Q2 2021 Astra Space Inc Earnings Call

August 12, 2021

[music].

Okay.

Good afternoon wanted to ask for a second quarter 2021 earnings conference call. Joining us today are astra's, founder Chairman and CEO, Chris Kim CFO, Kevin Brennan, and Vice President of compliance and Deputy General Counsel, Michael Stitcher at this time all participants are in a listen only mode. After the speakers' presence.

<unk> there'll be a question and answer session to ask a question during the session need to press star one on your telephone if you require any further assistance. Please press star Zero I would now like to turn the call over to Michael for introductory remarks. Please go ahead.

Okay.

Thank you operator, good afternoon, everyone. Thank you for joining us for <unk> second quarter 2021 earnings call. After the market closed we released our financial results.

Earnings release is available on the SEC website, and our Investor Relations website at Investor Dot <unk> Dot Com, where you can also find a link to our investor presentation.

Conference is also being broadcast over the Internet and will be archived and available on our Investor Relations website.

During our call today, we will reference non-GAAP financial measures, which we believe to be useful to investors as our management team uses these non-GAAP financial measures to plan monitor and evaluate our financial performance. These non-GAAP financial measures exclude certain items and should not be considered a substitute for comparable GAAP financial measures.

Astra's method of computing, the non-GAAP financial metrics may differ from similar non-GAAP financial measures used by other companies.

A description of these items along with the reconciliation of our non-GAAP financial measures to their most comparable GAAP financial measures can be found in our earnings release. Today's call will also contain forward looking statements that refer to future events, including astra's future financial outlook when used in this call the words anticipate could.

Enable estimate intend expect believe potential will should project and similar expressions as they relate to aster are as such a forward looking statements. These forward looking statements are subject to a number of risks and uncertainty and as a result astra's acts.

Future results and performance may differ materially from those discussed in this call.

We encourage you to review our filings with the SEC and which we describe the factors that could cause actual results to differ materially.

Current expectations.

We also refer to commercial launches in this press release, when we use the phrase commercial launch commercial revenue launch for commercial orbital watch media launch conducted under an FAA commercial watch license.

Each of our launch vehicles as noted by an asset title with the abbreviation of Lv standing in for launch vehicle followed by the serial number for instance, our current launch vehicle as referenced at LD 0006.

Finally, I would like to remind everyone that this call will be recorded and it will be made available for replay via a link available on the Investor Relations section of our website with that I would now like to turn call over to Chris Astra's, founder Chairman and CEO Chris.

Thanks, Michael and good afternoon, everyone and thank you for joining US today welcome to our first earnings call as a public company.

Key by three.

The end of our second quarter coincide with the completion of our merger transaction with <unk>, which generated $454 million of net cash proceeds.

And our continued development and Mark the start of Astro trading on the NASDAQ exchange under the ticker <unk> PR on July <unk>.

Both of these events are major milestones in our mission to improve clutter from space.

Another important milestone in our upcoming launch nicely esports, which we announced last week.

Our first commercial launch in the first launch of our upgraded three three versus rocket, which I'll discuss later the state.

<unk> launched as planned during the Windows in August 27, and reopened through September 11th.

And we'll test after the ability to deliver a payload to precise orbit.

We used the opportunity to serve as big for us in the first of several launches aimed at validating their use of low cost mobile and responsible on services.

All of us at Astro are excited to get back that space.

I want to spend a few minutes discussing askers mission deliver rapid low cost access to data and I'll share some highlights from our second quarter.

More detail on our current and future areas of focus later calendar will walk you through the financial highlights for the second quarter.

Move on to slide four.

For those of you who needed gas story, Bruce some brief background.

Adam London, My co founder and I spent years independently learning about the difficulty cost effectively access base working with NASA.

DARPA, another leading technology organizations.

We were lucky enough to cross paths and share common views on bringing innovation to space, namely the inefficiency of the prior 50 years is directly attributed to the approach of legacy Aerospace companies Big rocket 93 people or very expensive satellite burdened by inefficient supply chain and underwritten by.

Deep pocketed governance.

Little incentive to entity.

We believe that the space industry ripe for technology innovation.

Hey, Steve Technology is gaining traction with new low reported.

Satellite, which have rapidly become smaller cheaper and more numerous than legacy.

The challenge is the launch vehicle is not involved in the same way.

Gross profit remained focus on physical sites.

And the level of reliability necessary to carry out human space flight missions and deliver large communication satellite to geostationary orbit.

Tens of thousands of miles from our <unk>.

As a result, we mostly existing launch equals a too large too expensive too infrequently launch and Additionally responded to meet the needs of the emerging APAC.

Great.

Please turn to slide five.

We aim to solve this problem with the worlds first Matt.

<unk> produced orbital launched system.

A small launch vehicles and mobile launch infrastructure. They can fitted by standard shipping containers that can be rapidly deployed anywhere in the world are rocket requires a launch by mid year, we had concrete path supported six equal appeal, leveraging our highly automated launch operations.

Our rockets payload capacity.

Needs of modern Leo satellite operations, allowing precise and rapid placement at individual satellites.

The required work.

We believe this may astra's system, more responsive and affordable alternative for the thousands of Leo satellites planned for launch in the next decade.

In December 2020, we successfully launched rocket three to altitude of 380 kilometers successfully passing the carbon line and demonstrating orbital launched capability.

As launch demonstrate durable capability and.

In identically performing launch complete enamel for example, would've reached orbit at our target orbital velocity and target allergies.

Launching for polar orbit by Kodiak Alaska.

Wired more performance and low inflation levels.

While we considered making only small changes in fine again, given how well the rest of the system performed decided to complete the remaining upgrades planned to increase endless capacity and transition the launch vehicles into production.

Highlights of our upgrades include stretching the first stage is to increase the delta that we.

Reducing the math of the upper stage.

And centers to gather more data not quite environments and consolidating over a dozen needed to components on the upper stages with similar numbers.

The only changes to accomplish system like a rocket always involves risks.

We appreciate this but also believe that maximizing our learning requires us to lease advances and take appropriate technical risks.

With rockets.

Launched Hulu right test the entire system.

So we carefully evaluated all of our changes.

Pleaded component system testing and shifts Lv euro six to.

Kodiak.

The upcoming launch for Europe.

As we move forward to a more regular launch cadence astra's fortunate to have customers investors and team members with the grid to endure the risks inherent in the development of the new launch system, because they understand the importance of frequent low cost access to space.

At nearly five years of hard work incredible room.

This strategy has allowed us to reach the milestone of our first commercial orbital launched in less than half the time of our peers.

While we are proud to be the fastest launch company to restate and demonstrate mobile capability. We acknowledge that we must continue to be relentless in our development and rigorous in our testing to maximize the probability of success of each new version of our system.

Even if we did not guarantee it.

We set this challenge and regardless of the outcome of our upcoming launch we have additional rocket on the production line and remain on plan to complete these launches before the end of the year.

To this end, we began ramping up hiring of production personnel and we're pleased with the quality of the talent. We continue to attract our target for this design is to ultimately produce and launch this version of our rocket at a monthly rate with the next two rocket LTE Euro Europe downturn and LD Europe Europe eight.

Currently taking shape in our factories.

Please turn to slide six.

Turning to market demand and excitement about our new wave of small satellites, Leo and well capitalized constellation customers.

Strong demand for launch services.

Customer indications of launch needs suggest that demand is years away from being fulfilled our differentiated low cost rapid launch strategy combined with our demonstrated success in 2020.

Abstract and that the backlog of over 50 launches representing over $150 million of contracted revenue.

Which we disclosed in our February merger announcements.

Earlier this year, we announced our second NASA contract tropics.

Additive and thorough bidding process versus other major launch service companies.

Traffic was a prelaunch contract to rapidly deploy at global six satellite operation to serve comparable type firms.

Highlights the benefits of astra's approach to responses small launch. This was after second NASA wins in a row after receiving the pls to stagnation contract in December of last year.

Following the two NASA wins, we announced the launch agreement with Planet Labs.

<unk> expects to be in multi launch mission for plant starting in 2022 to further its position as the leading provider of global <unk> satellite imagery and geospatial solutions.

And earlier this week, we announce Astro was awarded the orbital servicing program with the four contracts from a rapid system launch program for the space Force. This positions us to compete Brookfield illusion launch services over the next nine years.

We also announced the launch contract expired today.

NASA planet Spaceports inspire wins, our objective evidence of both our technical capability and the cost efficient monster fits for government and commercial customers.

Sure.

We would like them.

Turning to recent company developments.

In June we announced the acquisition of our fusion, a leading design and manufacturing companies some of the world's most efficient electric propulsion engines.

The purchase price per followed with $145 million.

<unk> earn outs I'm, particularly pleased that apollo's like the abstract amongst a handful of competitive offerings.

I would like to receive two thirds of the total consideration in astra's shares.

Testament to the vision of our joint opportunity.

Apollo is a real differentiator for aster customers by allowing them to move beyond Leo to medium Geo and even lunar orbit or maintain any orbit for a longer period of time.

In addition to pollinate Astro more versatile launch provider as well as increases our total addressable market.

Our incredible team led by CEO, Mike capacity will also play a key role in the development of our spacecraft platform.

We turn to our state of the army facilities.

Astra headquarters is located on the former U S Naval Air station in Alameda, California.

Just on the San Francisco Bay, 15 minutes outside of deep financial District.

And currently reside more than 100000 square feet of manufacturing office and launched system development space. In May we began an expansion of more than 200000 square feet, which we expect to complete by the end of this year.

We'll complete our facilities total approximately 350000 square feet and up to support our long term plans, increasing one rocket per day.

Our facilities are unique differentiator in the space SEC industry.

Almost all of our competitors with transport that rocket engines from the factory to remote locations to test performance.

During his years with experience at other launch companies describe a lengthy and highly inefficient process.

Engine performance by testing and remote locations are.

Our facility is unique in the industry and permits us to test engine multiple times a day every day.

This is a key enabler of our bold to constantly improve.

Moving to slide eight.

Now onto our incredible team.

All of our efforts literally hospital about building on our extraordinary team.

A significant portion of my time identifying recruiting talented people to help us accomplish great things Astro.

Our goal is more than just hiring smart people. We're building a culture that is comfortable taking on challenges overcoming.

Several high profile hires joined Astra, leading companies like Apple Facebook Tesla Blue origin.

Something unique and untried and safe industry.

Adam and I take great pride in the Covid aster really admire their grit and determination.

During the second quarter, we added 62 employees and ended the quarter with 188 total employees.

Most of these additions are in areas of design and engineering software to keep us in the past David watches.

We made several important strategic additions to our board in the past couple of months, we're thrilled to welcome our newest board members, including the shelf Bornite and decent Nelson, we announced yesterday and earlier today Michelle.

Michelle Lisa joined current independent Board of Directors, Mike Lehman and Craig recall, both of whom joined in June and our long term director and a trusted mentor Scott Stanford for equity capital, who served as our lead independent director.

A few words about our board members.

We shall forward I would definitely assistant Secretary of defense for strategy under President Bill Clinton and under Secretary of Defense for policy under President Obama.

Widely respected and strategic advisor reviews.

Periods in the defense industry.

<unk> also spent 14 years at Microsoft in various executive positions were Cofounded, Microsoft venture group and 12.

Jude and accomplished executive with global Defense, and finance and business development history with Baidu, serving on boards of young with companies.

Women presented extensive CFO and general finance experience.

<unk> been highly successful technology companies, such as Arista networks, Palo Alto networks and Sun Microsystems.

Finally pregnant cost chairman and CEO of the river, which is focused on strategic investments in the telecommunications industry credit and a successful entrepreneur who started to built many companies with cable cellular and broadband industry, including the crop failure.

Yes.

Extremely working to have this group of talented knowledgeable and passionate advisors to help us navigate and execute our verticals in this emerging space SEC industry.

Now I'd like to turn the call over to our CFO, Helen Brendan to discuss our second quarter results.

Thank you Chris.

And good afternoon, everyone as Chris noted, our second quarter results for steady and solid and we continue moving from primarily development driven company to a production focus.

Now let me run through the details as a reminder, all non revenue financial figures I will discuss today are non-GAAP unless I state them as a GAAP measure youll find a reconciliation from GAAP to non-GAAP results in today's press release.

On June 30th we completed our merger with policy this transaction, including the pipe transaction led by Blackrock provided Astro was $464 million of cash proceeds and offers US a solid foundation as we progress to our plan of reaching a daily launch cadence.

These cash proceeds from net of certain onetime expenses related to underwriting legal accounting and other changes.

Earlier this week, we filed our amended form S. One registration statement with the SEC in connection with that filing we registered the resell of shares issued to our pipe investors certain of our affiliates and the holistic sponsor and the business combination.

We also registered the shares issuable pursuant to the public and private warrants that were issued prior to the <unk> and the shares are issued and issuable pursuant to our Apollo fusion transaction, we have not yet met the requirements to do a mandatory redemption of the outstanding public warrants and <unk>.

As a result, we have not decided whether we would redeem the warrants if we meet such requirements.

As Chris mentioned in his remarks, we plan to launch our first commercial commercial tests payload.

For space Force as the window opens between August 27 through September 11th.

Contract, we have with the space Force also includes a second launch that we expect to occur later this year.

We ended the quarter with cash cash equivalents and restricted cash of $452.4 million.

We did not generate any revenue during the second quarter.

Q2, 2021 adjusted net loss.

$23.1 million.

And $31.3 million on a GAAP basis.

Adjusted EBITDA was a loss of $21.4 million for the quarter.

Capital expenditures totaled $8.5 million in the second quarter comprised primarily of the expansion of our Alameda headquarters.

And investments in manufacturing equipment.

Next I'll provide an outlook for our third quarter ending September 32021.

We currently expect adjusted EBITDA to be a loss between approximately $32 million and $35 million.

Depreciation and amortization to be between 1 million and $1.3 million.

Stock based compensation to be between 6 million and $10 million.

Cash taxes are forecasted to be zero.

Basic shares outstanding to be between $265 million and $260 million and.

And capital expenditures to be between 10 million and $15 million.

Let me provide a bit more context on our expected spend for Q3.2021.

Third quarter operating expenses are tracking ahead of our projected financials and we will be up sequentially from Q2.2021. The increase is due to our broader investment in our product roadmap program execution and operational capacity as we look to expand opportunities.

And our operational model. In addition, we accelerated head count and our back office functions to strengthen our ability to support the business and operate as a public company.

Offsetting the increase in operating expenses in Q2.2021 capex in the first half of the year and expect to spend in the third quarter are tracking below our projection projected financials for 2021.

We understand is due to a delayed start to our factory build out how.

However, we expect that capital spend or that under spend.

Just shift to 2022 early 2024.

Finally, I want to highlight.

Our updated risk factors in our forthcoming 10-Q for the second quarter.

The merging of Astra and holistic included two sets of risk factors and after an in depth review, we are including a comprehensive list of risk factors for new Astro.

As we transition from a pre revenue company to regular commercial launch it we plan to offer a more detailed outlook regarding revenue and spend in the quarters to come.

With that I'll turn the call back to Chris.

Thanks Kelly.

Commencement of commercial launch services is an important milestone for Astro our design manufacturing and software engineers are focused on identifying efficiencies, but are not only reducing costs, but.

<unk> performance and reliability of our services.

Talented team and many decisions along this path and we're optimistic.

Limited data, but we will make mistakes along the way.

Knowing that our strategy to continue to make the next launch better as we believe rapid iteration is our key differentiator versus other large providers.

Starting on August 27.

When our mantra.

We will initiate the launch of Lv zero aerospace and live streaming events on our web site, that's correct Tom.

Look forward to updating you on our subsequent launches later this year in line with our core belief in the value of March learn and repeat with that let's open the call for questions.

Hello, Ladies and gentlemen, if you have a question or a comment at this time. Please press. The Star then the one key on your Touchtone telephone. Mr. Question has been answered or you assume with yourself from the queue. Please press the balance sheet.

Our first question comes from Edison Chu with Deutsche Bank.

Thank you and congratulations on the income.

Public in the first quarter at the gate.

Had some questions on some strategic.

Some operational and maybe just maybe get a financial one.

On the upcoming launch first.

First the commercial one could you maybe go through what still needs to get done operationally.

Ahead of that time in the next two to three or four weeks and can you provide maybe any more details on the on the payload for the space for us.

I think that as we shift our rocket up to Kodiak and it will be riding along with the high loss system on Monday of next week. So the team will be poised to Kodiak.

The launch of <unk> and.

Transport the rocket out to our spaceport.

The specific the specific assay for complex.

This is a pretty routine thing we've done this with each of our launches. So we set up the launcher and theres.

There is a white dress rehearsal, where the rocket is loaded with the balance and we check everything out to make sure that level damaged in shipping and then we go into the launch which window opens on the 27, we've got a pretty long loss will note because that we've had.

Things like boats, and other things or interfere with launch operation.

We want to make sure that with the team up there and we're able to launch it in that window.

The payload is a test payload that.

It will be.

We ended up in the payload Bay from the space Force and it's really there to.

Testy when local environments. So that when we do our next loss with the space force don't be able to predict the impact on their satellites.

Got it.

Wanted to shift to some of the wins that you've announced so for the the other space Force.

In our multi contract OSP before.

Could you maybe describe or could you maybe go over what kind of potential contribution.

Whether it's revenue or backlog contribution from this from my understanding.

Basically there are several other competing rocket launch companies involved.

So just how does how do we think about that in terms of the impact in either the backlog or the.

Pipeline.

Thanks, Yes. So we are now able to compete for about a $1 billion of launch opportunities over the next five years with <unk>.

We are as you mentioned one of several companies before being rewarded this we couldnt compete for any of that business. So while none of that potential billion dollar of large opportunities in our backlog today I will add is as task orders and as opportunities emerge to serve.

The space force and on the Doj. So it really just opens up a bunch of additional Tam that was totally close to us prior to being included enhanced support contract.

Understood is there anything sort of.

Do you have any sort of initial expectations on what you could possibly win.

Obviously theres a lot of other players.

Any kind of initial thoughts about what is kind of a winnable.

And that of the 'twenty, but is the 18 or 20 missions.

Well I think we've we've as you've seen some pretty exciting contracts with NASA back to back end.

We hope that there will be many opportunities to serve this space for us under that contract and it's too early to say until we start to have the opportunity to.

But in.

First one of these opportunities.

And we'll start getting some of the task orders to be issued under that contract but.

And it's hard to say there is.

There continues to be a lot of opportunities for small satellite payloads coming out of the Vod and this vehicle now allow that astral and participate in that delivering those effects.

Yeah.

Got you and just one last one from me and I'll jump back in the queue.

The spire contract.

Any more details you could provide there.

I think yes.

Is it just one launch.

Anything about how heavy that payload could be.

Going up next year.

It wasn't intended to give the spire space craft that had been launched on some of our competitors and we're now going to be helping them to get the existing base profit they have in this space.

It will be four launches beginning in the spring of next year and I think the contract provides some flexibility for us to be more and more launch, but what we announced today was that we're going to kick things off early next year.

With the launch of one other spacecraft.

Okay.

Great. Thanks, Thanks for the insights.

Our next question comes from Pete's Kubicki with Elbit global.

Hey, good afternoon, guys and echo the sentiment congratulations on being a public company.

I guess, Chris to start off if we assume the first rocket three three flight is successful.

Relatively soon would you expect to be able to do maybe one per month the balance of this year in terms of additional launches or is that contingent on other factors.

While we remain on plan to.

In our targeted doing a total of three launches. This year are the exact dates of the launches.

Are not locked in so whether it'll be exactly 30 days apart or not.

When we get to win the range and when we can kind of get up the formal launches, but what I can say is there.

The rockets are being produced now theyre coming together on a production line and we are scheduled to launch.

This this rocket and two more before the end of the year.

Are they both going to be $3, three or a newer rockets just curious.

We know what we I believe have also shared that our tenants to manufacture about a dozen of these.

Version three rockets and.

We.

We will be attempting to achieve this monthly loss rate.

In the fourth quarter. This year, so starting to launch at a monthly cadence remains the plan.

Okay, Okay got it.

Next question I was wondering just kind of.

You guys with the rates that you are foreseeing, how do you kind of judge that youre, gaining the necessary regulatory approvals to hit these higher higher rates, especially kind of if you could maybe like the back half of 2022, how much of a challenge do you think it's going to be to to get the necessary regulatory approvals even now.

Just national approvals, but local approvals you mentioned, even even things like boat issues around Kodiak could you kind of walk us through your <unk>.

Land with that regard.

It wasn't really a couple of parts of that.

One is in our.

Our most recent launches because of the rockets or.

Really similar.

They are increasingly becoming batched and our licenses that we can launch several.

On a single license will be moving to working with the FAA to secure a large operators license, which will allow us to as long as there is no material change to the rocket or the state or perform a number of launches under the same launch license and then the second part to your question is our team.

It remains.

Very focused on working to.

Establish several more states sports and.

Sure.

We're working hard.

Both here in United States and abroad to identify and secure and work through the regulatory process or.

A number of additional government and commercial private international and in the future of Ocean based based platforms, which will give us a tremendous amount of flexibility.

We'll need more of a support daily based delivery model, we have in 2005.

I see okay. That's great color I appreciate it one last one for me.

I'm intrigued about this whole kind of rideshare versus direct or kind of.

Debating, let's call it maybe and you see Spacex continuing to get rideshare missions on the other hand.

Both planet inspire kind of lining up with you as well. So my question is would you say you know with regard to planet inspire.

They're kind of opening the door for you and should you be successful on some of your initial launches with them that could lead to much larger.

Opportunities with those guys is that a fair way to characterize it.

Well I think that if a large rocket happens to be going.

Lastly, where you want to go exactly when you want to get there, it's kind of like get the necessary Europe.

A large triple seven happens to be leaving it's great, but all of our customers value how quickly they can deploy in a particular asset.

And also exactly where they want to go.

I think guidance.

If you if you put the value of the time and essentially the services that they are able to provide to their customers into perspective.

<unk> actually very affordable because you're not waiting for six months either for a launch we're waiting for six months once youre already in space to get to the exact orbit or our attitude.

You need to be to perform a service for your for your end users. So I think our customers are smart and they looked at the total economic cost of <unk>.

These these larger launches in <unk>.

And I think that really explains why we continue to win contracts.

Fair enough I appreciate the color thanks, guys.

Thank you again, ladies and gentlemen, if you have a question or a comment at this time. Please press Star then the one key on your Touchtone telephone.

Our next question comes from <unk> with Roth capital.

Hi, Chris Hi, Carolina, Congratulations on completing the merger becoming public.

I just wanted to in the prepared remarks, you talked about the metrics I just wanted to quick checking that the backlog of launch is 50% of contract revenue one five okay.

One 3 billion I wanted to check if that was all similar to what you had said previously if they think incremental there and if not which what frequency would you be updating that metric just we can understand going forward.

I think I will.

I'll take it and then ill pass it back over to transplant.

I think about coming in that industry.

<unk> indicated that we have about 150.

And contracted revenue our pipeline continues to grow our backlog continues to grow but as we look forward.

We will be thinking about what we wanted to disclose it when we wanted to disclose and so what I can tell you backlog is growing and so is the pipeline.

Okay Cowen. Thank you very helpful and then.

Looking at the kind of customers kind of elaborating on the last caller's questions a customer like planners spire, how should we think Chris about how astra's business versus other competitors business with them might breakout would it be by something like payload size I would just be diversification of risk or would they be alternate and just give us a sense maybe of how you might pick.

Sure those customers, giving out their business or perhaps all of its available to you.

Can you provide your model maybe it can shift over to.

Any thoughts there would be helpful.

Yes, I think when you look at the payload.

From the customers we have announced.

We can fly we can fly all of their payloads.

But I don't think any customer wants to be in a position where they're dependent on any one large service provider.

That's a start up or even a large mega constellations. What we're hearing is as customers. They don't get locked in to a single provider. They want to have two or even three different providers launches are often delayed and in particular large launch vehicles.

<unk> really delayed because of factors that are beyond the control unit loss provider themselves. There's a delay to the large spacecraft that is the primary customer for that at rideshare I can often delay.

Dozens of small companies that are trying to develop new capabilities faster.

<unk> ability to own your outcome.

We're worried about.

To put it.

<unk> tailored exactly where it needs to go on an exact schedule and customers value that so I think we.

We'll continue to our goal is to try to do that and then do it again and again and again and really establish credibility with our customers.

And I think that will just make it easier for us to win business in the future guidance.

Got it.

Okay. That's very helpful color. Thank you and my last question really is around the acquisition did Apollo Apollo up usually I know, it's only been a few breaks even perhaps they have acquired but I'm curious if the customer conversations have started morphing a bit given that you have this capability, whereas you didn't have before I'm curious any any changes there and how the customers are approaching you. Thanks.

Yes, good question.

I would say that the conversations we're having with customers are deeper and more strategic than they ever have been before.

This this technology is a critical component in many of the large mega population. So it gives us a new <unk>.

Opportunity to serve our customers and of course as a new capability for our own system that will allow us to.

<unk> payloads on to places, we can never reached before again, increasing our Tam considerably.

Okay. Thanks, again, congratulations to you and the team.

Yeah.

Our next question comes from Austin, <unk> with Canaccord.

Hi, guys good afternoon.

Yes.

Yeah.

Just a quick question here.

Obviously, you guys have a good amount of cash from our balance sheet now and so I'm just thinking following the Apollo fusion acquisition.

Is there an interest here in <unk>.

Conducting future M&A to further diversify the business, obviously, we look at competitors like Firefly, they're branching out into.

Luna lenders in the space transfer vehicles and other platforms and rocket lab is of course working on there they're photon satellite bus platform. So is there and then.

Intend to do some M&A activity may be here in the near future.

Expand the product offerings.

Yes.

That's a great question.

We see we.

We see the opportunity.

With being a public company as a way to accelerate our business plan as well.

Where there are core technologies that will make our products better and some dimension.

Lower costs.

More efficient to operate.

Higher performance, we had a choice you can either hire people and develop that capability.

Can essentially licensed technology.

Can buy those components, which almost never the right thing to do because it's very expensive to buy things from this aerospace supply chain.

Or we can make acquisitions.

And I think that we look at each of those are very very carefully and in some cases youll.

Youll see us.

You acquire companies in some cases youll see us hire people in some cases youll see as licensing and I think that's what we're here to do and lot of expand but focus and we have we have a huge backlog we have a lot of customers that rely on us to increase our launch right and so our focus with this capital and the.

We will need to consider.

Consider transactions like this will be to accelerate revenue not expand what we're.

Offering.

Yeah.

Okay, great. Thank you for the color.

Okay.

And I'm not showing any further questions at this time I'd like to turn the call back to Chris <unk> for any closing remarks.

Yes, no I really appreciate everyone's participation today and we're really excited to have this new forum to share what we're working on with you all and look forward to.

An exciting quarter ahead and.

Getting back together with you all next quarter.

Participation SEC and see all of the near future.

Okay.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Okay.

[music].

Good afternoon, I wanted to ask for a second quarter 2021 earnings conference call. Joining us today are astra's, founder Chairman and CEO, Chris <unk>, CFO, Kevin Brendan and Vice President of compliance and Deputy General Counsel, Michael Stitcher at this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question during the <unk>.

You need to press star one on your telephone if you require any further assistance. Please press star Zero I would now like to turn the call over to Michael for introductory remarks. Please go ahead.

Okay.

Thank you operator, good afternoon, everyone. Thank you for joining us for ASP in the second quarter of 2021 earnings call. After the market closed we released our financial results. The earnings release is available.

On the SEC website, and our Investor Relations website at Investor Dod Astro Dot Com, where you can also find a link to our Investor presentation. This conference is also being broadcast over the internet and will be archived and available on our Investor Relations website.

During our call today, we will reference non-GAAP financial measures, which we believe to be useful to investors as our management team uses these non-GAAP financial measure to plan monitor and evaluate our financial performance. These non-GAAP financial measures exclude certain items and should not be considered a substitute for comparable GAAP financial measures.

Astra's method of computing, the non-GAAP financial metrics may differ from similar non-GAAP financial measures used by other companies.

A description of these items along with a reconciliation of our non-GAAP financial measures to their most comparable GAAP financial measures can be found in our earnings release. Today's call will also contain forward looking statements that refer to future events, including <unk> future financial outlook when used in this call.

Anticipate could enable estimate intend.

And expect believe potential will should project and similar expressions as they relate to <unk> are as such a forward looking statements. These forward looking statements are subject to a number of risks and uncertainties and as a result, astra's actual future results and performance may differ materially.

We really from those discussed in this call.

We encourage you to review our filings with the SEC, which we described the factors that could cause actual results to differ materially.

Current expectations.

We also refer to commercial launches in this press release, when we use the phrase commercial launch commercial revenue launch or commercial orbital watch media launch conducted under an FAA commercial watch license.

Additionally, each of our launch vehicles noted by an asset title with the abbreviation of Lv standing in for launch vehicle followed by the serial number for instance, our current launch vehicle as referenced at.

Zero Zero Europe six.

Thanks, Michael and good afternoon, everyone and thank you for joining US today welcome to our first earnings call as a public company.

Key <unk> Creek.

The end of our second quarter on slide eight with the completion of our merger transaction with beauty, which generated $454 million of net cash proceeds.

And our continued development and market, our Astro trading on the NASDAQ exchange under the ticker.

<unk> PR on July 30.

Both of these events are major milestones in our mission to improve by Hutter from space.

Another important milestone for our upcoming launch.

<unk>.

Lastly.

Our first commercial launch in the first launch of our upgraded three three versus rocket, which I'll discuss later the space Force launched land during the Windows in August 2007, and will be opened through September 11th.

And we'll ask the ability to deliver a payload to precise orbit.

This is a huge opportunity for us in the first of several launches aimed at validating their low cost mobile and response launch services all of us at Astro.

Aerospace.

I want to spend a few minutes discussing after admission deliver rapid low cost asset base.

Now I'll share some highlights from our second quarter I will provide more detail on our current and future areas of focus later calendar will walk you through the financial highlights second quarter.

Move on to slide four.

For those of you who are new to gastric story for us.

A brief background.

Out of London, My co founder of nine years and is there any difficulty.

We access and.

Working with them I see NASA DARPA, another leading technology organizations.

We were lucky enough to cross paths and share a common view on premium innovation.

Namely the inefficiency of the prior 50 years is directly attributed to the approach of legacy Aerospace companies Big rocket 93 people or very expensive satellite.

By inefficient supply chain and underwritten by deep pocketed governments, there was little incentive entity.

We believe that based industry is ripe for technology innovation.

Today based on R&D is gaining traction with new low reported.

Italy, which has rapidly become smaller cheaper and more numerous and legacy satellites. The challenge of the launch vehicle is not involved in St. Louis.

Gross profit remained focused on physical sites.

And the level of reliability necessary to carry out human space flight missions and deliver large communication satellite so geostationary orbit.

Thousands of miles from our <unk>.

As a result, we mostly existing launched it was too large too expensive too and recently launched and additionally, we pump it needs to be emerging as an industry.

Please turn to slide five.

We aim to solve this problem with the worlds first Matt.

<unk> produced orbital launched system.

Small launch vehicles and mobile launch infrastructure.

Despite standard shipping containers that can be rapidly deployed anywhere in the world are rocketing requires a launch site concrete AD supported equal appeal, leveraging our highly automated launch operations.

Ah Robinson, Hey look capacity.

Needs, a modern satellite operations, allowing precise and rapid placement individual satellite.

The required work we.

We believe this may Astro system, more responsive and affordable alternatives.

Thousands of Leo satellites.

For launch in the next decade.

In December 2020, we successfully launched rocket three Q2.

The attitude of 380 kilometers.

What's happened requirement line and demonstrating orbital launch capability.

Launch demonstrates oral capability and identically performing launch from Cape Canaveral for example, would've reached orbit at our target level of velocity and target obviously.

Launching from polar orbit by Kodiak, Alaska required more performance and low inflation.

We considered making only small changes in finding yet given how well the rest of the system performed we decided to complete the remaining upgrades.

Inland capacity and transition the launch vehicle production.

Highlights are upgrades include stretching the first stage is to increase the capacity.

Reducing the math the upper stage.

Yes, there are more data environments and consolidating over a dozen individuals aged.

As with premium number.

The only changes to a complex system like Iraq always involves risks.

We appreciate that but also believe that maximizing our learning requires us to make advances and take appropriate okay with.

With rocket.

Launch right at the entire system.

So we carefully evaluated all of our changes.

The biggest component and system testing and shifts Lv Euro six.

React with the upcoming launch of a year.

As we move forward to a more regular launched a astra's fortunate to have customers investors and team members with the grid to endure the risks inherent in the development of new launch system, because they understand the importance of low cost access to space.

At nearly five years hard work incredible word this strategy has allowed us to reach the milestone of our first commercial orbital launched less than half the time of our peers.

While we are the crowd launch company to restate and demonstrating our whole capability.

Acknowledge that we must continue to be relentless in our development and rigorous in our testing to maximize the probability of success each new version of our system.

Even if we did not guarantee.

We accept the challenge and regardless of the outcome of our upcoming launch we have additional rocket on the production line and remain on plan to complete these launches before the end of the year.

<unk> Europe.

<unk> LD Europe Europe, eight currently taking shape in our factory.

Please turn to slide six.

Turning to market demand excitement about a new wave of small satellites, and Leah and well capitalized constellation customer.

<unk> strong demand the launch services.

Customer indications of launch need suggest the demand is years away from being fulfilled our differentiated low cost rapid launch strategy combined with our demonstrated launched F. 'twenty.

Abstract and that the backlog of over 50 launches representing over $150 million of contracted revenue.

We disclosed in our February merger announcements.

Earlier this year, we announced our second NASA contract Traffics.

It is a thorough bidding process versus other major launch service company.

The prelaunch contract to rapidly deploy a global satellite operation.

Our comparable type firms.

Highlights the benefit of astra's approach to responses small launch. This was after second NASA win in a row. After recruiting the last two submission contract in December of last year.

All of the NASA wins, we announced the launch agreement with Planet Labs.

We expect to be in multi launch mission to planet.

Starting in 2022 to further its position as the leading provider of global satellite imagery and geospatial solutions.

And earlier this week, we announced after was awarded for Mill services program with peak or contracts from a rebate system launched program the space Force.

This positions us to compete breath of ILUVIEN launched services over the next nine years. We also now launched contract expired today.

NASA planet Spaceports inspire when our objected edited and third our technical capability and the cost efficient monster fits for government and commercial customers.

Sure.

Groups like them.

Turning to recent company developments.

June we announced the acquisition of Apollo infusion, our leading design and manufacturing company and some of the world's most efficient electric propulsion engines.

The purchase price per followed with $145 million.

Putting earn outs.

Im particularly pleased.

Astra amongst a handful of competitive offers.

Likely to repeat two thirds of the total consideration in astra's shares.

Testament to the vision of our joint opportunity.

All of the real differentiator for Astro customers by allowing them to move beyond Leo and medium Geo lunar orbit or maintain any orbit for a longer period of time.

Addition to pollinate Astro more virtual launch provider as well as increases our total addressable market.

The incredible team led by Mike do you want to play a key role in the development of our spacecraft platform.

Let me turn to our state of the art facilities Astral.

Astra headquarters located on the former U S Naval Air station in Alameda, California.

Just on the San Francisco Bay, 15 minutes outside of the financial District.

And currently reside more than 100000 square feet of manufacturing office launches and development space in May we began an expansion of more than 200000 square feet, which we expect to complete by the end of this year.

We'll complete our facilities total approximately 350000 square feet and up to support our long term plan producing one rocket per day.

Our facilities are a unique differentiator.

Industry.

Almost all of our competitors with transport the Rockefeller engines from the factory to remote locations to test performance.

During his years with experience at other launch companies describe a lengthy and highly inefficient process.

Engine performance by testing and remote locations are.

Our facility is unique in the industry and commitment the test engine multiple times a day every day.

This is a key enabler of our goal to constantly improve.

Moving to slide eight.

Now onto our incredible team.

All of our efforts would be possible without building on our extraordinary team.

Significant portion of my time, identifying and recruiting talented people to help us accomplish great things Astro.

Our goal more than just hiring smart people, who are building a culture that is comfortable taking on challenges and overcome.

Several high profile hires joined Astra, leading company by Apple.

<unk> Blue origin.

The unique and untried and space industry.

Adam and I take great pride in the Covid Aster grit and determination.

During the second quarter, we added 62, new employees and ended the quarter with 188 total employees. Most of these additions are in areas of design and engineering software to keep us in the past David watches.

Thanks.

We made several important strategic additions to our board in the past couple of months, we're thrilled to welcome our newest board members.

The shelf bornite and Lisa Nelson.

Yesterday and earlier today.

Michelle Lisa joined current independent Board Directors, Mike Leven, and Craig recall, both of whom joined in June and our long term director and a trusted vendor Scott Stanford for equity capital, who served as our lead independent director.

Few words about our board members.

We saw 49.

Secretary of Defense strategy under President Bill Clinton and under Secretary of Defense for policy under President Obama. She is widely respected as a strategic advisor.

Periods of the defense industry.

You can also spent 14 years at Microsoft in various executive positions were Cofounded, Microsoft venture group and swap.

And accomplished executive with global Finance and business development history of Baidu, serving on boards of number of companies. Mike Lehman has extensive CFO and general finance experience from innovative and highly successful technology companies, such as Arista networks, Palo Alto networks and Sun Microsystems.

Finally, <unk> chairman and CEO of the river, which is focused on strategic investments in the telecommunications industry credit and a successful entrepreneur starting to built many companies with eagle cellular and broadband industry, including the top value.

After extremely working to have this group of talented knowledgeable and passionate advisors to help us navigate execute our vertical in this emerging space SEC industry.

Now I would like to turn the call over to our CFO Helen granted to discuss our second quarter results.

Thank you Chris and.

And good afternoon, everyone as Chris noted, our second quarter results for steady and solid and we continue moving from primarily development driven company to a production focus.

On June 30, we completed our merger with policy this transaction, including the pipe transaction led by Blackrock provided Astro $464 million of cash proceeds and offers US a solid foundation as we progress through our plan of reaching a daily launch cadence.

These cash proceeds net of certain onetime expenses related to underwriting legal accounting and other fees.

Earlier this week, we filed our amended form S. One registration statement with the SEC.

In connection with that filing we registered the resale of shares issued through our pipe investors certain of our affiliates and the holistic sponsor and the business combination.

We also registered the shares issuable pursuant to the public and private warrants that were issued prior to the <unk> and the shares issued and issuable pursuant to our Apollo fusion transaction we.

We have not yet met the requirements to do a mandatory redemption of the outstanding public warrants and as a result, we have not decided whether we will redeem the warrants if we meet such requirements.

As Chris mentioned in his remarks, we plan to launch our first commercial commercial test payload.

For space Force as the window opens between August 27 through September 11th.

Contracts, we have with the space Force also includes a second launch that we expect to occur later this year.

We ended the quarter with cash cash equivalents and restricted cash of $452.4 million.

We did not generate any revenue during the second quarter.

Q2, 2021, adjusted net loss was $23.1 million.

And $31.3 million on a GAAP basis.

Adjusted EBITDA was a loss of $21.4 million for the quarter.

Capital expenditures totaled $8.5 million in the second quarter comprised primarily of the expansion of our Alameda headquarters.

And investments in manufacturing equipment.

Next I'll provide an outlook for our third quarter ending September 32021.

We currently expect adjusted EBITDA to be a loss between approximately $32 million and $35 million.

Depreciation and amortization to be between 1 billion and $1.3 million.

Stock based compensation to be between $6 million and $10 million.

Cash taxes are forecasted to be zero.

Basic shares outstanding to be between $255 million and $260 million and capital expenditures to be between 10 million and $15 million.

Let me provide a bit more context on our expected spend for Q3.2021.

Third quarter operating expenses are tracking ahead of our projected financials and will be up sequentially from Q2.2021.

The increase is due to our broader investment in our product roadmap program execution and operational capacity as we look to expand opportunities and our operational model. In addition, we accelerated head count and our back office functions to strengthen our ability to support the business and the <unk>.

Operator, as a public company.

Offsetting the increase in operating expenses in Q2.2021 capex in the first half of the year and expect to spend in the third quarter are tracking below our projection projected financials for 2021.

They understand is due to a delayed start to our factory build out however, we expect that capital spend or that under spend.

Shift to 2022 early 2024.

Finally, I want to highlight.

Our updated risk factors in our forthcoming 10-Q for the second quarter.

The merging of Astra and holistic included two sets of risk factors and after an in depth review, we are including a comprehensive list of risk factors for new Astro.

As we transition from a pre revenue company to regular commercial launch it we plan to offer a more detailed outlook regarding revenue and spend in the quarters to come.

With that I'll turn the call back to Chris.

Thanks Kelly.

<unk> performance and reliability of our services.

Talented team and many decisions along this path and we're optimistic.

Domestic but we will make mistakes along the way.

Knowing that our strategy to continue to make the next launch better as we believe rapid iteration is our key differentiator versus other launch providers.

Starting on August 27.

When our launch window.

We will initiate the launch of Lv zero aerospace and live streaming events on our website after that comp.

Look forward to updating you on our subsequent launches later this year in line with our core belief in the value of launch learn and repeat with that let's open the call for questions.

Our first question comes from Edison Chu with Deutsche Bank.

Thank you and congratulations on the <unk>.

Public and in the first quarter of the gate.

Had some questions some strategic.

Some operational and maybe if you can get a financial one.

On the upcoming launch first.

First a commercial one could you maybe go through what still needs to get done operationally ahead of that time in the next two to three or four weeks and can you provide maybe any more details on the on the payload for the space for us.

I think that as we shift our rocket up to Kodiak will be riding along with Boeing high losses form on Monday of next week. So the team will be poised to Kodiak.

The launch of <unk>.

And.

Transport the rocket out to our state court at the specifics for complex.

This is a pretty routine date, we promise with each of our launches. So we set up the long term.

There is a workhorse of our software the rocket is loaded with Alex and we check everything out to make sure that was damaged in shipping and then we go into the launch which window opens on the 27, we've got a pretty long loss reserve because that we've had.

Things like Boeing and other things interfere with launch operations.

We want to make sure that with the team up there we're able to launch it in that window.

The payload is a test payload that.

We will be.

We ended up in the annual form a base for us and it's really there to.

Yes.

Local environments.

When we do our net loss for the space Force those gambles, we predict the impact on there.

Yeah.

Got it.

I wanted to shift to some of the wins that you've announced so for the the other space Force.

<unk> contract OSB before.

Could you maybe describe or could you maybe go over what kind of potential contribution.

Whether it's revenue or backlog contribution from this from my understanding.

Basically there are several other competing rocket launch companies involved.

So just how do we how do we think about that in terms of the impact in either the backlog or the.

Pipeline.

Thanks, Yes. So we are now able to compete for about a $1 billion of launch opportunities over the next five years with <unk>.

We are as you mentioned one of several companies before you in rewarded this we couldnt compete for any of that business. So while none of that potential billion dollar of large opportunities in our backlog today I will add is as task orders and as opportunities emerge to serve.

At this stage for us.

So it really just opened up a bunch of additional Tam that was totally closed to us prior to being included enhanced before Congress.

Understood and is there any sort of.

Do you have any sort of initial expectations on what you could possibly win obviously theres a lot of other players.

Any kind of initial thoughts about what is kind of winnable.

And that of the 12%, but is the 18 or 20 patients.

Well.

We've as you've seen some pretty exciting contracts with NASA back to back and.

We hope that there will be many opportunities to serve the space force under that contract I think it's too early to say until we start to have the opportunity to.

Put in.

For some of these opportunities.

And we'll start getting some of the task orders to be issued under that contract but.

So I'd say there is.

There continues to be a lot of opportunities for small satellite payloads coming out of the Vod and this vehicle now allow that astral and participate in that delivering the space.

Okay.

Got you and just one last one for me and I'll jump back in the queue.

The spire contract.

Any more details you could provide there.

I think yes.

Is it just one launch.

Anything about how heavy that payload could be.

Going up next year.

Yes.

If the spire spacecraft that had been launched on some of our competitors and we're now going to be helping them get existing base profit they have in the space.

It will be more launches beginning in the spring of next year and I think the contracts provide some flexibility for Q1, the whole launch of what we announced today was that we're going to kick things off early next year.

With the launch of wider spaced pad.

Yeah.

Great. Thanks, Thanks for the insights.

Our next question comes from Pete <unk> with Elbit Global.

Hey, good afternoon, guys and echo that sentiment congratulations on being a public company.

I guess, Chris to start off if we assume the first rocket three three flight is successful.

Relatively soon would you expect to be able to do maybe one per month the balance of this year in terms of additional launches or is that contingent on other factors.

While we remain on plan to.

In our targeted doing a total of three launches this year the exact dates of the launches.

Are not loss.

Opt in so whether there'll be exactly 30 days apart or not.

We have yet to win a range and when we can kind of get up the formal launches, but all I can say is there.

The rockets are being produced now they're coming together on a production line and we are scheduled to launch.

This this rocket and two more before the end of the year.

Are they both can be three three or a newer rockets just curious.

We know that we I believe have also shared that are intended to manufacture about a dozen of these.

Version, two rockets and.

We.

We will be attempting to achieve this monthly loss rate.

In the fourth quarter. This year, so starting to launch at a monthly cadence remains.

Okay, Okay got it.

Next question I'm wondering just kind of.

Maybe like the back half of 2022, how much of a challenge do you think it's going to be to to get the necessary regulatory approvals, even not just national approvals, but local approvals you mentioned, even even things like boat issues around Kodiak could you kind of walk us through your plans with that regard.

A couple of parts of that part one is in our most recent launches because of the rocket share.

Really similar.

They are increasingly becoming batched and our licenses. So we can march several.

On a single license will be moving to working with the FAA to secure a lot of operators license, which will allow us to as long as there is no material change rocket four at this stage four.

Form a number of launches under the same launch license.

And the second part to your question our team remains.

Very focused on working to.

Stablish several more states.

And.

We are working hard both here in United States and abroad to identify and secure and work through the regulatory process.

Sure.

A number of additional government commercial private.

International and <unk>.

The future of Ocean based 80 platforms, which will give us a tremendous amount of flexibility.

We will need more of a support days basically recall that we havent hosted by.

Okay. That's great color I appreciate it one last one for me.

I'm intrigued about this whole kind of rideshare versus direct to orbit kind of.

Debating, let's call it maybe and you see Spacex continuing to get Rideshare mentioned on the other hand.

Both planet inspire kind of lining up with you as well. So my question is would you say you know with regard to planet inspire.

They're kind of opening the door for you and should you be successful on some of your initial launches with them that could lead to much larger.

Opportunities with those guys is that a fair way to characterize it.

Well I think that if a large rocket happens to be going exactly where you want to go exactly when you want to get there it's kind of like the ferry Europe.

A large triple $7 happens to be leaving.

Leaving it's great, but all of our customers value how quickly they can deploy in a particular asset.

And also exactly where they want to GAAP.

I think that.

If you can put the value of the time and essentially the services that they are able to provide generic customers into perspective.

There is actually very affordable because you're not waiting for six months either for a launch or waiting for.

Six months once youre already in space, it's the exact orbit or our attitude, where you need to be to perform a service for your for your end users. So I think our customers are smart and they look at the total economic cost of all of these these large launches.

I think that really explains why we continue to win contracts.

Yeah.

Fair enough I appreciate the color thanks, guys.

Thank you again, ladies and gentlemen, if you have a question or a comment at this time. Please press. The Star then the one key on your Touchtone telephone.

Our next question comes from <unk> <unk> with Roth capital.

Hi, Chris Hi, Caroline and congratulations on completing the merger and becoming public.

I just wanted to in the prepared remarks, you talked about metrics I just wanted to check on that the backlog of launch at <unk> 50 on the contract revenue.

$100 million I wanted to check if that was all similar to what you had said previously if they think incremental there and if not which.

What frequency would you be updating that metric just we can understand going forward.

I think I'll.

I'll take it and then ill pass it back over to Chris.

If I think about coming in that initiative.

We've indicated that we have about 150.

Million income.

<unk> revenue our pipeline continues to grow our backlog continues to grow but as we look forward.

We will be thinking about what we wanted to disclose and when we want to disclose and so what I can tell you backlog is growing and so is the pipeline.

Okay, Kevin. Thank you very helpful and then.

Looking at the.

The kind of customers kind of elaborating on the last caller's questions.

Customer like planters spire, how should we think Chris about how astra's business versus other competitors business with them might breakout would it be by something like payload size that would just be diversification of risk or would they be alternate and just give us a sense maybe of how you might picture those customers, giving out their business or perhaps all of its available to you in.

If you can provide your model maybe it can shift over to any.

Any thoughts there would be helpful.

Yes, I think when you look at the payload.

From the customers we have announced.

We can fly we can fly all of their payloads, but.

But I don't think any customer wants to be in a position where they're depending on any one large service provider.

That's a start up or even a large mega calculation. What we're hearing is as customers. They only get locked in to a single provider. They want to have two or even three different providers launches are often delayed and in particular large launch vehicles.

<unk> really delayed because of factors that are beyond the control unit loss provider themselves. If there is a delay to the large spacecrafts that is the primary customer for that at rideshare I can often delay.

Dozens of small companies that are trying to develop new capabilities faster.

<unk> ability to.

One your outcome.

We're we're.

Able to.

Tailored exactly where it needs to go on an exact schedule and customers value that so I think we'll continue to our goal is to try to do that and then do it again and again and again and really.

I wish credibility with our customers.

I'll just make it easier for us to win business in the future. We are just getting started.

Okay, Chris its very helpful color. Thank you and my last question really is around the acquisition did Apollo Apollo up usually I know, it's only been a few breaks even perhaps they have acquired but I'm curious if the customer conversations have started.

<unk> a bit given that you have this capability, whereas you didn't have before I'm curious any any changes there and how the customers are approaching you.

Yes, good question.

I would say that the conversations we're having with customers are deeper and more strategic than they ever had been before.

This technology is a critical component in many of the large medical inflation, but it gives us a new.

Opportunity to serve our customers and us.

Of course, as a new capability for our own system that will allow us to.

So take payloads on to places, we could never reached before again, increasing our Tam comparatively.

Okay. Thanks, again, congratulations to you and the team.

Our next question comes from Austin, <unk> with Canaccord.

Hi, guys good afternoon.

Okay.

Just a quick question here.

Obviously, you guys have a good amount of time from a balance sheet now and so I'm just thinking following the Apollo fusion acquisition.

Is there an interest here in <unk>.

Adjusting future M&A to further diversify the business, obviously, we look at competitors like Firefly, they're branching out into <unk>.

<unk> lenders in the space transfer vehicles and other platforms and rocket lab is of course working on there they're photon satellite bus platform. So is there.

Intend to do some M&A activity may be here in the near future.

Expand the product offerings.

Yes, Tom.

Thats a great question.

We see.

We see the opportunity.

With being a public company as a way to accelerate our business plan.

Where there are core technologies that will make our products better and some dimension.

Lower costs.

More efficient to operate.

Performance, we had a choice you can either hire people and develop that capability, we can essentially licensed technology.

We can buy those components, we followed that with the right thing to do because it's very expensive.

I think from this aerospace supply chain.

Or we can make acquisitions.

I think that we look at each of those are very very carefully and in some cases youll.

Youll see us.

You've acquired companies in some cases youll see us hire people in some cases youll see as licensing and I think that's what we're here to do and want to expand but focus and we have we have a huge backlog. We have a lot of customers that are relying on us to increase our launch rates and so our focus with this capital.

It will lead to.

Consider transactions like this will be to accelerate revenue not expand.

What we're offering.

Yeah.

Okay, great. Thank you for the color.

Okay.

And I'm not showing any further questions at this time I'd like to turn the call back to Chris <unk> for any closing remarks.

Yes, so I really appreciate everyone's participation today and we're really excited to have this new forum to share what we're working on with you all and look forward to.

Citing order ahead and.

Getting back together with government this quarter.

Participations that and see all of the near future.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect and have a wonderful day.

Q2 2021 Astra Space Inc Earnings Call

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