Q4 2021 Spire Global Inc Earnings Call
Greetings.
And welcome to the spire global fourth quarter 2021 earnings call.
At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
Please note that this conference is being recorded.
I will now turn the conference over to our host Hillary Jaffe head of communications. Thank you you may begin.
Thank you Hello, everyone and thanks for joining us for our fourth quarter fiscal 2021 earnings conference call.
Our press release and SEC filings can be found on our IR website at IR Dot spire dotcom.
A replay of today's call will also be made available with me on the call today is Peter plots, our CEO and Tom Crowley CFO .
As a reminder, our commentary today will include non-GAAP items reconciliations between our GAAP and non-GAAP results as well as our guidance can be found in our earnings press release.
Some of our comments today may contain forward looking statements that are subject to risks uncertainties and assumptions in particular, our expectations around the integration of our acquisition results of operations and financial conditions are uncertain and subject to change.
Should any of these fail to materialize or should our assumptions prove to be incorrect actual company results could differ materially from these forward looking statements.
A description of these risks uncertainties and assumptions and other factors that could affect our financial results is included in our SEC filings with that let me hand, the call over to Peter.
Thank you Hillary.
Good afternoon, and thank you for joining us.
You can review our 2021 results today and discuss spires outflow for 2022 and beyond I want to convey how pleased I am with the exceptional momentum in the business and the rapidly expanding revenue opportunities in front of us.
We sit in an enviable position among public space companies, we have a fully operational diversified revenue generating business that serves nearly 600 <unk> solution customers.
During 2021 we delivered strong growth in revenue strong growth in Iraq and strong growth in our customer counts.
For 2020 , one we had $43 4 million in revenue and we ended the year with nearly $71 million of ear are representing 96% year over year growth.
Looking at our future growth, we are projecting revenue of 87 5 million at the midpoint of our 2022 guidance.
Presenting 102% year over year growth in ear off the hunter than $2 5 million all at the midpoint of our 2022 guidance. This would put us among the fastest companies to go from 1 million to over $100 million of Iraq.
All of this further validates the continued exceptional growth opportunity for spire.
Spinal systems currently monitor about 17 trillion dollars of global trade and capture the movement of the two trillion dollar aviation industry.
At least 20, a trillion dollars of global GDP are impacted by weather, which spire marches and predict globally up to 10 days out.
We have the ultimate vantage point space from which to observe analyze and predict activity on Earth day and night 24 seven.
Today about 600 are our solution customers rely on spire to achieve their missions and run their businesses. Examples include the aviation industry tracking aircraft globally to optimize fuel consumption the maritime industry optimizing ports activity the insurance industry alerting policyholders.
<unk> weather events, the financial services industry tracking commodities and monitoring wildfires to understand industrial even picked of climate change five ice governments identifying illegal RF transmissions in geopolitical hotspots or the <unk>.
<unk> energy industry, using wind and some forecast to predict power output. These are just a few among the many examples off the applications of spy is capabilities.
We believe <unk> total addressable market with the reach and I know the value in excess of $100 billion by 2025 with about 200000 potential customers.
Clearly, we have barely scratched the surface of the markets and use cases that we can serve with our data and services.
As we focus on 2022 I want to reiterate spires four growth pillars. These are the four core strategies that we will continue to execute against to drive our business growth over the next several years.
They are number one invest in sales marketing and product number two expand into new geographies and use cases.
Number three expand the capabilities of our data and our analytics and number four executing strategic acquisitions to strengthen our market positions.
Today I will briefly touch on two of these pillars and the pillar of expanding the capabilities of our data and analytics I'm excited to announce that inspire as recently demonstrated our radio signal geolocation capability in orbit.
In the aerospace and defense industry do your location technology is being used for a growing number of security purposes like dock the vessel detection in the maritime domain and GPS jamming overlapped.
<unk> has developed and demonstrated the capability to deal located in multiple bands and to detect and Geo locate GPS jamming sources in places like China, Syria, Ukraine, and other countries across the world.
We have over 40 geolocation capable satellites in orbit today, giving us an edge over other providers in this space.
Appeared to be in earlier stages of the R&D Android deployment stage.
And in Q4, we won our first significant contract leveraging this capability and multi year eight figure contract with a large defense contractor voice based services solution to detect and geo locate targeted radio signals.
We are also in discussion with several other defense contractors about this capability and are truly excited about participating in this multibillion dollar market.
The second pillar that I would like to touch upon today is expanding use cases and geographies.
We are pleased to share that in Q4, you must have upgraded their contract for Europe with us to operationally utilized our radio agitation data to enhance the weather forecasting ability.
And in addition, we recently announced that Noah has increased their purchase of spire weather data 11 fault.
Together this use of spire data in production now with public agencies to better predict the weather protecting lives and preventing the loss of property for about 1 billion people and about half of global GDP.
And I am extremely proud of this work as we continually strive to help humanity understand adapt to and mitigate the impacts of climate change with data from space.
In Q4 Spy also began working with southern launch and launched service provider headquartered in Adelaide, South Australia, providing the company with hyper local weather forecasting for the rocket launch site.
<unk> is an example of how having a point optimized forecast can help any weather dependent industry with localized or remote areas conduct business in a safe and efficient manner and.
And we are excited about our continued expansion in the Asia Pacific market.
We also won a public bid for the launch of support in Europe , the port of Rotterdam.
They are expanding their relationship with us to include the purchase of Prs data in addition to vessel characteristics.
The port has committed publicly to tracking transport emissions with the goal of moving towards carbon neutral shipping.
We are excited to be working with the port of Rotterdam to assist with increasing port efficiency and improving trade flows based on their strategic pillars of sustainability Digitization and innovation.
We see this as a fantastic showcase for the industry as more and more ports and indeed industries will follow the leadership of the port of Rotterdam.
And move towards publicly committing to its next year of operations.
And lastly in Q4, we also completed the acquisition of exact Earth and have been focused on the complete integration of the company into spine as maritime organization the.
The combined spire and former executive teams have already begun cross selling our complimentary solutions.
And the alignment with spy as values of being foster collaborative and relentless. This process is proceeding at a rapid pace and the business integration is on track to be completed within the next few weeks roughly 120 days since the closing of the transaction on November 30 of last year as it.
A reminder, this transaction hit all four of our growth pillars.
Heritage a fantastic team obtained the vast historical dataset and homestyle solutions with real time capabilities and expanded our geographical footprint.
The integrated team is excited about the growth opportunity for the combined business in 2022.
Before I turn it over to Tom who will discuss our Q4 financial results and provide an update on our Q1 and fiscal year 2020 to guidance I want to reiterate our excitement with respect to the enormous market opportunity, whose space based data and analytics in front of us spire is it.
A leader in leveraging the vantage point of space to help solve challenges here on Earth for corporations countries and communities.
We remain focused on driving rapid and continued topline growth and moving the company towards its goal of being cash flow positive in the next 24 to 30 months and.
And with that I'll turn it over to Tom.
Thanks, Peter the fourth quarter was great way to close out the year for spire Q4 revenue increased 106% year over year to $15 million, including hitting the top of our guidance at $13 5 million on an organic basis, and adding $1.5 million in revenue from exact earth.
The exact or if revenue is down 300 K from the preliminary results, we announced on January 31, 2022, due to a reduction from the treatment required by acquisition accounting.
For the full fiscal year 2021, we recognized $43 4 million in revenue, which represented organic revenue growth of 47% and total revenue growth of 52%.
Our go to market strategy delivered a strong quarter and we exceeded our AOR guidance ending the fourth quarter at $52 3 million organically.
With an additional $18 5 million of air or from the exact Earth acquisition. We ended the year at a total of $78 million of IRR.
This represented an increase of 96% year over year.
We also exceeded our guidance for organic are our solution customers at year end with 255, a 66% increase year over year.
We added an additional 343 AOR solution customers from exact Earth, which gave US a total of 598 air solution customers, 288% increase year over year.
Our combine an organic Q4 are our net retention rate was 104% in the organic last 12 months net retention rate was 110%.
As we mentioned during our last earnings call, we put a higher focus on landing new air our solution customers than on expanding our existing customer base in the second half of the year.
With so much focus on gaining new air our solution customers, we expect lower net retention rates for the first half of fiscal year 2022, but we expect as we head into the second half of fiscal year 2022 that the air our net retention rates will start to increase.
We saw strength in the fourth quarter from both maritime and space services solutions.
Maritime had a solid organic dollar growth along with adding over 300 are our solution customers from exact earth.
In 2022, we'll be focusing on targeting those are our solution customers that we added from exact earth for an expansion with the cross selling of our weather aviation and space services solutions.
Our space services business had a number of key wins, most notably the one Peter mentioned earlier from a large aerospace and national security contractor that resulted in an eight figure contract to be delivered over the next four years.
We believe that all four of our solutions offerings Maritime aviation whether in space services are still in the very early stages of penetrating their total addressable markets and we see opportunities across all customer sizes in both commercial and government as well as across industries and geographies.
Now turning to the income statement I want to note that unless otherwise stated all metrics are non-GAAP . We've provided a reconciliation to GAAP to non-GAAP financials in our earnings release that should be reviewed in conjunction with this earnings call.
Our organic gross profit exceeded guidance at $8 9 million during the fourth quarter, which represented a gross margin of 66%.
This compares to a gross margin of 44% last quarter and 66% in the year ago quarter.
As we discussed on last quarter's call. We saw improved balance between the timing of revenue and our level of investment total gross profit included a exact earth from the post acquisition period was $9 4 million, representing a gross margin of 63%.
Our organic operating loss for the fourth quarter was $12 4 million or a negative 92% operating margin, which was $1 5 million better than the midpoint of our Q4 guidance range.
This compares to a negative of 142% last quarter and negative 103% in the year ago quarter.
Total operating loss for the fourth quarter was $12 9 million or a negative 86% operating margin, including exact earth.
While we continue to make investments in our future growth, we remain focused on driving efficiencies in the business to reach profitability.
Total adjusted EBITDA in the fourth quarter was negative $10 6 million and organic adjusted EBITDA was negative $10 4 million, which was only 100 K below the top of our guidance.
Turning to the balance sheet and statement of cash flow, we ended the quarter with cash cash equivalents and restricted cash of $109 3 million after completing the exact or a transaction and paying cash to cancel the warrant agreement with the European investment Bank that was previously described in our public filings.
Before getting into our guidance numbers for first quarter and full year fiscal 2022, I want to remind everyone that all of our guidance numbers now include a full year impact of the exactly with acquisition.
Given the speed with which we are integrating the exact or with the organization, we will not be splitting out the organic and nonorganic numbers in fiscal year 2022.
For the first quarter, we expect total revenue to range between $16 5 million and $70 5 million.
The sequential increase in our Q1 'twenty two revenue reflects the incremental <unk> added during Q4 fiscal year 2021, and a full quarter of exact earth offset by approximately 1.8 million lower non subscription based revenue in Q4 of fiscal year 2021.
We expect Q1, ending AOR to range between $85 million and $81 5 million, which at the midpoint represents a $10.2 million or 15% quarter over quarter sequential growth from Q4 a R.
We expect our AOR solution customers guidance to range between 620 and 630.
We expect non-GAAP operating loss for Q1 to range between $15 8 million to $14 8 million.
Our non-GAAP operating loss guidance reflects the timing of Q1 project based revenue increased hiring to support our rapid growth and additional costs related to our being a public company.
We expect adjusted EBITDA to range from negative $12 5 million to negative $11 5 million and we expect our non-GAAP loss per share for Q1 to range from negative 14 cents negative 13 cents, which assumes a basic weighted average share count of approximately $139 1 million shares.
Now turning to the outlook for the full fiscal year. Our total revenue is expected to range between $85 million and $90 million, representing a 102% year over year growth at the midpoint.
We expect year, ending <unk> to range between $100 million and $105 million and estimate that we will add over 120 <unk> solution customers for a total to range between 720 and 740.
We expect non-GAAP operating loss for the full fiscal year to range between $48 3 million to $43 3 million, which represents a negative 52% non-GAAP operating margin at the midpoint of guidance for both non-GAAP operating loss in revenue.
This compares to a non-GAAP operating margin of negative 105% for the full fiscal year 2021.
We're seeing good progress in driving efficiencies and improving margins, while also balancing the proper investment needed to support our four growth pillars.
We expect adjusted EBITDA to range from negative $34 million to negative $29 million.
non-GAAP loss per share for the full fiscal year is expected to range from between negative 44 cents to negative 41 cents and assumes a basic weighted average share count of approximately $139 4 million shares.
We expect to end fiscal year, 2022, with greater than $40 million in cash.
And while that should be sufficient cash to drive our four growth pillars and achieve future profitability. We are in active discussions for an expanded credit facility to add cash to our balance sheet.
In closing, we are very happy with our strong momentum exiting the fourth quarter and the strong growth trajectory that we see for the coming year.
We are well positioned to achieve our 2022 targets and continue on our path towards profitability.
Thanks for joining us today and with that I'd like to open up the call to questions.
Thank you.
And at this time, we will conduct a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
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Thank you before we go to the queue on the line, we're going to take the first question from the Sei technologies platform.
Where do you see the biggest growth opportunities in the future here.
Sure.
We see tremendous growth in all of our data and services business and just sheer dollar deployed capability for RMG location. Another multibillion dollar total addressable market, but yeah, but there are two areas that I personally and.
I'm, particularly excited about you know one is helping other companies this ecosystem.
That one too rapidly and reliably leveraged space to solve problems on the earth by being their infrastructure backbone in space.
Aspired literally makes launching a business leveraging space as easy as integrating an API.
Truly unrivaled scale here now we've got over 300 years of accumulative. They keep space experience 30 launch campaigns 10 different launch provided 70 ground stations. Some tenants tens of thousands of satellites account contacts and mountain terabytes of data process and ship to hundreds of customers every single day.
So we really bring this tremendous scale to bear.
So leveraging spy as infrastructure space is literally just like using Amazon AWS for your cloud computing needs. It just works reliably and with speed.
And the other area that I'm really excited about as you know investing more in telling our story to increased engagement with the investor community videos presentations, one on one meetings social media interactions and we.
Do tend to have that almost maniacal focus on building a business in solving our customers' problems and we also need to do more to share our story and engage with the community about the impact that spire solutions have on our customers and the communities and I'm really excited.
About that growth opportunity as well.
Thank you.
And our first question from the phone comes from Jeff Mueller with Robert W. Baird. Please state your question.
Yeah. Thank you lots of nice Gwen wanted to ask about the no. One specifically so is this.
$8 million contract for 10 months.
<unk> is there anything kind of one time.
In there or is it possible that it kind of renews at that run rate.
Okay.
It is a pure data subscription.
There's nothing onetime in there it is operationally using our data to improve weather prediction.
Which then service.
All of the United States community in a much broader community globally as well that that can take advantage of that.
This is substantially increased data amount theyre purchasing about 11 times the amount of data from us than they used to.
And.
<unk>.
I can't speak about.
What is going to happen in the future of course, but it is a classic straightforward subscription no. One time thing and it's it's really breaking open and showcasing this GPS radio quotation market wide open.
As we always have thoughts that the public sector will do the same thing in weather data as it has done in other space services like telecommunication imagery of launch leveraging the private sector to provide the service.
That's great.
The excitement for stay services, but it seems to be you're also doing really well and whether do you view all row as is it complementary to radar equipped satellites and as radio radar satellites is that an opportunity for you or a competitive threat.
It is both.
The data sets are extremely complementary.
And we are like really really happy with the technology that you have already in service really being a leader globally. The only one which has managed to make its data available to a global community and not just the local community.
The radio quotation data, we have already expanded into data, which is not the temperature and pressure and moisture, but it's all of the data around soil moisture.
Surface wind speeds.
We always are working too it's data that is rain content and we have laid out data that is microwave soundings now the data that you mentioned is a very complementary data source and.
We look forward to having those data sources, both available to the global community as well as in our own repertoire.
Excellent. Thank you congrats.
Thank you.
Our next.
She comes from Erik Rasmussen with Stifel. Please state your question.
Yeah, Thanks for taking the questions.
Maybe just a more relevant and topical with the current geopolitical environment and increased emphasis on defense and defense spending.
Are you hearing from your customers and what does that mean for improved opportunities that maybe you were previously expecting.
Obviously, Mike.
Relay.
Really into sort of the new hire you have for.
On the sales side.
I'm going to talk a little bit about the future outlook that we see each year.
And Tom can maybe talk a little bit about our existing business mix.
I mean, it is with data and insights from space that truth, and transparency can be shed on globally challenging situations, including a conflict that indeed, we have been witnessing firsthand.
And it has really brought to the forefront.
Powerful role that commercial companies like spire 10, and are playing in this new era of space being relevant to all sorts of global challenges, including defense and security related work.
Aspire has a balanced business there.
Indeed.
Thank the awareness that the current very tragic and 10.
10 situation brings.
Yeah.
Is positive for companies that can bring very very unique capabilities to bear.
I mentioned earlier on the call our geolocation capability.
Where we have demonstrated for example, the pinpointing of GPS jamming.
Something that is happening and has been happening on that on a regular basis.
<unk> has more than by others and so indeed.
The <unk> space.
<unk> continues to expand and continues to grow it's a bit hard to say if it grows faster than other opportunity sets because indeed, we see growing demand in all of our <unk>.
And just to give you a little bit of numbers behind the how the business that was split between government and commercial we see a nice healthy mix of almost a 50 50 split them. The exact numbers for 2021 revenue was 56 government 44, commercial but again it does show that healthy mix, which means our four solutions.
You know, we're solving use cases across both platforms in areas and then obviously that gives us a higher access to the Tam when we're covering ground on both areas.
Great. Thanks, and maybe just unpacking the 2022 guidance.
How confident are you hitting revenue NAR are the targets that you gave and I guess I'm just trying to sort of reconcile the inherent risk in your business and the challenges in both the timing of customer contract signings and also possible launch delays like we saw in 2021.
And then with that do you feel like you have the sales team in place to deliver on that 2022 guidance. Thanks, Yeah. Let me let me start on the one of our growth pillars is investing in sales and marketing and product.
And just like our other three pillars. This one is is selling well.
And at the back half of 2021, we really spent a lot of time, focusing on hiring and bringing in the proper sales professionals to drive our target and we do have the sufficient team to drive our targets and our guidance for 2022, but that sales force not only do we hire them in existing locations, but we also hired them in new geographic locations such as <unk>.
Through the acquisition of exact Earth, we added sales professionals in Middle East and Central America, where we Didnt have coverage before which is also another one of our growth pillars, which is expanding.
Expanding into new geographies. So we did that growth and now you're also the great News is we're already starting to see the benefit of that already we just talked about the no deal. The seven figure deal that we just closed in this quarter and then also if you look at our sequential growth from a quarter over quarter standpoint for Q1 and from our ending Q4.
'twenty, one IRR to where we expect to be for a midpoint of our guidance of $10 2 million dollar increase. So then you can easily see the paths on how to get to 100 to 105 for our and also in the same token how do we get to our revenue targets.
You asked about also the launch and risk of course, there's always risks with that in there, but we built in the proper you know.
Our focus in and you know our forecasting efforts around that so we feel very very confident in our guidance.
Yeah.
Great. Thanks.
Thank you. Our next question comes from Josh Sullivan with the Benchmark Company. Please go ahead.
Hi, good afternoon.
Just as far as the radio geolocation market 40 satellites, you have how how large do you see that constellation growing too how much capacity or area of coverage does it have right now.
And then maybe what does the pipeline look like at this point.
Sure.
A lot of our capabilities our software defined as you'll recall, we have a software defined constellation, which allows us to upgrade the capabilities through software.
So I would expect that.
A meaningful portion of our overall a constellation over time will be capable of geo locating signals.
We have demonstrated in a process of demonstrating that in multiple bands you mean, UHF VHF, Alabama <unk> SaaS.
And demonstrating this geolocation from single satellites dual satellites and multiple satellites.
And we expect to continue to deploy in and augment and increase that capability.
We are very very encouraged by the demand for these capabilities on a global basis, our desktops 40 satellites cover the whole globe already so we have in that sense and how much percent of global coverage was a question of yours.
And.
As I said, we're very excited about participating in this market than making a meaningful and material difference between the maritime sector, whether you have a very large customer base and Dr. Apple detection and maritime domain awareness is a big is a big thing.
As well as Geo locating signals like GPS jamming and others that are more relevant in other areas of the defense industry.
We do not breakout.
A separate market at this point in time.
Got it.
Then just as far as the comment there at the end of the prepared remarks, just options for added cash to the balance sheet can.
Can you just dig into that a little bit what are those options or what are you thinking about that.
Yeah. So yeah, we did end the year at $110 million of cash and we are in discussions and in advancing our credit or expanding our credit facility.
To drive further cash and then also improve upon our existing balance sheet.
Got it thank.
Thank you for the time.
Thank you and our next question comes from Weston Twigg with Piper Sandler. Please state your question.
Hey, Thanks for taking my question I just wanted to follow up on the the conflict in Ukraine, you mentioned some of the government opportunities, but you also just mentioned on the Geo location sides and some dark vessel tracking and I'm wondering if there's anything specifically that may come out of this conflict of a highlight.
More governmental needs among potential customers for your products.
Okay.
It is clear to me that expire and then in all of our fellow space companies and everyone is playing a vital role for humanity in these fast before freedom and democracy and with everything there.
There is always going to be opportunity when there are challenging.
And so I do believe that we have started already.
To see how.
Beneficial at the impact and the services from commercial companies can be in bringing this transparency and through to the table.
So I do think that as.
As there always is the case with any kind of challenge that there will be opportunities that will come out of it that this is going to be no different.
By as few from space, It's a unique one and we have been and intend to continue.
Reaching our technology and innovation to help humanity solve problems and challenges on the earth wherever they may be in whatever form they they might be.
Okay. Thank you.
I also wanted to follow up on that on the sales commentary you said he's been hiring a lot of salespeople can you give us an idea of how many salespeople you have now versus you did versus the number you had a year ago.
Yeah, we've we have over 30 expansion.
Yeah, sorry, we have over 30 sales professionals around the globe and we almost for the last couple of years have been doubling doubling that force. So we have a we've doubled it and we do have the proper sales team in place to drive our 2022 guidance.
We are of course are always looking to clarify yeah go ahead.
Well just to clarify you doubled from last year does that include the sales folks from exactly right.
Yes, we did pick up some folks from the from the exact or side. It wasn't a large quantity. If you remember the whole acquisition itself. There was only 30 33 people that we picked up from the acquisition itself. So it was a smaller smaller quantity of head count.
Perfect. Okay. Thank you.
Thank you and just a reminder to ask a question press star one.
Our next question comes from Ric Prentiss with Raymond James Please state your question.
Thanks, Good afternoon, and good evening everyone.
Oh, yes.
Yep can you hear me, okay very good thanks.
Couple of follow up questions first appreciate the annual but also clearly you guys have definitely helps looking at pacing.
Following up on some of the other questions one of the other key topics in the markets. These days is inflation, how should we think about your ability.
To either take advantage of inflation or be hurt by inflation, both on the revenue guidance on the EBIT line.
I can talk about it from a business perspective.
And I would look at it more from a from an AR.
Advantageous position.
Given that you have a pretty well oiled global supply chain that allows us to take advantage of where they are certain displacements.
Given the data that we have we haven't very very unique view on the global supply chain.
And so we don't see that as a material drag on our performance from back perspective, I don't know Tom If you have if you have additional points that you want to make from a pump on the EBIT side.
No I mean, I know the focus obviously you like the company in general on there are efficiencies.
And driving our cost structure down that we have in our guidance I know, we've you know our relentless with her our focus on the on the push to profitability, but I would say I mean the.
I mean, we really just take advantage of our great.
Focus that we've got on our Tam and are use cases that we can solve to really provide the value to our customers. So I think the ultimate you know advantage that we get is just our competitive edge and what value we provide to our customers that really drives on the taking advantage of what we can do with the with the solutions that we sell to our customers.
Okay.
Second question for me is you talked about your four pillars of growth.
Sales of where he got discussed.
Lou here, just trying to think about what research and development budgets need to be there to support the products and the capabilities. How should we think about the size and kind of your R&D budgets as you as you look to grow the company and so we think of it as a dollar level or as a percent of revenue level.
I think in the near term, it's probably a good way to think of it more from a dollar perspective.
Over the over the years, we have built such an enormous moat given the scale of our operation in the business that we're in.
So he isn't space Harrier attached Albert's largest RF sensing constellation the world's largest multi purpose a constellation and we are fully vertically integrate this gives US you know very very unique leverage and the speed of innovation and value per dollar that is really really quite exceptional.
That's like the beauty of all data businesses. Once you have the scale it becomes self reinforcing machine and it really given that our infrastructure is like fixed insights.
It doesn't really make that much sense, just think of R&D as a percent of revenue. It's more of a dollar figure to just keep on driving that 10 X every five year innovation capability off our infrastructure, both analytics space and ground I'm on a.
<unk> is an annual basis.
Okay last one for me.
You mentioned free cash flow or cash flow positive and 24 to 30 months.
How are you defining that as that EBITDA less interest less capex.
Yeah, Yeah, it's it's all the operating expenses plus the plus the capex.
To get to the okay.
So it does include the single interest expense in the future and if you do ramp up.
The credit facility that would be kind of included in that thought of where the breakeven in terms of windows.
Yeah, all of that would be included in that analysis yet.
And is there a kind of a level of Capex, you think you'll need on an ongoing basis I know there were some items.
<unk>, just shrinking probably hasn't changed that much I wouldn't say, we're still focused on our for our core infrastructure of that $10 million to $12 million of annual Capex.
And just to give you an idea of the numbers that we had in 2021, we did spend about out of our total capex of approximately $11 million was spent on capex for the parts and the launches for all four of our solutions. So that that also included space services in that number. So we are staying on track with what we.
We're talking about that leverage infrastructure of 10 to 12, a year, while our revenue and are are for all the solutions are climbing specifically maritime you shouldn't whether that uses the whole satellite constellation to collect the data once and sell it as many times as possible.
Makes sense appreciate the only thing that's changing on Capex as space services and that will go with the business.
Okay, great. Thanks, everyone.
Thank you there are no further questions at this time I'll turn the floor back to Peter <unk> for closing remarks.
Okay.
Clothing really thank you all for joining us today.
Our immensely excited about our opportunity.
The total addressable market value in excess of $100 billion by 2025 more than 200000 potential customers.
And all the cash that we will need to address this.
As we close out this year, we have a tremendous opportunity in front of us, but to me and I got really focused on executing against our four growth pillars. It's what we do every single day and we continue to invest in the people and products to enhance our offering for current and potential customers.
There are few from space inspire has is truly a unique one.
And we will continue to leverage our technology and innovation to help humanity solve problems and challenges on Earth.
Whatever they might be and we are humbled and proud to be a contributor to facing and overcoming those challenges.
Yeah.
Thank you.
And with that this concludes today's conference all parties may disconnect have a good day.