Q1 2024 Globalstar Inc Earnings Call
Operator: Good afternoon, ladies and gentlemen, and welcome to the GlobalSTAR 1Q2024 earnings conference call. At this time, all lines are in a listen-only mode.
Good afternoon, ladies and gentlemen, and welcome to the Globalstar, one Q 'twenty 'twenty four earnings conference call. At this time all lines are in a listen only mode. Following the presentation. We will conduct a question and answer session. If at any time. During this call you require immediate assistance.
Operator: Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, May 8, 2024. I would now like to turn the conference over to Rebecca Clary, CFO. Please go ahead.
Speaker Change: Please press Star Zero 40, operator this call is being recorded Wednesday may eight 2024.
Operator: I'd like to turn the conference over to Rebecca Clary CFO. Please go ahead.
Rebecca S. Clary: Thank you, operator. And good afternoon, everyone.
Rebecca S. Clary: Thank you operator, and good afternoon, everyone.
Rebecca S. Clary: After my prepared remarks, Jay Monroe, Executive Chairman and Kyle pick N V. P of strategy will join the question and answer session.
Rebecca S. Clary: After my prepared remarks, Jay Monroe, Executive Chairman, and Kyle Pickens, VP of Strategy, will join the question and answer session. Please note that today's call contains forward-looking statements intended to fall within the safe harbor provided under the securities laws. Factors that could cause the results to differ materially are described in the forward-looking statements and risk factors section of Globstar's SEC filings, including its annual report on Form 10-K for the financial year ending 2023 and its other SEC filings, as well as today's earnings release. To start, Paul is not able to join today's call.
Rebecca S. Clary: Please note that today's call contains forward looking statements intended to fall within the Safe Harbor provided under the securities laws.
Rebecca S. Clary: Actors that could cause the results to differ materially are described in the forward looking statements and risk factors section of Globalstar SEC filings, including its annual report on Form 10-K for the financial year, ending 2023, and its other SEC filings as well as today's earnings release.
To start Paul is not able to join today's call. Unfortunately, his mother passed away yesterday and he is focusing on his family we send our condolences to the Jacobs family and also to the family as Board member, Mike Lovett, who unexpectedly passed away two weeks ago.
Rebecca S. Clary: Unfortunately, his mother passed away yesterday, and he is focusing on his family. We send our condolences to both the Jacobs family and also to the family of board member, Mike Lovett, who unexpectedly passed away two weeks ago. We are extremely grateful for Mike's valuable contribution to our company during his time serving on the board. While it is a sad time for the Globstar team on a personal level, business has been encouraging. Today we are announcing our first quarter results and providing operational highlights. We included a substantial update in the earnings release, so we will keep the prepared remarks section of this call brief.
We are extremely grateful for my ex valuable contribution to our company. During his time served on the board.
Well it is a sad time for the all star team on a personal level business has been encouraging.
Today, we are announcing our first quarter results and providing the operational highlights.
Rebecca S. Clary: A substantial update in our earnings release, So we will keep the prepared remarks section of this call brief.
Rebecca S. Clary: First, we achieved two significant milestones during the quarter, one satellite and one terrestrial. We initiated a contract with a government services company to utilize our satellite network for mission-critical applications. The proof of concept phase is now underway.
Rebecca S. Clary: First we achieved two significant milestones during the quarter, one satellite and one terrestrial we initiated a contract with a government services company to utilize our satellite network for mission critical applications.
Rebecca S. Clary: The proof of concept phase is now underway.
Rebecca S. Clary: Assuming final go-ahead after verification testing, the agreement has a five-year term and contains annual minimum revenue commitments escalating to $20 million during the fifth year, with the potential for significant upside through the agreement's revenue share arrangement. This opportunity represents a creative use of our satellite and spectrum assets, which does not materially utilize capacity we will use for our other customers. On the terrestrial side, we shipped the first commercial units of our EXCOMM RAN last month, an enormous accomplishment for our team.
Rebecca S. Clary: You mean final go ahead after verification testing the agreement has a five year term and contained annual minimum revenue commitment escalating to 20 million during the fifth year with the potential for significant upside through the agreements revenue share arrangement.
Rebecca S. Clary: This opportunity represents a creative use of our satellite and spectrum assets, which does not materially utilized capacity, we will use for other customers.
Rebecca S. Clary: On the terrestrial side, we shipped the first commercial units of our ex Com ran last month, an enormous accomplishment for our team.
Rebecca S. Clary: As previously announced, XCOM RAN was chosen by one of the world's largest retailers for a critical deployment. We are hopeful that this is not only the beginning of a larger relationship with this customer but also the first of many more deployments for similar fulfillment management use cases. It is also worth noting that the XCOM team has managed to meet the needs of this customer in over-the-air testing, utilizing a 10 MHz channel, showing gains of 4 to 5 times compared to other small cell deployments. We believe BANNed N53 and XCOM RAN are a powerful combination.
Rebecca S. Clary: As previously announced the ex Com ran was chosen by one of the world's largest retailers for our critical deployment.
Rebecca S. Clary: We are hopeful that this is not only the beginning of a larger relationship with this customer but also the first of many more deployments for similar fulfillment management use cases.
Rebecca S. Clary: Also worth noting that the ex comm team has managed to meet the needs of this customer and over the air testing utilizing a 10 megahertz channel showing gains of four to five times compared to our two other small cell deployments.
Rebecca S. Clary: We believe band and 53 and XCOM ran are a powerful combination.
Rebecca S. Clary: Now turning to our financial results. We reported total revenue of $56.5 million, generated primarily from subscriber and wholesale capacity services, with service revenue up slightly from the prior year's first quarter. However, it's important to remember that the comparable quarter included certain non-recurring service revenue. Excluding this non-recurring item, service revenue would have increased by $3.7 million, or 7%.
Rebecca S. Clary: Now turning to our financial results.
Rebecca S. Clary: We reported total revenue of $56 5 million generated primarily from subscriber and wholesale capacity services with service revenue up slightly from the prior year's first quarter.
Rebecca S. Clary: It's important to remember that the comparable quarter included certain nonrecurring service revenue.
Rebecca S. Clary: Excluding this nonrecurring item service revenue would have increased by $3 7 million or 7%.
Rebecca S. Clary: For subscriber-driven revenue sources, Commercial IoT continues to grow. During the first quarter of 2024, IoT service revenue increased 24% due to higher ARPU and a larger subscriber base. However, subscriber equipment revenue was down $2.7 million from the prior year's quarter due to the timing of commercial IoT and spot device sales.
Rebecca S. Clary: For subscriber driven revenue sources commercially as he continues to grow.
Rebecca S. Clary: During the first quarter of 2020 for Iot service revenue increased 24% due to higher RP and a larger subscriber base.
Rebecca S. Clary: Subscriber equipment revenue was down $2 7 million from the prior year's quarter due to the timing of commercial Iot and spot device sales.
Rebecca S. Clary: In 2023, we recovered from inventory shortages and experienced higher sales as a result of product availability. To illustrate this point, the first quarter of 2023 was a record high for any first quarter in the company's history for both spot and commercial IoT. Moving to other areas of our financial performance, the increase in net loss was driven primarily by non-cash items. After adjusting for these and certain non-recurring items that aren't representative of our core operating business, adjusted EBITDA was $29.6 million, representing a margin of 52%.
Rebecca S. Clary: In 2023 we recovered from inventory shortages and experienced higher sales as a result of product availability.
Rebecca S. Clary: Illustrate this point the first quarter of 2023 was a record high for any first quarter in the company's history for both spot and commercial Iot.
Rebecca S. Clary: Moving to other areas of our financial performance the increase in net loss was driven primarily by noncash items. After adjusting for these and certain nonrecurring items that aren't representative of our core operating business. Adjusted EBITDA was $29 6 million, representing a margin of 52%.
Rebecca S. Clary: Importantly, both total revenue and adjusted EBITDA during the first quarter were higher on a sequential basis as well as compared to the quarterly average of 2023, reflecting variability in revenue throughout the year. Today we are reiterating our full-year revenue and adjusted EBITDA guidance issued in February. We are excited about how 2024 has started and even more so about what is yet to come in the balance of the year.
Rebecca S. Clary: Importantly, both total revenue and adjusted EBITDA during the first quarter were higher on a sequential basis as well as compare to the quarterly average of 2023, reflecting variability in revenue throughout the year.
Rebecca S. Clary: Based on these results and future expectations today, we are reiterating our full year revenue and adjusted EBITDA guidance issued in February.
Rebecca S. Clary: We are excited about how 'twenty 'twenty four has started and even more so about what is yet to come in the balance of the year.
Rebecca S. Clary: Paul, Kyle, Jason Bernstein, and I will be attending conferences on the East and West Coast in the coming weeks, with one presentation being streamed via webcast, so we look forward to speaking with you again soon. I will now turn the call back to the operator for Q&A.
Speaker Change: Paul Kyle Jason Bernstein, and I will be attending conferences on the east and West coast in the coming weeks with one presentation being streamed via webcast. So we look forward to speaking with you again soon.
Rebecca S. Clary: I will now turn the call back to the operator for Q&A.
Rebecca S. Clary: Yeah.
Operator: We will now begin the question and answer session. Should you have a question, please press star followed by 1 on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star. Please press the star followed by the 2. If you're using a speakerphone, please lift the handset before pressing any key. Your first question comes from the line of Simon Flannery from Morgan Stanley. Your line is open. Thank you.
Rebecca S. Clary: We will now begin to question and answers session should you have a question. Please press star followed by one on your Touchtone phone you will hear your problem that you had has been raised should you wish to decline from the polling process.
Operator: Please press star followed by the true if you're using a speaker phone. Please lift your handset before pressing any keys.
Operator: Your first question comes from the line of Simon Flannery from Morgan Stanley. Your line is open.
Simon William Flannery: Oh, Thank you very much good morning, or good evening, our condolences to pulse families comfortable.
Simon William Flannery: Thank you very much. Good morning or good evening.
Simon William Flannery: Our condolences to Paul's family and to Paul. I wonder, Jay, could you talk a little bit about the pipeline, just where we are today versus, and then on the proof of concept, what's the timeline to getting final results from that and having it move into the next phase? And then, finally, any updates on the Constellation would be great. The next one.
Simon William Flannery: I Wonder Jay could you talk a little bit about the pipeline just where we are today versus.
Simon William Flannery: Say three months ago, certainly it seems like there's some good progress here and then on the proof of concept, but what's the timeline to getting final results from that and having it move into the next phase.
Simon William Flannery: And then finally any updates on the constellation will be great.
Simon William Flannery: The next dose selection.
Simon William Flannery: Great.
James Monroe: Hey, Simon, I'm glad to do this in the reverse order, if you will.
Jay: Hey, Simon.
Simon: Glad to do that stick it in the reverse order if you will.
James Monroe: The constellation remains on schedule. We anticipate launching in 2025, as we've conveyed previously. So that is all where it ought to be.
Speaker Change: Ah the constellation remains on schedule.
Speaker Change: <unk> launching in 2025 as we've conveyed previously.
Simon: So that is all all where it where it ought to be.
James Monroe: In terms of the work that we're doing for the proof of concept, that is a study and test that can go on for a few more months, and then it will convert into the full contract. It can convert almost any time that they believe that the service that they're getting has been debugged in a way that they like it, and then they can convert to that service that we talked about before. At the end of that five-year period, either party can, or collectively both parties, can renew the contract so it can last longer, but it is set up fundamentally and initially as a five-year term.
Speaker Change: And in terms of.
James Monroe: The work that we're doing for the proof of concept that is a that is a study.
James Monroe: Test that can go on for a few more months and then it will convert into the full contract.
James Monroe: It can convert almost any time that they believed that the service that they're getting.
James Monroe: Has been debunked in a way that they like it and then they can convert to that service that we talked about before at the end of that five year period, either party can or collectively both parties can renew the contract. So it can last longer.
James Monroe: But it is set up fundamentally and initially as a five year term.
James Monroe: Um, anything else on those two subjects?
Speaker Change: Anything else on those two subjects Simon.
James Monroe: Hum.
James Monroe: No, I think that's fine. And I think the 20 million you're sort of saying that that can be even larger if there is a revenue share component. I don't know if there's anything more you can say about the nature of the service to help us visualize. No, we can't say much about what the actual service is, but what we can say is that we are optimistic that the revenue share component of it is substantial.
James Monroe: No I think that's that's fine and I think the 20 million, you're sort of saying that that can be even larger if there is a revenue share component to that.
James Monroe: If there's any more you can say area that makes up the service to help US there is no I can't we.
James Monroe: It was structured this way for a number of reasons, but we are optimistic that because of the service that's being provided and to whom it's being provided, they'll use it a lot more in a lot of varied ways. So we're pretty optimistic that that will produce additional revenue for us. And then on the pipeline, just the general level of activity. Yeah, Kyle, do you want to take the pipeline?
Kyle Pickens: Kyle, are you on mute? Can you hear me now? Yes, we can hear you.
Kyle Pickens: Sorry about that. I was on my HomePod, and then it switched.
Kyle Pickens: So, yeah, sorry about that. In the pipeline, there are several different components of the pipeline. I don't know if you're referring to XCOM RAN or to BAM53 or to Satellite, but I'll just talk about all of them, I guess. So, on XCOM RAN, the first customer that we're working with, this global retailer that we've talked about, they could keep us pretty busy for quite some time. So, I think that alone is a very substantial pipeline. The other opportunities in MFC, which is this Micro Fulfillment Center where we're spending a decent amount of time, are actually quite large. It's much larger than I would have even thought of the potential market.
Kyle Pickens:
Kyle Pickens: We're also continuing to work with other situations where, I mean, I think one of the areas to focus on is where you have opportunities that are difficult RF environments with large automated machinery moving around. So, you know, think ports where we're already active with Band 53. Think of shipyards and various logistics areas as very good opportunities for us to focus on, and we're spending time there. On broader Band 53 opportunities, you know, we continue to work with the ecosystem like Qualcomm and Nokia and others looking for opportunities.
Kyle Pickens: We're also continuing to work with other situations, where I mean, I think one of the areas to focus on is where you have opportunities that are difficult to RF environments with a large automated machinery moving around so you know think ports, where we're already active with band 53.
Kyle Pickens: I think kind of shipyards and various logistics areas are very good opportunities for us to focus on and we're spending time there.
Kyle Pickens: On broader band and 53 opportunities, we continue to work with the ecosystem.
Kyle Pickens: Qualcomm and Nokia and others are looking for opportunities.
Kyle Pickens: You know, it's similar types of areas where we're focusing, you know, places where there's critical infrastructure, high-value deployments like mines, infrastructure, and ports again. And that, I think, will be growing and building. One of the things that we've been working on is getting more 5G radios, and we're making good progress on that. So, I think that will open up the market for that. And then on the satellite side, the pipeline is, you know, I mean, it's more kind of business as usual. I don't really have anything to highlight there, but the team is working on driving new products into the market, as they always do. Great. Thanks a lot for the conversation.
Kyle Pickens: It's similar types of areas, where we're focusing our places where there's critical infrastructure high value deployments like mines infrastructure ports again and.
Kyle Pickens: And that I think will be growing and.
Kyle Pickens: In building one of the things that we've been.
Kyle Pickens: Working on is getting more five G radios, which we're making good progress on that so I think that will open up.
Kyle Pickens: The market for that and then on the satellite side the pipeline is.
Kyle Pickens: I mean, it's more kind of business as usual I don't really have anything to highlight there but you.
Kyle Pickens: You know where where the team is working on driving new products into the market as they always do.
Operator: Great. Thanks a lot for the cover.
Speaker Change: Great. Thanks, so much for the color.
Operator: Okay.
Operator: Yeah.
Operator: Your next question comes from the line of Mike Crawford from B. O'Reilly Securities. Your line is open.
Operator: Your next question comes from the line of Mike Crawford from B Riley Your Securities. Your line is open.
Michael Roy Crawford: Thank you. Can you talk about what parts of your balance sheet you might be looking to attack first? Is your free cash flow coming, especially as it accelerates with success on XtromRAM and BAN53 licensing?
Michael Roy Crawford: Thank you.
Michael Roy Crawford: Can you talk about.
Michael Roy Crawford: What parts.
Michael Roy Crawford: Does your balance sheet, you might be looking to attack first as your free cash flow does come in especially as.
Michael Roy Crawford: They accelerate with success on.
Michael Roy Crawford: Extra bran and band 53 and licensing.
Rebecca S. Clary: Um, so from a leverage perspective, I'm assuming that's what you're referring to on balance sheet improvement. So that's, as you know, mostly under our service agreements. So we have the 2021 funding agreement, which is recouped or brought down against services that we earn about $8.6 million a quarter. And so that's steadily reducing.
Michael Roy Crawford:
Speaker Change: From a leverage perspective, I'm, assuming that's what you're referring to on balance sheet improvement. So that's <unk>.
Rebecca S. Clary: As you know mostly under our services agreement.
Rebecca S. Clary: 2021 funding agreement, which is.
Rebecca S. Clary: <unk> brought down against service fees that we earn about $8 6 million a quarter.
Rebecca S. Clary: I think the principal outstanding is about $66 million in that range. And then there's the 2023 funding agreement, which is, you know, about 50% of the total capex of our next-generation satellites that will be funded over time. And so, that will be recouped in a similar way to the 2021 funding agreement. And so those, you know, are classified as debt under GAAP because of the terms of the agreements, but kind of substantively treated as deferred revenue in terms of prepayment for service, just in terms of how they get brought down, the principal balance gets brought down. And then the third tranche is, you know, third-party debt in our 13% notes. And I don't think we have any immediate plans to address those.
Rebecca S. Clary: And so that steadily reducing I think the principal outstanding is about $66 million in that range and then there is the 2023 funding agreement, which is about 50% of the total capex of our next Gen satellite that's funded over time.
Rebecca S. Clary: And so and that will be recouped in a similar way to the 2021 funding agreement and so those are classified as debt under GAAP because of the terms of the agreement but.
Rebecca S. Clary: Kind of sustainably treated as deferred revenue in terms of prepayment for service just just in terms of how they got brought down the principal balance gets brought down.
Rebecca S. Clary: They're paid half in PICC, half in cash, and, you know, second lien. So they're at market rate, at least at the time that we entered into them. So that's, you know, leverage is pretty good right now at under four times at the balance sheet date. And I think it's expected to go down over the next couple years. So it's a pretty healthy level. I don't know if that's helpful, Mike, or if you have any follow-up questions.
Rebecca S. Clary: And then the third tranche is true third party debt in our 13% notes.
Speaker Change: And I don't think we have any immediate plans to address those are paid half in tech have in <unk>.
Rebecca S. Clary: Cash and second lien so market rate at least at the time that we entered into them.
Mike: So thats.
Rebecca S. Clary: Leverage is pretty good right now at under four times at the balance sheet date, and I think it's expected to go down over the next couple of years, So it's a pretty healthy level.
Speaker Change: I don't know if thats helpful, Mike or if you have follow up.
Kyle Pickens: Sure, those 13% notes are callable at PAR, I believe, next month. But we'll, yeah, we'll see, and then... Getting back to incorporating Band 53 into XCOM, RAN, is there, what development work remains to be done there, and when will that be a unified solution you can offer to the market?
Mike: Sure those 30% notes are callable at par I believe next March.
Kyle Pickens: But well yeah.
Kyle Pickens: Yes, we'll see and then.
Kyle Pickens: Getting back to <unk>.
Kyle Pickens: Incorporating <unk>.
Kyle Pickens: <unk> hundred 53 into extra room room is theirs.
Kyle Pickens: Development work remains to be done there and when will that be a unified.
Kyle Pickens: Solution, you can offer to the market.
Kyle Pickens: Yeah, as far as the exact technical work that needs to be done, I would defer to Paul. We can do a call with him later on. Originally, the XCOM RAN was based on a radio vendor called Bicells.
Speaker Change: Yes, as far as the exact technical work that needs to be done.
Speaker Change: I would defer to Paul we can do a call with them later on.
Kyle Pickens: Originally the.
Kyle Pickens: The X column ran was based on.
Kyle Pickens: Our radio vendor called bite, though.
Kyle Pickens: We're taking more of that in-house, and so there's some technical work that the team needs to do. They are working on that right now. We think that we'll have some POC-type equipment later this year and then kind of a more full commercial launch shortly after that.
Paul: Where we're taking more of that in house and so there is some some technical work that the team needs to do their.
Kyle Pickens: They are working on that right now.
Kyle Pickens: We think that will have.
Kyle Pickens: Some POC type.
Kyle Pickens: Equipment later this year, and then kind of a more full commercial launch.
Kyle Pickens: Shortly after that.
Kyle Pickens: Okay, thanks Kyle. And then just...
Speaker Change: Okay. Thanks Kyle.
Kyle Pickens: Just.
Kyle Pickens: Going back a couple of years now, there's been instances in the past where you've talked about Perspectives. [inaudible] Customers or deployments. [inaudible] Which have those other opportunities gone away, or are they still there?
Kyle Pickens: Going back a couple of years now theres been instances in the past where you've talked about.
Kyle Pickens: Perspective.
Kyle Pickens: <unk> 53.
Kyle Pickens: Customers are deployments.
Kyle Pickens: Which have those other opportunities.
Kyle Pickens: Gone away or are they still.
Kyle Pickens: And.
Kyle Pickens: <unk>.
Kyle Pickens: Yeah, so that's a good question. So, you know, when we brought Paul and his team on, one of the reasons that, I mean, I can say that I think they're the greatest wireless engineering team that anybody could have. And so, you know, obviously, when we bring them on board, we want to use their strengths and have them look at all the opportunities that we have. And not only are they great wireless engineering minds. They're also great business minds.
Speaker Change: Yes so.
Speaker Change: Good question, so where.
Kyle Pickens: When we brought Paul and team on.
Kyle Pickens: And one of the reasons that.
Kyle Pickens: I mean I.
Kyle Pickens: Can say that I think they are the greatest wireless engineering team.
Kyle Pickens: Then anybody could happen. So obviously when we bring them on we want to use their strengths and have them look at all the opportunities that we have and not only are they great.
Kyle Pickens: Wireless engineering minds. They are also great business lines, I mean, Paul and team built Qualcomm into a very very substantial company.
Kyle Pickens: I mean, Paul and his team built Qualcomm into a very, very substantial company. And so, we wanted them to look at all the opportunities and, you know, it's Paul's company to drive forward and decide, you know, how he wanted to move forward. And so, he looked at all of the opportunities.
Kyle Pickens: And so we wanted them to look at all the opportunities in that.
Kyle Pickens: Paul's company to drive going forward and decide how he wanted to move forward and so he looked at all of the opportunities. There was I think two that we've talked about in the past.
Kyle Pickens: There were, you know, I think two that we've talked about in the past. One of them, we have moved forward on. They, you know, are paying us and will be deploying BAM 53. The other one we have not moved forward with yet. You know, we could potentially do that in the future, but we are not moving forward with them at this moment. We have, instead, focused on the project like Jay was talking about with the government service project. That's, you know, very substantial.
Kyle Pickens: One of them, we have moved forward on.
Kyle Pickens: Are paying.
Kyle Pickens: Paying us and we will be deploying band 53.
Kyle Pickens: The other one.
Kyle Pickens: Not move forward with yet.
Kyle Pickens: We could potentially in the future.
Kyle Pickens: But we are not moving forward with them at this moment, we have you know.
Kyle Pickens: Instead focused on the projects like Jay was talking about with the government service project.
Kyle Pickens: And then, you know, things like the global retailer that we've talked about. So, there are lots of opportunities ahead of us. You know, we're very, as Rebecca ended her prepared remarks, we're very excited about where we're going. But, you know, there's, you know, again, we had to defer to looking at all these opportunities and then grading the ones that we think have the greatest long-term potential for the company overall.
Kyle Pickens: Very substantial.
Kyle Pickens: And then things like the global retailer that we've talked about so there is there's lots of opportunities ahead of us we're very as Rebecca.
Kyle Pickens: And in her prepared remarks on we're very excited about where we're going.
Kyle Pickens: But there's no.
Kyle Pickens: Again, we had the deferred to looking at all these opportunities and then high grading the ones that we think have the greatest.
Kyle Pickens: Long term potential for the company overall.
Rebecca S. Clary: Okay, thank you. And then, final question just relates to the guidance, so what would be the major causes of variance between the low-end and the high-end range of revenue that you've indicated, and are any spectrum license revenues contemplated in that guidance you get?
Speaker Change: Okay. Thank you and then final question just relates to the guidance so.
Rebecca S. Clary: Good.
Rebecca S. Clary: What would be the major causes of variance between the low end and the high end of range of revenue that you've indicated.
Rebecca S. Clary: Are any spec.
Rebecca S. Clary: Spectrum license revenues concentrated in that guidance you gave.
Rebecca S. Clary:
Rebecca S. Clary: The answer is yes to the terrestrial piece, though other things obviously could solidify right in the coming months. We're still somewhat early.
Rebecca S. Clary: The answer is yes to the terrestrial piece.
Rebecca S. Clary: So other things obviously.
Rebecca S. Clary: Solidify right in the coming months, we're still somewhat early.
Rebecca S. Clary: That could make a difference, but as we sit here today, the transactions that we expect to impact revenues are included. And so the variability is just that, right? I mean, we're talking about a lot of new deals and transactions, some of which we have a lot of certainty around the timing and the amounts; others, we don't have as much, right? So as we move into the quarters, like we did last year, we'll tighten that range as appropriate and guide toward or guide towards a particular part of the range.
Rebecca S. Clary: That could make a difference, but as we sit here today.
Rebecca S. Clary: Transactions that we expect to impact revenues are included.
Rebecca S. Clary: And so the variability is just that right I mean, we were talking about a lot of new deals and transactions.
Rebecca S. Clary: Some of which we have.
Rebecca S. Clary: Lot of certainty around the timing and the amounts and others, we don't have as much right. So.
Rebecca S. Clary: As we move into the quarters like we did last year, well, we will tighten that range as appropriate.
Rebecca S. Clary: And guide towards or guide towards a particular part of the ranch.
Speaker Change: Excellent. Thank you.
Speaker Change: Thank you.
Operator: Your next question comes from the line of George Sutton from Craig Holm. Your line is open.
Rebecca S. Clary: Your next question comes from the line of George Sutton from Craig Hallum. Your line is open.
Operator: Thank you. Your deal with the retailer that you mentioned, you're working on certain micro fulfillment centers. That retailer obviously has substantially more facilities. I'm curious what kinds of things need to be done to move them to a much broader audience.
George Frederick Sutton: Thank you.
Operator: Your deal with the retailer that you've.
George Frederick Sutton: You mentioned, you're working on certain micro fulfillment centers that retailer obviously is substantially more.
George Frederick Sutton: Facilities I am curious what.
George Frederick Sutton: What kinds of things need to be done too.
George Frederick Sutton: Move them to a much broader.
Operator: <unk> footprint.
Operator: Okay.
Kyle Pickens: Yeah, so hey, George, there's a couple of things. You know, there are several internal things that they need to get through on some of their development issues. And then as far as, you know, our process is concerned, I think they're really kind of focused on some reliability work, but you know, there's nothing like that in our minds. I mean, we're very confident about the service and product. I think they just need to see it work for longer and get more comfortable with it. But again, all the signs are encouraging so far.
Operator: Yes.
Speaker Change: Hey, George there's a couple of things.
Kyle Pickens: Several internal things that they need to get through on some of their development issues.
Kyle Pickens: And then as far as our process is concerned I think the there.
Kyle Pickens: They're really kind of focused on.
Kyle Pickens: Some reliability work.
Kyle Pickens: But there's nothing that at all.
Kyle Pickens: Our minds I mean, we're very confident about the service and product I think they just need to.
Kyle Pickens: Let's see it work for longer and get more comfortable with it but again.
Kyle Pickens: All the signs are encouraging so far.
Kyle Pickens: So Qualcomm has come up a couple of times on the call and we had talked.
Kyle Pickens: So Qualcomm has come up a couple of times on the call, and we talked several months ago about Qualcomm creating a solution that they would take to market, including Band 53. Can you give us any updates on...
Kyle Pickens: Several months ago about Qualcomm Qualcomm, creating a solution that they would take to market inclusive of band 53 can you give us any updates on that.
Kyle Pickens: Theres progress there.
Kyle Pickens: Yeah, there's definitely progress there. As a lot of you guys are, I mean, we're impatient and obviously trying to push things as fast as we can, but you know, in the end, we're still a relatively small company working with a lot of really large companies. So it's progress, and we keep pushing them constantly, and they've been very, very supportive. So it's definitely progress, and we'll keep driving. Okay. Bye.
Speaker Change: Yes, there is definitely progress there.
Kyle Pickens: You know us.
Kyle Pickens: A lot of you guys are.
Kyle Pickens: We're in patient and obviously trying to push things as fast as we can but.
Kyle Pickens: Again, we're still a relatively small company working with a lot of really large companies.
Kyle Pickens: Its progress.
Kyle Pickens: And we keep pushing them constantly and they've been very very supportive so.
Kyle Pickens: Definitely progress and we'll keep driving.
Kyle Pickens: No language.
Kyle Pickens: And then lastly, a geeky question, which, Kyle, you would be perfect for. I think OTA testing using 10 megahertz gets you 4 to 5x gains. Can you just explain what that means? So, the way that the system works, and as Jay and I tell people all the time, we're often confused for engineers, but we actually aren't. But the way that the system works is that it effectively allows you to get the full capacity of all the radios that you can see in an area.
Speaker Change: I understand and then lastly, geeky question, which Carl you would be perfect for I think.
Kyle Pickens: Hotelier testing using 10 megahertz gets you four to five X gains can you just explain what that means.
Kyle Pickens: Yeah.
Kyle Pickens: So the way that the.
Kyle Pickens: Some work in.
Kyle Pickens: As Jan I tell people all the time, we're often confused for engineers, but we actually aren't.
Kyle Pickens: But the way the system works is that effectively is allowing you to get the full capacity of all the radios that you can see in a in an area.
Kyle Pickens: And so, you know, a lot of times as you add density, not a lot of times, in other situations when you add density of radios, you're increasing the overlapping cells, and then you're – so, you're therefore increasing the noise, and, you know, capacity is a function of the signal to noise ratio. And so, effectively, what they're saying is that, you know, with a 10 megahertz channel and multiple RRUs that you can see, you're getting all of the capacity of all the RRUs. That's basically what it is. That was a very geeky answer. Thank you.
Kyle Pickens: So a lot of times as you add density.
Kyle Pickens: A lot of times in other situations when you add density of radios.
Kyle Pickens: We're increasing the overlapping cells and then Europe, so therefore, increasing the noise.
Kyle Pickens: Capacity is a function of signal to noise ratio.
Kyle Pickens: So effectively what they're saying is that with a 10 megahertz channel and multiple or use that you can see youre getting all of the capacity of all the <unk> are not all but you are getting that.
Kyle Pickens: Kind of linear game.
Kyle Pickens: Capacity as Youre, adding are using.
Kyle Pickens: Basically what it is.
Operator: That was a very geeky answer. Thank you very much. Thank you. Again, if you have questions, please press...
Kyle Pickens: That was a very geeky answer thank you very much.
Operator: Thanks.
Operator: Yeah.
Operator: Okay.
Operator: Again, if you have questions, please press star followed by 1 on your touchtone phone. Should you wish to decline from the polling process, please press star followed by 2. Your next question comes from the line of Jeffrey Goodfellow. Your line is open.
Speaker Change: Again, if you have question.
Operator: Please press star followed by one on your Touchtone. Following should you wish to declines from Napoleon process. Please press star followed by the two.
Operator: Okay.
Operator: Your next question comes from the line of Jeffrey Goodfellow. Your line is open.
Jeffrey Goodfellow: Hi Jay, Jeff Goodfellow here. I'm wondering if I could get some colorful thoughts on two areas. One is the request for comments for the petition of rulemaking by your next Constellation launch provider, SpaceX, who wants to share Globstar's spectrum, apparently, along with some other people and companies. And second. [inaudible] No, we'll just go with that. Thank you.
Jeffrey Goodfellow: Hi, Jay Geoff Goodfellow here I'm wondering if I could get some color colorful thoughts on.
Jeffrey Goodfellow: Two areas one is the request for comments.
Jeffrey Goodfellow: For the petition of rulemaking by.
Jeffrey Goodfellow: Your next constellation launch provider Spacex, who.
Jeffrey Goodfellow: Wants to share.
Jeffrey Goodfellow: Globalstar is spectrum.
Jeffrey Goodfellow: Apparently along with some other.
Jeffrey Goodfellow: People.
Jeffrey Goodfellow: Companies.
Jeffrey Goodfellow: And.
Jeffrey Goodfellow: Second.
Jeffrey Goodfellow: No. We'll just go with that thank you.
Jeffrey Goodfellow: Yes.
James Monroe: Jeff, you know, there's always a process going on at the FCC, and this service that we offer today is now in the hands of millions and millions of users globally, and it provides life-saving services daily, so we are extremely comfortable with where we are at the FCC. And, you know, there's always going to be a little noise in the background there. But the fact is that we've operated for decades with their help, and we'll continue doing what we do today with the help of the FCC. And that's flying satellites. Providing MSS services and Saving Lives, they know that; our partner knows that.
James Monroe: There is always a process going on at the FCC and.
James Monroe: This service that we offer today is now in the hands of milk.
James Monroe: And millions of users globally.
James Monroe: And it provides life saving services daily.
James Monroe: So we are extremely comfortable.
James Monroe: With where we are at the FCC.
James Monroe: And there is always going to be a little noise in the background there, but the fact is that we've operated for decades with their help.
James Monroe: And we will continue doing what we do today.
James Monroe: With the help of the FCC and Thats flying satellites, providing MSS services and saving lives they know that our partner knows that.
James Monroe: and we're very, very comfortable in that working relationship. So we don't expect any changes to the regime that we have. Great, thank you so much.
James Monroe: And.
James Monroe: We're very very comfortable and networking relationships. So we don't expect any changes to the regime that we live with.
Operator: Great. Thank you so much.
Speaker Change: Great. Thank you so much.
Speaker Change: Thank you Jeff.
Operator: Your next question comes from the line of Charles Morris from Greenhouse. Your line is open.
Operator: Your next question comes from the line of Charles Morris from greenhouse your line is open.
Charles Alan Morris: Thank you, good afternoon. Wholesale capacity services were relatively flat year-on-year. What should I infer from that as we look to growth going forward?
Charles Alan Morris: Thank you good afternoon wholesale capacity services were relatively flat year on year.
Charles Alan Morris: What is the what should I infer about that as we look to growth going forward.
Charles Alan Morris: Okay.
Rebecca S. Clary: Yes, thanks for the question, Charles. So we disclosed before the first quarter that 23 included six and a half million dollars of out-of-period revenue, and about half of that was non-recurring in nature. So if you adjust for that, we're up quite a bit. But that's where a lot of the variability that I referred to in my remarks comes into play as far as revenue is concerned.
Charles Alan Morris: Yes, thanks for the thanks for the question Charles.
Rebecca S. Clary: We have disclosed before the first quarter 'twenty three included $6 $5 million of out of period revenue that half of that was nonrecurring in nature. So if you adjust for that we're up quite a bit.
Rebecca S. Clary: But that's where a lot of the variability that I referred to in my remarks remarks comes into play as far as revenue.
Rebecca S. Clary: And that was all on Wholesale Capacity Services. That's six minutes. Got it. Yes. Okay. Yeah, appreciate that. And yeah, thank you. That's it for me. Okay, thank you.
Rebecca S. Clary: And that was on wholesale capacity services that.
Speaker Change: Six months.
Speaker Change: Got it yes, okay I appreciate that and.
Speaker Change: Yes. Thank you I appreciate that that's it for me.
Operator: Okay, thanks for the question.
Speaker Change: Okay. Thanks for the question.
Operator: Yes.
Operator: Your next question comes from the line of Lyman Delano from Beckman and Oliver. Your line is open.
Speaker Change: Your next question comes from the line of women's Atlanta from Dirk Mcmahon Oliver Your line is open.
Operator: Okay.
Lyman Delano: Good afternoon, gentlemen. My question was related to the decline by the FCC of SpaceX's license application for authority in your, you know, LNS band that was turned down at the end of March. So, and you, someone just addressed that a couple of minutes ago. But I was wondering if you could elaborate as to whether it is likely that SpaceX will continue to lobby and line up support for going back to the FCC.
Lyman Delano: Good afternoon gentlemen.
Lyman Delano: My question was related to the decline by the FCC of space axes.
Lyman Delano: The license application for authority in Europe.
Lyman Delano: Alan S band that was turned down at the end of March so in U someone just address a couple of minutes ago, but I was wondering if you could elaborate.
Lyman Delano: As to <unk>.
Lyman Delano: Whether it is likely that Spacex will continue.
Lyman Delano: A lobby and line up support for going back again to the FCC.
Lyman Delano: Jay, you said you were confident about your relationship, but I just would love it if you could reiterate that. And then, after that, related to either a rumor or a report that the Mexican government some months ago was putting your LNS band up for auction in Mexico. And I haven't heard anything more about that, and I wonder if you could elaborate. Lyman, let's take this.
Lyman Delano: Jay You said you were confident about your relationship, but I just would love. It if you could reiterate that and then one small question afterwards related to either a rumor or a report that the Mexican government.
Lyman Delano: Some months back was.
Lyman Delano: Putting up for auction your Alan S band in Mexico, and I Havent heard anything more about that and I Wonder if you could elaborate.
James Monroe: Lyman, let's take the second one first. It would probably make some sense to check in with Barbie at one point or another in that process, but the process is effectively one that we are in the middle of and will participate in, and we're likely the only party that will do that for a number of reasons, but Barbie can give you, of course, a lot more detail on that when the time is right.
Lyman Delano: Lyman, let's take the second one first it would probably make some sense to check in with Barbie at one point or another on that process, but the process is effectively one.
James Monroe: That we are in the middle of and.
James Monroe: <unk> will participate in and we are.
James Monroe: Likely the only party that will do that for a number of reasons, but on Barbie can give you of course, a lot more detail on that when the time is right for you.
James Monroe: On the question about people continuing to, you know, to, auger at the FCC for things, you know, that's, as I said, gone on forever. And there are things that hang around the FCC for long, long periods of time, and nothing ever moves on them.
Speaker Change: Okay on the.
James Monroe: Question.
James Monroe: About people continuing to.
James Monroe: Two.
James Monroe: Auger at the FCC for things.
James Monroe: As I said gone on for ever.
James Monroe: And there are there are things that hang around the FCC for long long periods of time.
James Monroe: And then nothing ever moves on them. So I wouldn't be troubled about that I would go up to 30000 feet and look down.
James Monroe: So I wouldn't be troubled about that. I would go up to 30,000 feet and look down. And given the services that we provide, and now to the millions of users that we provide them to, and then recognize that it's a life-saving service. We are very comfortable that the FCC will continue to do what it has done for Globestar for decades, which is permit us to continue to operate our services, and expand them, as we have in the last years when we did our wholesale arrangement, as we're doing now with the government services thing that we've talked about.
James Monroe: And given the services that we provide and now to the millions of users that we provided to and then recognize that it's a lifesaving service.
James Monroe: We are very comfortable that the FCC will continue to do what it has done for globalstar for decades, which is permit us to continue to operate our services expanded as we have in the last years. When we did our wholesale arrangement as we're doing now.
James Monroe: Now with the government services thing.
James Monroe: We've talked about.
James Monroe: And again, they'll just let us, you know, give us the room that we need in order to fly satellites and save lives. I just think that's the thrust of it. And there can always be stuff in the background, but I don't think it's going to dissuade the FCC from the path that they've been on with us for decades.
James Monroe: And again I will just let us.
James Monroe: Give us the room that we need in order to fly satellites and save lives I just think that's the thrust of it and there can always be stuff in the background, but I don't think its going to dissuade the FCC from the past that <unk> been on with us for decades.
James Monroe: Okay.
Operator: Thank you. Thank you. There are no further questions at this time. Thank you, ladies and gentlemen, for participating. This concludes today's call. You may now disconnect.
Speaker Change: Thank you.
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Speaker Change: Thank you.
Speaker Change: No further questions at this time, thank you ladies and gentlemen for participating. This concludes today's call you may now disconnect.
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