever offer in space and the first 5G connection directly from our network of satellites directly to unmodified phones, that was done using partner spectrums and our core and our technology. What are you starting to see now? We are focusing on delivering nationwide service intermittent by the end of the year with our partners in the U.S., Europe, Japan and soon Canada. We are starting to do the full integration to the core infrastructure. So what you saw was our ability to actually do native calling directly from the dialer of the phone into space using the operator's core and operator infrastructure. So we had demonstrated multiple times our ability to do broadband directly from space to any phone of any manufacturer without doing any changes into the phone, without any modification to the phone.

Q: any further barriers to the Ligado transaction formally closing?

A: Thanks, Scott, for the question. Andy here. Since our last public update, the court did formally approved the definitive documents that were signed alongside the 80-year long-lived L-Band usage rights, which was a huge milestone in this transaction and that closed the transaction for us as a starting point. Separately, we did close the long-term nonrecourse SPV level financing. It's in the form of a delayed draw facility that we can use when we receive formal FCC approval. And in parallel, we're working to put in place bridge financing ahead of the FCC approval based on our receipt of a sponsor backstop commitment. So finally, we do feel good about the FCC on the L-Band. It's already authorized for usage of space for geostationary orbits, and we expect that to be a 2026 event for us. So look for initial filings on this front in the coming months. That's the next stage in the Ligado transaction.

Q: what is your current monthly production rate for Block 2 satellites, micron phased arrays and control stats? And what will it take to ramp up to 6 satellites per month? For example, is it a labor issue, supply chain issue or other issues?

A: Thank you, Kevin, for the question. In the next week or so, we will be at 9 satellites, in addition, obviously, of the 5 that we have already in orbit built. With that, we also have the capability now to basically get to 6 per month in terms of phased array production. And we feel that we will have around 40 phased arrays built by the end of the year very early in 2026 and at the rate of 6 satellites per month, with one launch every 45 to 60 days. So we are at rate of the phased array. We will think that we will be at rate of the full satellite later in the year this year for support our launch campaign of one launch every 45 to 60 days with six satellites per launch in average. So six to eight satellites per launching average. So that's what we have achieved at this point. We also have, you know, we now have close to 400,000 square feet of manufacturing facility. So space will not be an issue. We also have ramp out significantly with our production capacity. We have now over 1200 people working on the program. And we have had also secure the launches we seek, launches already secured and in the manifest of our partners following in '26 with a launch every 45 days with six to eight satellites per launch. So we're there, we're getting very, very close to basically hit our target to 45 to 60 satellites. As Andy answered before, we're fully funded for that. It's a lot of hard work, but we think that we are getting closer and closer to our goal.