Q1 2024 AST SpaceMobile Inc Earnings Call & Business Update
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Operator: Good day, and thank you for standing by. Welcome to the Ast Spacemobile first quarter 2024 business update call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your host today, Scott Wisniewski, Chief Strategy Officer of Ast Spacemobile. Please go ahead.
Good day, and thank you for standing by welcome to the a S. T space mobile first quarter 2024 business update call. Please be advised that today's conference is being recorded I would now like to hand, the conference over to your host today, Scott with New ski Chief strategy Officer of a S D.
Speaker Change: <unk>. Please go ahead.
Speaker Change: Yeah.
Scott Wisniewski: Thank you and good afternoon, everyone. Let me refer you to slide two of the presentation, which contains our safe harbor disclaimer. During today's call, we may make certain forward-looking statements. These statements are based on current expectations and assumptions, and as a result, are subject to risks and uncertainties. Many factors could cause actual events to differ materially from the four different statements made on this call.
Speaker Change: Thank you and good afternoon, everyone.
Speaker Change: We refer you to slide two of the presentation, which contains our safe Harbor disclaimer.
Scott Wisniewski: For more information about these risks and uncertainties, please refer to the risk factors section of AST Spacemobile's annual report on Form 10-K for the year that ended December 31, 2023, filed with the Securities and Exchange Commission and other documents filed by AST Spacemobile, the FCC, from time to time. Also, after our initial remarks, we will start our Q&A section with questions submitted in advance by our shareholders. Welcome, everyone.
Speaker Change: During today's call we may make certain forward looking statements. These statements are based on current expectations and assumptions and as a result are subject to risks and uncertainties.
Speaker Change: Many factors could cause actual events to differ materially from the forward looking statements on this call.
Speaker Change: For more information about these risks and uncertainties. Please refer to the risk factors section of the <unk> space Mobile <unk> annual report on Form 10-K for the year that ended December 31 to 23 filed with the Securities and Exchange Commission and other documents filed by S. T space mobile with the SEC from time to time.
Speaker Change: Also after our initial remarks, we will be starting our Q&A section with questions submitted in advance by our shareholders.
Scott Wisniewski: For those of you who may be new to our company and mission, there are over 5 billion mobile phones in use today around the world, but many of us still experience gaps in coverage as we live, work, and travel. Additionally, there are billions of people without cellular broadband who remain unconnected to the global economy. The markets we are pursuing are massive, and the problem we are solving is important and touches nearly all of us.
Speaker Change: Welcome everyone for those of you who may be new to our company mission. There are over 5 billion mobile phones in use today around the world, but many of them still experienced gaps in coverage as we live work and travel.
Speaker Change: Additionally, there are billions of people without cellular broadband remain unconnected to the global economy.
Speaker Change: The markets, we are pursuing a massive and the problem. We're solving is important in touch with nearly all of us.
Scott Wisniewski: In this backdrop, Ast Spacemobile is building the first and only global cellular broadband networking space to operate directly with everyday, unmodified mobile devices, supported by our extensive IP and patent portfolio. It is now my pleasure to pass it over to Chairman and CEO, Abel Avellan, who will go through our activities since the last public update.
Speaker Change: In this backdrop ASC space mobile is building the first and only global cellular broadband network and space to operate directly with everyday unmodified mobile devices supported by our extensive IP and patent portfolio.
Speaker Change: It is now my pleasure to pass it over to chairman and CEO about how long will go through our activities since the last public update.
Abel Avellan: Thank you, Scott. We're happy to be back together with you after six weeks since our last Business Update call. Our most important update to share since our last call is the execution of our first definitive commercial agreement with AT&T. We have signed an agreement with AT&T through 2030 to provide space-based cellular broadband to AT&T and their end users through our revenue share model. This is a major milestone, and we look forward to the commercial service with Block.one and beyond, as these specifically outline the product and pricing models we will go to market with. We expect to replicate variations of these models in various markets around the world. While each might have slightly different features, this is the spirit upon which our core customers' offerings are built upon.
Speaker Change: Thank you God, we're happy to be back again with you after six weeks since our last business update call.
Speaker Change: Our most important update to chance since our last call is the execution of our first definitive commercial agreement with AT&T.
Speaker Change: We have signed an agreement with AT&T through 'twenty 32 provide is paid based cellular broadband to AT&T and their end users through a revenue share model.
Speaker Change: This is a major milestone and we look forward for.
Speaker Change: For the commercial service with block one and beyond.
Speaker Change: As these and specifically outline the product and pricing models, we will go to market with.
Speaker Change: We expect to replicate variation of these models in various markets around the world.
While each might have a slightly different features this is the spirit in which our core customers offering is built to Bolton.
Abel Avellan: AT&T has been an incredible partner to us over the last few years, and we look forward to the next stage of our relationship. And in case you didn't see it on the MasterGolf broadcast a few weeks ago, you should check out the commercial that AT&T ran with Ben Stiller and Jordan Spitz showing the benefit of our space-based cellular broadband technology. We're incredibly busy here in Texas as we complete our first five commercial satellites. These five Bluebirds satellites will mark the beginning of our commercial operation. All necessary parts are at our facilities and are being integrated into this outlet.
Speaker Change: AT&T has been an incredible partner to us over the last few years and we look forward to the next stage of our relationship.
Speaker Change: And in case, you didn't see in the Master go broke out a few weeks ago, you should check out the commercial about AT&T, Iran with Ben Stiller on Jordan's Pete.
Speaker Change: Join the benefits of our space based cellular broadband technology.
Speaker Change: We're in great shape with D. C here in Texas as we complete our first FICO merchant satellites. These five bluebird side I will mark the beginning of our commercial operations all necessary bogs at our facilities and being integrated into the satellites. These includes depart from the <unk>.
Abel Avellan: This includes the part from the two suppliers, which we discussed on the last call, but have things been resolved? and Michael Completion is well on their way. So, based on this current timeline, we want to reiterate our guidance from six weeks ago that we are on target for July or August delivery of our five Block 1 satellites to the Cape Canaveral launch pad, with our Orbital Launch Schedule shortly thereafter. Of course, launch timing is subject to many factors, including several outside of our control. But as of today, everything is moving according to the updated schedule.
<unk>, which we discussed on the last call, but has since been resolved.
Michael: I'm Michael completion these weight on their way.
Michael: So based on these current timeline, we want to reiterate our guidance from six weeks ago that we are on target for July or August delivery of our five block one satellites to the Cape Canaveral launch path.
Michael: Our albeit on a larger scale you chose shortly thereafter.
Michael: Of course launched Diamond soldier to many factors, including several outside of our control.
Michael: But as of today everything is moving according to the updated schedule it.
Abel Avellan: We will share additional progress updates as we approach the launch. With these first five satellites, we will have the ability to offer U.S. nationwide non-continuous service with over 5,600 individual cells using premium low-band spectrum. Let me spend a moment discussing our Block 1 satellites and the importance of their size and power. These first five satellites will be the largest commercial satellites in low-Earth orbit alongside Blue Walker.
Michael: We will share additional progress update we approach the launch.
Michael: With these first five satellites, we will have the ability to offer U S nationwide non continued service with over five.
Michael: 600 individual sales using three new low band spectrum.
Michael: Let me spend a moment discussing our block one satellites and the importance of their size and power.
Michael: These first five Saturday will be the largest commercial satellites in load at Orbitz alongside Millworker three.
Abel Avellan: That, combined with the processing capacity of each of them, allowed us to achieve our commercial goals with less than a hundred satellites. This will enable cellular broadband everywhere for the phone you have in your pocket, thanks to the technology we invented, and that is on the way to becoming the standard that mobile network operators plan to deploy. On the regulatory front, we're working closely with the FCC to secure market access approval in the United States.
Michael: <unk> combine it with the processing capacity of each of them allowed us to achieve our commercial goals with less than 100 satellites.
Michael: They will enable central broadband everywhere for the phones you have in your pocket.
Michael: Thanks to technology, we invented and that is only way to become the standard the mobile network operators plan to deploy.
Michael: On the regulatory throne, we're working closely with the FCC to secure market access approval in United States. The will of course be a major milestone for US. We are encouraged by the Sec's recent actions to prototype satellite based telecommunications as evidence by our re flagging to the.
Abel Avellan: This will, of course, be a major milestone for us. We are encouraged by the FCC's recent actions to prioritize satellite-based telecommunications, as evidenced by our re-flagging to the United States and other new ruling-making activities. The V-BAN application public notice period recently closed, which was a major milestone in the process.
Michael: United States.
And the older <unk>.
Michael: <unk> ruling making activities.
Michael: Our Beaver and application public notice periods recent did close which was a major milestone in the process. We will continue to work closely with the FCC to advance these critical approval process.
Abel Avellan: We will continue to work closely with the FCC to advance this critical approval process. Additionally, I am very excited as we continue to advance discussions with new strategic partners, using commercial prepayments alongside new commercial agreements. We currently have no plans for the remainder of this year to pursue an underwritten public security offering to supplement our existing capital.
Michael: Additionally, I am very excited and we continue to advance discussions with new strategic partners using commercial prepayments alone signed new commercial agreements.
Michael: We currently have no plans for the remainder of this year to pursue and on the REIT and poorly security offering to Superman our existing capital facilities.
Abel Avellan: We also established our first government contract, one that generated more revenue for AST in the first quarter. Our first commercial revenue, and again, this represents a framework which we can utilize for future government agreements. Simultaneously, we are continuing talks with our first government customers, negotiating additional services we could potentially provide to expand our existing relationship. While the core focus of our strategy is consumer cellular broadband, we do think that the government opportunity is a natural extension of our capabilities and can be very meaningful to our company over time.
We also established our first government contract one that generated more revenue per <unk> in the first quarter. Our first commercial revenue and again these represent a framework, which we can utilize for future government agreements simultaneously, we're continuing talks with our first Gorman.
Michael: Customers negotiating additional services, we could potentially provide to expand our existing relationships.
Michael: While the core focus of our strategy consumer cellular broadband we do think that the government opportunity is a natural extension of our capabilities and can be very meaningful to our company overtime.
Abel Avellan: In summary, we're making progress on all fronts, operationally, commercially, and regulatory. And we have set the foundations for enabling broadband connectivity everywhere for the phone you have in your pocket. And with that, I will pass it to Sean for the financial update.
Michael: In summary, we're making progress in all fronts operationally commercially and regulatory we said different nations of enabling broadband connectivity everywhere for the phones you have in your pocket and.
Sean: And with that I will pass it to Sean for the financial update.
Sean Robert Wallace: Thanks, Abel, and good afternoon, everyone. Let's review the key operating metrics for the first quarter that are displayed on the slides. On the first chart, we see that for the first quarter of 2024, we had non-GAAP adjusted cash operating expenses of $31.1 million versus $38.6 million in the fourth quarter. Non-GAAP-adjusted operating expenses exclude certain non-cash operating costs, including depreciation and amortization, and stock-based compensation.
Sean: Thanks, Bill and good afternoon, everyone. Let's review the key operating metrics for the first quarter that are displayed on slide six on the first chart. We see for the first quarter of 2024, we had non-GAAP adjusted cash operating expenses of $31 1 million versus $38 6 million in the fourth quarter.
Sean: non-GAAP adjusted operating expenses exclude certain noncash operating costs, including depreciation and amortization and stock based compensation.
Sean Robert Wallace: In line with our guidance, our first quarter non-GAAP adjusted operating expenses fell by $7.5 million versus the fourth quarter. Our research and development expenses fell by $6.5 million this quarter due to the continued completion of important R&D projects. Our R&D expenses consist primarily of non-recurring development activities for which we typically engage third-party vendors, and payments are based on the completion of milestones. Our engineering services expenses also fell by $0.6 million, and our general and administrative expenses decreased by $0.4 million in the first quarter as compared to the fourth quarter.
Sean: In line with our guidance, our first quarter non-GAAP adjusted operating expenses fell by $7 $5 million versus the fourth quarter, Our research and development expenses fell by $6 5 million. This quarter due to the continued completion of important R&D projects are R&D expenses consist primarily of.
Sean: Nonrecurring development activities for which we typically engaged third party vendors and payments are based on the completion of milestones.
Sean: Our engineering services expenses also fell by $3 six.
Sean: $6 million and our general and administrative expenses decreased by <unk> 4 million in the first quarter as compared to the fourth quarter.
Sean Robert Wallace: We have made a series of cost adjustments to capture about a million dollars in engineering services and G&A cost savings. Turning to the second chart on this page, capital expenditures for the first quarter were $26.7 million versus $33.9 million for the fourth quarter. The figure was made up of some modest launch payments, capitalized direct materials for the Block 1 satellite, and additional facility and production equipment for our assembly, integration, and test facility in Midland.
Sean: We have made a series of cost adjustments to capture about $1 million in engineering services and G&A cost savings.
Sean: Turning towards the second chart on this page our capital expenditures for the first quarter were $26 $7 million versus $33 9 million for the fourth quarter.
Sean: Figure was made up of some modest launched payments capitalized direct materials for the block one satellites.
Sean: And additional facility and production equipment for our assembly integration and test facility in Midland.
Sean Robert Wallace: Capital expenditures trended down as we again moved towards the completion of the Block 1 satellite construction. As of the end of the first quarter, we have spent over 95% of the expected amounts for the five Block 1 satellites. We are still projecting a total spend of approximately $150 million for the five VB1 satellites.
Sean: Capital expenditures trended down as we again move towards the completion of the block one satellite construction.
Sean: As of the end of the first quarter, we have spent over 95% of the expected amounts for the five block one satellites. We are still projecting total spend of approximately $150 million for the five VB one satellites.
Sean Robert Wallace: And on the final chart on the slide, we ended the first quarter with $212.4 million in cash. We are continuing to pursue using the balance of our senior credit facility, which has a gross amount of $51.5 million available. As I mentioned at the end of March, efforts around raising strategic capital may take precedence over the senior credit facility, and at a minimum, the continued deferment has reduced a bit of the negative carry we would have incurred if we had accessed the facility earlier. However, our ability to access this facility is subject to certain conditions and approval.
Sean: And on the final chart on the slide we ended the first quarter with $212 $4 million in cash we are continuing to pursue using the balance of our senior credit facility, which has a gross amount of $51 5 million available as I mentioned at the end of the of March efforts around raising strategic capital.
Sean: May take precedence over the senior credit facility and at a minimum to continued deferment has reduced a bit of the negative carry we would.
Sean: We would have incurred.
Sean: We had excess facility earlier.
Sean: Our ability to access this facility with subject to certain conditions and approvals.
Sean Robert Wallace: As we stated in our 10-Q, we believe this cash, as well as our ability to raise capital through our existing facilities, is sufficient to support our expenditures for at least the next 12 months. As we have also discussed in our 10-Q, our cost positions and capital plans are quite modular, and this characteristic provides us with the flexibility to increase or decrease our rate of expenditures depending upon changes in our build-out plans and availability of capital. This flexibility provides us with comfort that we can manage our liquidity profile dynamically depending on our rate of raising capital.
Sean: As we stated in our 10-Q, we believe this cash as well as our ability to raise capital through our existing facilities is sufficient to support our expenditures for at least the next 12 months as we've also discussed in our 10-Q, our cost positions and capital plans are quite modular and this characteristic provides us.
Sean: Flexibility to increase or decrease our rate of expenditures depending upon changes in our build out plans and availability of capital.
Sean: This flexibility provides us comfort that we can manage our liquidity profile dynamically depending on our rate of raising capital.
Sean Robert Wallace: In March, we provided guidance on our expected operating expense levels. As we discussed earlier, we have been supporting the development efforts of our two critical satellite designs, Block 1 and Block 2, our ASIC chip design, and the construction of five BB1 satellites. The completion of this BB1 work and a significant portion of the BB2 and ASIC design work is expected to result in a material reduction in our adjusted operating expenses and future capital expenditures.
Sean: In March we provided guidance on our expected operating expense levels as we discussed earlier, we have been supporting the development efforts of our two critical satellite designs block, one and block to our ASIC chip design and the construction of five <unk> satellites. The completion of the <unk> work and a significant portion.
Sean: Of the BB two in ASIC design work is expected to result in a material reduction in our adjusted operating expenses and future capital expenditures. This reduction in cash expenditures will be done without a material reduction in our employee head count as most of these reductions are related to the completion of third party work.
Sean Robert Wallace: This reduction in cash expenditures will be done without a material reduction in our employee headcount, as most of these reductions are related to the completion of third-party work. As I mentioned during the fourth quarter earnings call, we now project that our adjusted cash operating expenses will come in at around an average of $30 million per quarter for 2024 as the Block 1 design is completed and the Block 2 design approaches completion. These figures will vary depending upon manufacturing activity in each period. This guidance does not include the expected cost of approximately $15 million related to the tape out and initial production of our ASIC.
Sean: As I mentioned during the fourth quarter earnings call. We now project that our cash adjusted cash operating expenses will come in at around an average of $30 million per quarter for 2024 as the block one design is completed and the block two design approaches completion.
Sean: Figures will vary depending upon manufacturing activity in each period.
This guidance does not include the expected cost of approximately $15 million related to the tape out and initial production of our ASIC chips.
Sean Robert Wallace: These ASIC-related costs will be recognized as an R&D expense in subsequent quarters in 2024 as the milestones are completed. We also plan to reduce our outlook for capital expenditures as we reach the final investments for BV1. For the next two quarters, we expect to spend, in the aggregate, approximately $25 to $40 million in capital expenditures. Any increase beyond these levels will be in conjunction with the timing of the deployment of our Block II satellites, which could be either in late 2024 or the first quarter of 2025. Timing of the changes in our adjusted operating expenditures and capital expenditures, as I've just described, could be delayed or may not be realized due to a variety of factors.
Sean: These ASIC related costs will be recognized as an R&D expense in subsequent quarters in 2024 as the milestones are completed.
Sean: We also plan to reduce our outlook for capital expenditures as we reached the final investments for BV one for.
Sean: For the next two quarters, we expect to spend in the aggregate approximately $25 million to $40 million in capital expenditures.
Sean: The increase beyond these levels will be in conjunction with the timing of the deployment of our block two satellites, which could be either in late 2024 or the first quarter of 2025.
Sean: Timing of the changes in our adjusted operating expenditures and capital expenditures as I've, just described could be delayed or may not be realized due to a variety of factors.
Sean Robert Wallace: As I discussed in our last earnings call, we continue to work with our advisors on developing a financing package from quasi-governmental sources, including export credit agencies. Satellite and other infrastructure providers have historically utilized these agencies to source cost-effective, long-term debt funding for large projects. The key underpinning of these funding structures has been proven technology and the sale of significant capacity through long-term agreements to large, credit-worthy entities. We remain focused on developing a structure and creating an information package that will support our potential financing.
Sean: As I discussed in our last earnings call. We continue to work with our advisers on developing a financing package from quasi government sources, including export credit agencies.
Sean: Satellite and other infrastructure providers have historically utilized these agencies to source cost effective long term debt funding of large projects. The key underpinning of these funding structures has been proven technology and the sale of significant capacity through long term agreements two large credit worthy entities we remained.
Sean: Just on developing a structure and creating an information package that will support our potential financings we.
Sean Robert Wallace: We are encouraged by the progress we are making, but we are still in very early stages, and there can be no assurance that we'll be successful in the pursuit of this type of funding. And with that, this completes the presentation component of our earnings call, and I pass it back to Scott.
Scott: We are encouraged by the progress, we're making but we are still in very early stages and there can be no assurance that we will be successful in the pursuit of this type of funding and with that this completes the presentation component of our earnings call and I pass it back to Scott.
Scott Wisniewski: Thank you, Sean. Before we go to the queue of analyst questions, we'd like to address a few of the questions submitted by our investigators. Operator, could you please start us off with the first question?
Scott: Thank you Sean before we go to the queue of analyst questions wed like to address a few of the questions submitted by our investors operator could you. Please start us off with the first question.
Operator: The lead-in from New Zealand asks what milestones investors should look out for.
Scott: <unk> from New Zealand asked what milestones should investors look out for.
Scott Wisniewski: Looking ahead to the remainder of 2024, I think the biggest milestones to look out for are the launch and successful operation of our Block 1 satellites, market access, regulatory approval in the United States, commercial agreements with additional M&O partners, and then further progress on our government program. We're really set up for an exciting summer here, and we look forward to sharing updates on these milestones with you as they occur.
Leanne: Thank you Leanne and looking ahead to the remainder of 2024.
Leanne: The biggest milestones to look out for our launch and successful operation of our block one satellites.
Leanne: Access regulatory approval in the United States.
Commercial agreements with additional M&A partners and then further progress on our government program.
Leanne: We're really set up for an exciting summer here and we look forward to sharing updates on these milestones with you as they occur.
Scott Wisniewski: Jordan from North Carolina asked: It was reported that the FCC will be publishing the official report and order for SCS services. Can you please explain if this rule and the FCC approval for QV spectrum backhaul are required conditions for the completion of definitive agreements with AT&T, FirstNet, or other MNOs?
Speaker Change: Jordan from North Carolina asked.
Speaker Change: Reported that the FCC will be publishing the official report and order for Ses services.
Speaker Change: Can you. Please explain if this rule and the FCC approval for Q E spectrum backhaul are required conditions for the completion of definitive agreements with AT&T for a snack or other msos.
Scott Wisniewski: Thank you, Jordan. This is certainly not a requirement for commercial agreements, as demonstrated by the commercial agreement we announced today with AT&T. When we go to the FCC or really any regulatory body globally, we go with our in-country partner, and they further support the technology and validate the case that we're making. The FCC has been moving incredibly fast here in establishing rules for direct to device, and we've been working with them for a long time on that.
Speaker Change: Thank you Jordan.
Speaker Change: Certainly not a requirement for commercial agreements as demonstrated by the commercial agreement, we announced today with AT&T.
Speaker Change: When we go to the FCC or really any regulatory regulator globally, we go with our in country partner and they further support the technology and validate the.
The case that we're making.
Speaker Change: The FCC has been moving incredibly fast here in establishing rules for director device and.
And we've been working with them for a long time on that.
Scott Wisniewski: And we believe that this is going to ensure that our technology can be utilized once it's available commercially. And our M&O partners fully understand the regulatory process and are even much closer to it than us. And they're comfortable that our system will be regulated and usable.
Speaker Change: And we believe that this is going to ensure that our technology can be utilized once it's available commercially.
Speaker Change: And our <unk> partners fully understand the process of the regulator and are even much closer to them than us and they are comfortable that our system will be regulated and usable.
Scott Wisniewski: Bleeding from New Zealand ash. Is AST focusing on fundraising from past partners or new partners?
Speaker Change: Well he didn't from New Zealand asked.
Speaker Change: As as he's focusing on fundraising from past partners or new partners.
Abel Avellan: Linden, same for the question. First of all, we're very proud of the strategic support that we have. We have bought a phone company who got invested three times in our company, Rakuten and American Tower twice. AT&T, Google, and Bell Canada have all invested. The Reinforcing Ocean is the industry leader of the technology that we invented, direct-to-device, on a global basis.
Linda Central: Linda Central the question.
Linda Central: But first of all we're very proud of the it's a thesis holds the support that we have.
Linda Central: We have Vodafone who hadn't missed it three times in our company like within American Dyewood twice.
Linda Central: AT&T, Google and Bell, Canada have all invested.
Linda Central: They reinforce the notion that <unk> is the industry leader.
Linda Central: Of these technology that we invented directly rise.
Abel Avellan: We are super excited about where we are with new and old strategic partners. We have around 50 operators on a global basis that we have MOUs and agreements of understanding and relationships with. There's a lot of excitement from them about what we mean for the plans and for providing universal connectivity to every regular cell phone. So we're excited. We are bullish about where we are in that process with them.
Linda Central: On a global basis, we are super excited about where we are we knew.
Linda Central: Or if the <unk> buttons, we have around 50 operators on a global basis, though we have a more use on agreements of understanding and relationships.
Linda Central: Based on a lot of excitement from them.
Linda Central: What do we mean for their plans for provide universal connectivity to every level of cell phone.
Linda Central: So we're excited we're excited we are bullish about where we are in that process with them.
Abel Avellan: And we are turning more into operational agreements, similar to what we did with AT&T. There are more definitive commercial agreements. The commercial agreements are planned to include prepayments that are going to be fundamental for the continued build out of our network.
Linda Central: On.
Linda Central: We are turning more into operational agreements.
Linda Central: Similar to what we did with AT&T that are more definitive commercial agreements.
Linda Central: The commercial agreements are going are planned to include prepayments.
Doug: Doug I'm going to be fundamental for the continued buildout of our network.
Scott Wisniewski: And with that, I'd like to thank our shareholders for submitting these questions. Operator, let's open the call to analyst questions now. Thank you.
Speaker Change: And with that I'd like to thank our shareholders for submitting these questions operator, let's open the call to analyst questions now.
Operator: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the start key.
Speaker Change: Thank you at this time, we'll be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
Speaker Change: Confirmation tone will indicate your line is in the question queue. You May Press Star two if you would like to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star keys.
Operator: Our first question comes from the line of Mike Crawford with B. Reilly Securities. Please proceed with your question. Thank you.
Speaker Change: Our first question comes from the line of Mike Crawford with B Riley Securities. Please proceed with your question.
Michael Roy Crawford: Thank you. I'm glad to hear you're on track with these launch milestones. Can you provide us any additional color on how you expect to fly the first five Blue Birds? Would that be in like a string of pearls formation or more spread out, and would it potentially enable access and, say, belk into the service area or just in the U.S.?
Michael Roy Crawford: Thank you I'm glad to hear you're on track on these launch milestones can you provide.
Michael Roy Crawford: Provide us any additional color on how you expect to fly the first five bluebirds would that be in like a string of pearls formation or more spread out and what would the what.
Speaker Change: What it potentially enable access and say Bell, Canada service area or just in the U S.
Speaker Change: Okay.
Abel Avellan: Thank you, Michael. Well, we are facing them in a way that will prioritize the United States and also some government applications that we have. The configuration will initially be as we deploy it out of the launchers in three barrels. There are certain configurations that we are tailoring for the users of these five satellites. And then, as we move on time after the launch, we will spread them evenly as part of the launchers that will complement the constellation. We will prioritize the 53-degree inclination that gives us access to a 59-degree latitude all the way to the equator and from the equator to minus 59 degrees of latitude with this configuration.
Speaker Change: Thank you Michael well, we are facing them in a way that will prioritize United States also some government obligations that we have.
Speaker Change: Equal figuration when it will be initially we deployed out of the launches.
And then three barrels.
Speaker Change: There are certain configurations.
Speaker Change: We are.
Speaker Change: Day learning for the.
Speaker Change: The usage of <unk> satellites.
Speaker Change: And then us.
Speaker Change: We move on time after the launch we will spread evenly as part of the net launches that that would complement the constellation will lose Paradise and the 53 degree inclination.
Speaker Change: They'll give us access to a 59 degrees of latitude all the way to the equator.
Speaker Change:
Speaker Change: From the equator to minus 59 degrees.
Speaker Change: <unk>.
Speaker Change: With this with these configuration.
Michael Roy Crawford: Okay, thank you, Abel. And then... How I think the first [inaudible] satellite will just be a single satellite that launches, and then after that, maybe they're in groups of four, perhaps, depending on, you know, launch vehicle use.
Bella: Okay. Thank you Bella men.
Bella: How.
Bella: I think the first.
Bella: Block to SAP.
Bella: Satellite will just be a single satellite launches and then after that maybe they're in groups of four perhaps depending on you know launch vehicle used.
Abel Avellan: Yes, there will be, we launch in groups of four or five, we're in the process of working on that for the next batch, and Block 2 is larger. I mean, Block 1 is already the largest. Thank you.
Speaker Change: Yes that would be.
Speaker Change: We launched <unk> in group was four or five we're in the process of.
Speaker Change: Working on that for the next batch.
Speaker Change: Block two larger I mean block blood one already the largest.
Speaker Change: Objects in space.
Speaker Change: That's what we need few of them on I think the only thing bigger than announces the ISS in Lisle.
Speaker Change: So we're launching five.
Speaker Change: <unk>.
Speaker Change: The summer.
Speaker Change: And then we move we're moving blocks of four.
Speaker Change: On the on the vehicles Figuration Louise studies.
Speaker Change: That is the second version on the upgraded version for Bluetooth.
Speaker Change: Okay.
Michael Roy Crawford: And then the final, final one for me is, can you just remind us what levels of service you anticipate being able to provide on different satellites and your Space Mobile Constellation?
Excellent. Thank you and then final and final one from me is can you just remind us.
Speaker Change: What levels of service, you envision being able to provide at different.
Speaker Change: Core entities.
Speaker Change: <unk>.
Satellites in your space mobile constellation.
Abel Avellan: Yeah, the type of service that we can actually enable, regardless of the number of satellites, is the same. So what changes is how often you have it above you that you can use.
Speaker Change: Yes, the type of service that we actually gotten enabled regardless of the number of satellite. This is the same so what why it changes how often do you have in a bold view that you can use it. So so we this is a broadband service is a full data service.
Abel Avellan: So this is a broadband service; it's a full data service. We have worked with our partners to enable voice, data, internet, and download. I don't know if you've seen it, but we were able to stream videos directly from the satellite to regular phones. So this is a full broadband experience.
Speaker Change: We have worked with our partners to do to enable boys data Ethernet download.
Speaker Change: I don't know Youll see it we were able to just where streaming videos directly from the satellite too.
Speaker Change: So this is a full broadband experience.
Abel Avellan: What it changes as we add satellites is for how long you can enjoy it during the day. But, you know, with these five satellites, we, we. Of course, they will not be available all the time; there will be no continued service only with five satellites. But as we have more satellites, that persistence of the service keeps increasing as we... and we launch more.
Speaker Change: What he change are we add satellite is for how long you can enjoy the during the day, but you know with the with these five satellites.
Across all United States of course, it will not be available all the time there will be no continued service only we fight satellites, but how we add more side like that.
Speaker Change: The persistence of the service keep increasing.
Speaker Change: And we launch more.
Speaker Change: Okay. Thank you very much.
Operator: Thank you. Our next question comes from the line of Brian Craft with Deutsche Bank. Please proceed with your question.
Speaker Change: Thank you. Our next question comes from the line of Bryan Kraft with Deutsche Bank. Please proceed with your question.
Brian Craft: Hey, good afternoon, guys. I just wanted to ask you about the AT&T agreement. Can you talk about what the key elements of the agreement structure are? Is it consistent with the 50-50 revenue share model you've talked about historically? Is this just formalizing the MOU you already had, or are the terms any different? And is there any impact on the $20 million in prepaid revenue that you'll be getting from AT&T later this year? In other words, will there be additional prepaid revenue that is, perhaps, coming in as part of this agreement? Thank you.
Bryan Kraft: Hey, good afternoon, guys I just wanted to ask you on the new ATM on the AT&T agreement.
Can you talk about what the key elements of the agreement structure or is it consistent with the 50 50 revenue sharing model you've talked about historically.
Bryan Kraft: Is this just formalizing the ammo year, you already have or are the terms.
Speaker Change: And is there any impact on the $20 million in prepaid revenue that you'll be getting from AT&T. Later this year in other words will there be additional prepaid.
Speaker Change: Prepaid revenue that maybe it's coming in as part of this agreement. Thank you.
Abel Avellan: Yeah, well, first of all, I'm super, super happy with having to complete a definitive agreement with AT&T. This is a long-awaited project for us.
Speaker Change: Yeah, well first of all I'm Super Super happy with having.
To complete a definitive agreement with AT&T.
Abel Avellan: It's the conclusion of all the [inaudible] as they move in and out of connectivity in the U.S. So we have a multitude of packages. We are disclosing that together with AT&T, so I'm not going to be able to disclose the packages, but there are packages where, yes, there's Soyuz 2.0 revenue share, as we historically have these costs. These packages allow users to get text, voice, full broadband internet, and it's priced accordingly depending on the amount of service that the user is willing to pay.
Speaker Change: This was a long call I mean.
Speaker Change: A project for US is the conclusion of all the.
Speaker Change: Dennis.
Speaker Change: Pricing discovering.
Speaker Change: Understanding all of the usage. We believe there is a significant part of the U S. Population that will then will be willing to pay for the service.
Speaker Change: Are they moving and I won't go into DVD.
Speaker Change: In the U S.
Speaker Change: So we have.
Speaker Change: Uh huh.
Speaker Change: Digital packages.
Speaker Change: We are disclosing that together with AT&T, so I'm not going to be able to disclose the packages about their packages, where it gets you to a revenue share we historically have.
Speaker Change: These costs.
Speaker Change: These packages allow allow users to get text voice full broadband internet and price accordingly, depending on the amount of a mono series of the user is willing to pay.
Abel Avellan: It is designed to be used everywhere in North America and to offer a broadband experience, although how much of that broadband experience depends on how much the user is paying. It's frictionless, so the user doesn't need any special phone, doesn't need any special package. It will be all that he will see is a broadband experience. It's a different symbol in the 5G icon with an S, something similar that indicates that you're on satellite.
Speaker Change: It is designed to be used everywhere in North America.
Speaker Change: And to offer our broadband experience.
Speaker Change: On how much of that broadband experience, it's been almost a use of his baby.
Speaker Change: Is friction less so the user doesn't need any special phone this doesn't need any special.
Speaker Change: The package it will be or what all what he will cease.
Speaker Change: So.
Speaker Change: It's a different symbol in the Indy five icon.
Speaker Change: We don't Miss.
Speaker Change: Something similar.
Speaker Change: <unk> indicated that your own satellite, but other than that the use of us need to do anything so so.
Abel Avellan: But other than that, the user doesn't need to do anything. So we're very excited about this. AT&T has done a significant amount of market research on how to price it together with us and how to position it in order to maximize the take on the service. Thanks.
Speaker Change: We're very excited about these AT&T have own significant amount of market studies or how to price it together with us.
Speaker Change: On how to how to position it in order to maximize the stake on the service.
Bill: Thanks, Thanks, Bill anything on the on the prepaid revenue is it still just the $20 million or I. Just was curious if there was any incremental financing how long from that and then I guess the other follow up I had is just.
Brian Craft: Anything on the prepaid revenue; is it still just 20 million or so?
Brian Craft: So, is it still just the $20 million, or I was curious if there was any additional financing coming from this. And, then, I guess the other follow-up question I had is, just, can you give us a sense as to when you think the service will actually be available. You know, will it, you know, will that be sometime next year, or, you know, how are you thinking about that? Sure, I'll jump in.
Speaker Change: Can you give us a sense as to when you think the service will actually be available.
Speaker Change: Will it.
Speaker Change: Will that be sometime next year or are you thinking about that.
Scott Wisniewski: First on the deal structure, I think Abel walked through some of the finer points, but this is a term through 2030; this is a definitive agreement, which means that it's a document that's the legal vehicle through which revenue will be brought in with all the detailed SLAs and other legal requirements in a real commercial agreement. So it's very powerful from that perspective because it means that both companies have aligned around how this offering will occur in many ways.
Speaker Change: Sure I'll jump in first on the on the deal structure I think about walked through some of.
Speaker Change: Some of the finer points, but you know this is a term through 2030. This is a definitive agreement, which means that it's a document that's the legal vehicle through which revenue will be brought in with with all the detail. That's all A's and other legal requirements and a real commercial agreements. So it's very powerful from that perspective, because it means that both.
Speaker Change: Companies are aligned around how this offering will occur in many ways. So so that's the key element in terms of prepayments.
Scott Wisniewski: So that's the key element. In terms of prepayments, we reiterated the same prepayment that came in in January, right? So there's no new economics with this agreement right now, other than laying out the vehicle through which we'll be able to generate revenue on our SLAs is available, and I'll refer back to Abel's comments on, you know, the go-to-market strategy and doing that jointly with our customer. We're not prepared to run out of the timeline, but as we've said, you know, these five satellites going up are commercial satellites.
Speaker Change: We reiterated.
Speaker Change: The prepayment that came in in January right. So there's no there's no new economics for disagreement right now other than laying out the vehicle through which we will be able to generate revenue when our services is available.
Speaker Change: I'll I'll refer back to <unk> comments on the.
Speaker Change: We go to market strategy and doing that jointly with or our customer we're not we're not prepared to announce the timeline, but as we've said these five satellites going up our commercial satellites to have 10 times the capabilities to Walker <unk> III and <unk>.
Scott Wisniewski: They have ten times the capabilities of Blue Walker 3, and, you know, after several months of preparation, they will be commercial ready, so this is something for us that's technology driven, and we want to get this up as fast as we can. We're using this pie chart like we are.
Speaker Change: After several months of <unk>.
Speaker Change: Preparations there will be commercial ready. So this is.
Speaker Change: It's something for us with technology, driven and we want to get this up as fast as possible.
Abel Avellan: While using these five satellites, we are already... making initial revenue with Gorman, and with Blue Walker 3, they will continue on AT&T and others. Hopefully, it will be closed soon.
Speaker Change: He isn't display satellite we are already.
Speaker Change: <unk>.
Speaker Change: Starting some.
Speaker Change: Initial revenue with your Gorman with Bluewater three.
Speaker Change: They will continue on.
Speaker Change: AT&T and others.
Speaker Change: Hopefully we can close soon.
Abel Avellan: We'll start using these five satellites as commercial operating satellites. Of course, that revenue... plans to increase significantly as we add more satellites, but we will start monetizing these satellites commercially in the U.S. and in other key regions as we continue progressing and signing definitive agreements with the operators. And those definitive agreements, we expect them to have prepayment features that are a key part of how we can continue financing the Constellation.
Speaker Change: We will start using these lifestyle they sell some commercial some commercial operating satellites.
Speaker Change: Of course that revenue.
Speaker Change: Planned to increase significantly we have most sizes, but we will start.
Speaker Change: Monetizing these satellites commercially in the U S and in other key regions.
Speaker Change: We continue.
Speaker Change: Progressing.
Speaker Change: On <unk>.
Speaker Change: Signing definitive agreements with the operators.
Speaker Change: Those definitive agreements.
Speaker Change: We expect them to do a prepayment features that are a key part of how we keep continue financing the constellation.
Speaker Change: Yeah.
Okay. Thanks very much.
Operator: Thank you. Our next question comes from the line of Andres Coelho with Sculpture Bank. Please proceed with your question.
Speaker Change: Thank you. Our next question comes from the line of Andres Coello with Scotiabank. Please proceed with your question.
Andres Coelho: Yes, thank you for taking my question. You just mentioned other regions. I guess that if the five satellites cover the United States, they can also cover parts of Europe, perhaps Japan, perhaps part of northern Mexico. So I'm just wondering if covering the U.S. also gives you capabilities in other parts of the world for these five satellites. Thank you.
Andres Coello: Yes. Thank you for taking my question.
Andres Coello: As mentioned all the regions I guess that is the.
Speaker Change: Satellites will cover the United States. They can also cover parts of Europe.
Speaker Change: Japan, perhaps part of that northern Mexico, So I'm just wondering <unk>.
Speaker Change: Covering the U S. Also gives you a capability in other.
Speaker Change: Parts of the world for the five satellites. Thank you.
Abel Avellan: You know, that is correct. I mean, these five satellites have are inclined at 53 degrees of inclination. What they mean is they pass, they circle the Earth constantly, and they cover everything plus minus 59 degrees of latitude. That's from Canada all the way to Argentina in the Americas, from..., from South Africa all the way to Northern Europe and Japan. So, yes, these sadly have global coverage. We're starting with five. We are, you know, we're very careful of where we start initiating services with customers; we're prioritizing customers that are signing definitive agreements with prepayments, but we have the ability to do that globally, in the U.S., in Europe, in Africa, in Asia, and that's how we're prioritizing the usage of these very valuable assets.
Speaker Change: Yes that is correct I mean, these five satellite have their inkjet a 53 real inclination when they mean Ts they bus they they circle E L F.
Speaker Change: Constantly they cover everything plus <unk> plus minus <unk> 50, 359 degrees of latitude us from Canada, all the way to Argentina in the Americas from.
Speaker Change: From from.
Speaker Change: <unk> South Africa, all the way to northern Europe, and Japan, So yes.
Speaker Change: To help global call rich.
Speaker Change: We're starting with Fyfe, we are you know where we.
Speaker Change: Very careful where we are.
Speaker Change: You start initiating services.
Speaker Change: With customer we're prioritizing customers.
Speaker Change: R E signing definitive agreements with.
Speaker Change: Prepayments.
Speaker Change: But we have the ability to do that globally in the U S. Europe.
Speaker Change: In Africa in Asia.
Speaker Change: That's how we're prioritizing the usage of all of these very valuable assets.
Andres Coelho: Understandable. I'm just confirming that it's going to be a string of pearls, correct? The configuration is going to be a string of pearls.
Speaker Change: Understood and just confirming its ability.
Speaker Change: Single parents, correct that the configurations than any single firms.
Abel Avellan: In the beginning, yes, if we add more satellites, we're going to be phasing them out in the planes where we're putting them.
Speaker Change: At the beginning yes, we add more satellite we're going to be we want to be facing them out.
Speaker Change: In the in the Plains, where we're putting them on.
Speaker Change: Okay. Thank you.
Operator: Thank you. Our next question comes from the line of Chris Schoell with UBS. Please proceed with your question.
Speaker Change: Thank you. Our next question comes from the line of Chris Shaw with UBS. Please proceed with your question.
Christopher Joseph Schoell: Great, thank you for taking the questions. Just a few follow-ups. As you think about measuring success on the first five Block.1 satellites, any guardrails you can give in terms of expected revenue generation and over what time frame? And then, on the second question, historically, we've seen wireless carriers bundle value-added services into their premium offerings. Do you think a similar hard bundle approach could be taken with your service, or do you still expect that customers will need to opt in?
Christopher Joseph Schoell: Great. Thank you for taking the questions just a few follow ups as you think about measuring success on the first five block one satellites any guardrails you can give in terms of expected revenue generation and over what timeframe.
Abel Avellan: [inaudible]
And then second question historically, we've seen the wireless carriers bundled value added services into their premium offerings do you think a similar hard bundle approach can be taken with your service or do you still expect that customers will need to opt in.
Abel Avellan: We are basing our offering as an add-on service to the user. Of course, every country, every operator has their own plan and their own methodology of how to monetize the service and how to differentiate it in each of the respective markets. Fundamentally, this is an add-on service with very low friction to opt-in and start paying. The customer, as I said earlier, doesn't need to basically know anything other than that he's out of connectivity and that he's willing to pay for getting that connectivity.
Christopher Joseph Schoell: We are we're basing our our offering you some odd.
Christopher Joseph Schoell: <unk> service.
Christopher Joseph Schoell: The user.
Christopher Joseph Schoell: Of course every country every operator will have their own plan.
Christopher Joseph Schoell: On the old methodology of how to monetize the service to differentiated in each of the affected markets but.
Christopher Joseph Schoell: Fundamentally this is an add on service.
Christopher Joseph Schoell: We had a very low friction to to opt in.
Christopher Joseph Schoell: And stop paying for it.
The customers as I said earlier doesn't need to basically not anything.
Christopher Joseph Schoell: The order does ease auto connectivity in that are willing to pay for getting that connectivity.
Abel Avellan: So if you think about it, you get your monthly bill; it's a line item in your monthly bill that will be a spacemobile as you move around the Earth in places where there's no connectivity or the connectivity is not good enough.
Christopher Joseph Schoell: So you think about it you get your monkey wheel is a line item in your monthly and that it would be it's based model.
Christopher Joseph Schoell: As you move on roam around around the area.
Christopher Joseph Schoell: In places, where there's not going to do it or they're going to do it is not good enough.
Christopher Joseph Schoell: And just to follow up, maybe just on the first five satellites, any sort of guardrails you're thinking of in terms of revenue generation and how quickly that can scale into the end of this year? Hey, Chris.
Speaker Change: Okay, and then just a follow up maybe just on the on the first five satellites any sort of guardrails youre thinking of in terms of the revenue generation and how quickly that can scale on to the end of this year.
Scott Wisniewski: Hey, Chris. We're not going to be providing revenue guidance at this time, but, you know, these first five satellites are commercial ready. We've talked about our government customer. Obviously, we announced a commercial agreement today.
Chris: Hey, Chris.
Chris: We're not gonna be providing revenue guidance at this time, but this first time satellites, our commercial ready.
Speaker Change: We've talked about our government customer, obviously, we announced a commercial agreement today.
Scott Wisniewski: You know, there's revenue potential that's real for these first five satellites. But again, that's not our focus, right? We believe that the big opportunity is as we scale the system. So, to a certain extent, we're not focused on the revenue opportunity for the first five, but you'll start to see it come in. But, you know, you'll see our focus be on what service looks like with more satellites. And that's, I'll point you back to the agreement today, is all about how do you provide a mass market solution to a broad consumer base, right?
Speaker Change: Or is revenue potential that's real on its first <unk> satellites, but again, it's not our focus right. We believe that the big opportunity because as we scale the system. So to a certain extent, we're not focused on the revenue opportunity for the first five but you'll start to see it come in but you'll see our focus beyond what a service look like with more satellites and Thats point you back to the agreement today.
Speaker Change: <unk> is all about how do you provide a mass market solutions to a broad consumer base right and that's that's where the focus will be thats, where the big revenue opportunities for us.
Scott Wisniewski: And that's what the focus will be. That's where the big revenue opportunity is for us. And so, we won't be as focused on just the first five. We'll be focused on continuing to build up the constellation.
Speaker Change: So we won't be as focused on just the first five will be focused on continuing to build out the constellation.
Speaker Change: Okay, great. Thank you.
Operator: Thank you. And our next question comes from the line of Chris Quilty with Quilty Space. Please proceed with your question.
Christopher David Quilty: Thank you and our next question comes from the line of Chris Quilty with Quilty space. Please proceed with your question.
Christopher David Quilty: All right, gentlemen. I was hoping you could give an update on your ASIC development.
Christopher David Quilty: Alright, gentlemen, I was hoping you could give an update on your ASIC development.
Abel Avellan: Yeah, yeah, Chris, I mean, we're in, we have been in tape out for, for a month and a half already. It's a process of around three months, three to four months.
Speaker Change: Yeah, Yeah, Chris I mean, we are we have been to tape out for four.
Speaker Change: Most of them have already.
Speaker Change: The proceeds will run three months three to four months.
Speaker Change:
Abel Avellan: We are ready to receive our chip. This chip will have another 10 times increase in the processing capacity of our satellites. As a reminder, Blue Walker 3 had 100 megahertz of processing bandwidth. Block 1, the satellites that we have now, that we are planning to launch very quickly here. They had a 10 times higher DAC capacity using FPGAs, and with the next generation of the block tools, we had another 10 times increase to a 10 GHz processing bandwidth per satellite. So that is a very significant step up. We have the ability to keep using our FPGAs for as long as needed, but we are in the tail end process of receiving our data.
We are ready to placebo where chip.
Speaker Change: These cheap.
Speaker Change: Have another 10 times increase in the processing capacity of our satellites as a reminder, the Walker three had.
Speaker Change: Honda megahertz of processing and bandwidth.
Speaker Change: Blog wound he satellites that we have now.
Speaker Change: We're planning to launch very quickly here.
Speaker Change: It had a 10 times dock capacity.
Speaker Change: Using <unk> on.
Speaker Change: The next generation of the block tools, we had another 10 times increase.
Speaker Change: Is it what 10 gigahertz of process the bandwidth per satellite.
Speaker Change: So very significantly.
Speaker Change: Ill step up on.
Speaker Change: But where we're using.
Speaker Change: The ability to keep confusing with P. H four alone as needed.
Speaker Change: But we are in the tail end process of receiving our chip.
Christopher David Quilty: Great. And on the operating expenses, looks like you've made some nice reductions. Is the current quarter a good run rate, or are some of the cost-cutting effects going to accrue, you know, as the year plays out? I'll take that.
Speaker Change: Great and on the operating expenses it looks like you've made some nice reductions is the current quarter, a good run rate or some of the cost cutting effects owing to accrue.
As the year plays out.
Speaker Change: I'll take that.
Speaker Change: Yes.
Sean Robert Wallace: Yeah, Sean. Why don't you pick it up? Yeah.
Sean Robert Wallace: Yes, Sean Williams.
Sean Robert Wallace: Yeah, as we mentioned in March, we are going to probably average somewhere around $30 million. We came in a little over $31 million for. I guess the one caveat is there's $15 million of expenses that can be paid for but haven't been run through the income statement on ASIC. But we have broken it into R&D, engineering services, and GA and will keep it around a $30 million run rate probably through the end of the year.
Sean Robert Wallace: Yes.
Sean Robert Wallace: You mentioned in March we are going to probably average somewhere around $30 million, we came in a little over $31 million.
Sean Robert Wallace: <unk> is just the one caveat is there was $15 million of expenses that we paid for but haven't been run through the income statement on any sick, but we have targeted to R&D engineering services, and <unk> and keep it around $30 million run rate probably through the end of the year.
Christopher David Quilty: Great, and Abel, did you get a picture with Ben Stiller? Ha, ha, ha.
Sean Robert Wallace: Great.
Speaker Change: <unk> did you get a picture with Ben Stiller.
Abel Avellan: Well, we want to invite our investors to the launch. Let's see, let's see who's available.
Speaker Change: Well, we want to invite all of our investors.
Speaker Change: Lunch and.
Let's see let's see he's away at them.
Speaker Change: Alright. Thank.
Speaker Change: Thank you gentlemen.
Operator: Thank you. At this time, I'm showing no further questions. I would like to turn the call back over to management for a closing remark.
Speaker Change: Thank you at this time I'm showing no further questions I would like to turn the call back over to management for closing remarks.
Abel Avellan: Thank you, operator. Our company is building a space-based cellular broadband network designed for the use of the phone in your pocket today.
Speaker Change: Thank you operator, our company is building a space based cellular broadband network designed for the use of the phone in your pocket today I want to thank everyone for joining both the shareholders and analysts for their questions and hope everybody has a great rest of the week. Thank you.
Abel Avellan: I want to thank everyone for joining us, both the shareholders and the analysts, for their questions. I hope everybody has a great rest of the week. Thank you.
Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.
Speaker Change: This concludes today's conference and you may disconnect. Your lines at this time. Thank you for your participation.
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Speaker Change: Okay.
Speaker Change: [music].