Q3 2024 AST SpaceMobile Inc Earnings Call - Q&A
Good day, and thank you for standing by and welcome to the S. T space Mobile third quarter 2024 business update call. Please be advised that today's conference is being recorded.
Speaker Change: Now I'd like to hand, the conference over to your host today, Scott <unk> President of U S. D C smoking.
Please go ahead.
Scott: Thank you and good afternoon, everyone. Let me refer you to slide two of the presentation, which contains our safe Harbor disclaimer.
Scott: 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.
Scott: Many factors could cause actual events to differ materially from the forward looking statements on this call.
Scott: For more information about these risks and uncertainties. Please refer to the risk factors section of ASC space Mobile to annual report on Form 10-K for the year ended December 31, 2023, with the Securities and Exchange Commission and other documents filed by St's based mobile with the SEC from time to time.
Scott: Also after our initial remarks, we will be starting our Q&A section with questions submitted by our shareholders.
Scott: 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 many of us still experienced gaps in coverage as we live work and travel. Additionally, there are billions of people without cellular broadband and who remain unconnected to the global economy.
The markets. We are pursuing are massive and the problem. We are solving is important in touch with nearly all of us.
Scott: In this backdrop a S T space mobile is building the first and only global cellular broadband network and space to operate directly with everyday on modified mobile devices and supported by our extensive IP and patent portfolio.
Speaker Change: It is now my pleasure to pass over to chairman and CEO of Bell Avalon, who will go through our activities since our last public update.
Speaker Change: Thank you Scott the last few months have been truly amazing for HTS based model, we launched and successfully deployed our first five commercial bluebird satellites into Lowe's at Orbitz. Each one of the largest commercial phase of a ever launch into legal.
Speaker Change: We had accelerated our government and commercial initiative, we become operational.
Speaker Change: We have secured additional loans capacity for up to 60 satellites to start providing continuous service in the U S. Another key global markets.
Speaker Change: Our block one blueberries satellites are now ready to become operational there to size and capacity is a unique advantage and a clear differentiator for our network our ability to deliver standalone broadband coverage globally.
Speaker Change: In the United States, we plan to do this with more than 5000 seats on the sales of premium low band spectrum targeting close to 100% nationwide KOL rich supported by our initial five satellites on a noncompete basis, yeah, we needed to successfully even fall. This largesse Eva satellite is route.
Speaker Change: In our even though they've designed and now with 95% vertical integration strategy, which is supported by our deep and extensive portfolio of patents in the feed both direct to device a market that we pioneered and invented.
Speaker Change: With our blog Wildblue, where it always was.
Speaker Change: We're now moving forward with the ongoing integration with our bottler networks in.
Speaker Change: In the United State well, so file our spacious temporary authority request with the FCC older. We plan to begin beta services in the United States for AT&T and Verizon Our partners will have the full capabilities of our satellites on a non continuous basis across all United States.
Speaker Change: All the key markets globally.
Speaker Change: On the AC from what <unk> initial validation of our novel 85000 chip does represent a competitive advantage to develop over five years equivalent to 159 years.
Speaker Change: Approximately 45 million of development costs.
Speaker Change: Our next generation block to Bluebird powered by our AC got expected to support up to 10000 megahertz with processing bandwidth 10 time improvement of our corn processing bandwidth from each blow one sadly.
Today, we're also announcing new loan service agreement with Blue, Oregon, and its basics.
Speaker Change: The launch of up to approximately 60, sadly from Cape Canaveral, Florida space for station doing 25 and 26.
Speaker Change: These new agreements in place.
Speaker Change: T mobile has acute launch capacity to ultimately deliver continuous dissipate based cellular roadmap service coverage in key markets, including the United States Europe, Japan, the government on older Cid markets globally.
Speaker Change: Blue Oregon's launch vehicle, new blend offer a seven meter ferry enable dwy did pay low volume or five meter class commercial launch systems as he is well suited to launch up to eight of the largest ever block two satellites.
Speaker Change: The new blend launch vehicles planned to become operational this year.
Speaker Change: Alongside Blue oriented as basics. We're also planning our next launch with equal out of India, who will briefly used for the launch of our Blue Walker one.
Taken all together the launch agreements with these three providers and likely others are willing to future give us increased confidence that we can achieve our network deployment goals.
Speaker Change: Additionally, we had recorded several new wins in the government business. We added three new contracts award with the U S government, including being selected by the space Development agency to complete.
Speaker Change: Directly as a prime contractor.
Speaker Change: Scott will discuss this in more detail us well by being selected to participate in <unk> Branco tractor for Goldman program is a significant achievement for a T mobile and a validation of our strategy and dual use technology that could enable a variety of gorman use cases.
Speaker Change: With our successful launch commercial and manufacturing progress you can see that a lot of the key pieces of them.
Speaker Change: Operational Icd's. These big mobile network are now in place I am incredibly proud of the tireless effort for our team and our partners particular over the past several months getting us to this critical point, which he is.
Step, we move closer to achieve our mission of connecting new connected.
Yeah.
Speaker Change: I will now pass to Scott to provide more detail on our commercial typical authority progress.
Scott: Thank you Bill.
Scott: I'd like to take the time to provide a little more detail on our commercialization initiatives, including our government business as well as our regulatory progress.
Scott: Our technical accomplishments to date, including validating our technology and deploying our first five commercial satellite successfully has been a great support for our commercial initiatives, both with our strategic partners Mobile network, operator, new to FTE based mobile and the U S government.
Speaker Change: As Bill mentioned during the quarter, we were selected by the space development agency to compete directly as a prime contractor under the Halo program. The FDA is the department of Defense's constructive disruptor for space acquisition put in place during the first Trump administration with a multibillion dollar budget.
Speaker Change: Our selection enables us to compete directly as a prime contractor to the U S government for the first time rather than a subcontractor.
Speaker Change: This particular program is directly contracted with the SBA and provides us a direct path for accelerated prototype development and the ability to participate on new government programs and acquisitions.
Speaker Change: This SBA contracted their fourth contract award with U S government.
Speaker Change: And several of these contracts could potentially grow to the official programs of record with hundreds of millions of annual revenues alongside important missions for U S National security.
Speaker Change: In brief we believe that our government contract pipeline continues to show strength in the near and medium term with these initial contracts providing clear paths for applications of our unique technology in select use cases with additional use cases to be further developed.
Speaker Change: The outlook here continues to improve and we are aggressively pursuing this business and expect it to be a meaningful contributor of revenue in the years to come alongside our core commercial business.
Speaker Change: On the commercial customer front, we continue to progress conversations with our key partners as well as potential new partners and expect to be able to report more on this front soon.
Speaker Change: Our strategy continues to be to select initial coverage markets globally, among our key partners, including the 45, plus mobile network operators globally, who have a coverage of approximately $2 8 billion existing subscribers.
Speaker Change: On the regulatory front, we continue to advance our approvals.
Speaker Change: In the U S. We have been in front of the FCC regularly with our technology service offering and in orbit network and how it can improve cellular networks for Americans most.
Most recently, we filed for a special temporary authority approval for beta services with our partners in the U S. Leveraging our first five Bluebird satellites building on prior commercial authority, the backhaul and T. T C frequencies.
Speaker Change: You will continue to see additional filings with the SEC, both from us and our partners in the coming weeks and months for both space and ground elements of our network all of which align with the growth of the network reaping the benefits of the FCC rulemaking on supplemental coverage from space.
Speaker Change: I will now pass it over to Andy to walk you through our financial update.
Andy: Thanks, Scott and good afternoon, everyone.
Andy: The third quarter of 2024, and ASD space mobile marked the beginning of our critical transition from a space based cellular broadband company at R&D stage to a full fledged commercial operating company, we've begun to scale, our manufacturing and launch efforts to accelerate our mission building the first.
And only space space cellular broadband network to close the digital divide by connecting the unconnected.
The third quarter was highlighted by our successful launch and subsequent deployment of our five block one bluebird satellites from Cape Canaveral on September 12th each the largest ever commercial communications array to be deployed in low Earth orbit.
Andy: I appreciated the opportunity to meet many of our investors and other stakeholders at that event as they shared in the excitement of the launch.
Andy: The quarter was also significant in our ability to raise capital both through the redemption of public warrants and our continued disciplined use of the at the market facility or ATM.
Both of which I'll touch on more specifically in just a moment.
Andy: Moving to slide nine let's review the key operating metrics for the third quarter on the first chart, we see for the third quarter of 2024, we had non-GAAP adjusted cash operating expenses of $45 $3 million versus $34 6 million in the second quarter.
Andy: non-GAAP adjusted operating expenses excludes certain noncash operating costs, including depreciation and amortization and stock based compensation.
Andy: Adjusting further for our expected Q3 expenses of $10 $1 million related to our proprietary eighths of chip work total adjusted operating expenses were approximately $35 $2 million, which was at the top range of the guidance I gave during our.
Andy: Last earnings call.
Operating expenses, excluding the <unk> expense were up just slightly quarter over quarter, primarily due to one time items of $1 $7 million associated with our block one launch that included certain bonus payments and launch event costs.
Turning towards the second chart on this page our capital expenditures for the third quarter of 2024 or $26 $5 million versus $21 2 million for the second quarter of 2024.
Andy: The figure was made up of capitalized direct materials and labor for our Bluebird satellites and additional facility and production equipment for our 185000 square foot Assembly integration and test facilities in Midland, Texas.
Andy: As expected capital expenditures trended upward in connection with the ramping of our block to Bluebird satellite production.
Andy: And on the final chart on the slide we ended the third quarter with $518 $9 million in cash up from $287 6 million at the end of the second quarter, bringing our cash balance above $500 million for the first time.
Andy: This significant increase in our cash balance from recent prior periods is important for us and providing the ability and the flexibility to move quickly on our strategic objectives, including securing the launch agreements we announced today.
Andy: This quarter end cash balance includes $153 $3 million of net proceeds from public warrant exercises during the quarter and $144 $9 million of cash raised from our ATM facilities in Q3, including $106 $9 million.
Andy: <unk> from our newly created $400 million ATM facility, we announced in early September.
Speaker Change: As the balance Scott detailed during the early fourth quarter, we secured launch contracts with providers to enable us to launch up to approximately 45 blocked to bluebird satellites with options for additional launch vehicles up to approximately 60 block to Bluebird satellites through 2000.
Speaker Change: 25 and 2026.
Speaker Change: We currently expect our average costs of direct materials and launch expense per satellite for our block two constellation to be in the range of $19 million to $21 million an increase from our prior estimate of 16 to 18 million per satellite as a result of actual launch call.
Speaker Change: <unk> recently contracted.
Speaker Change: Despite this increase we feel confident that we are striking the proper and responsible balance between securing ample launched capacity and the desired timeline to augment our efforts to achieve continuous coverage in key markets.
Speaker Change: As we ramp satellite production and launch contract payments to support this planned launch campaign, our capital expenditures will increase as compared to prior quarters, and we expect capex in the range of $100 million in the fourth quarter of 2024.
Speaker Change: We believe the operation of a constellation of twenty-five blocked to Bluebird satellites will enable us to secure additional sources of funding, including potentially generating free cash flows to fund the buildup of the remaining constellation, including additional satellites for those launches recently.
Secured.
Speaker Change: As a result of our successful issuance of equity producing net proceeds in excess of $500 million in late September we triggered a prepayment obligation under our senior credit facility, resulting in the prepayment of the principal amount of $48 $5 million plus accrue.
Speaker Change: Interest and other expenses.
Speaker Change: This obligation was step was established at the time, we entered into this credit facility in August 2023.
Speaker Change: In doing so we have significantly reduced our go forward interest expense.
Speaker Change: We will continue to consider several attractive options for securing future credit facilities. However, our efforts in raising strategic capital, including non dilutive prepayments from our <unk> partners as we ready for service continue to take precedence over traditional credit financing sources.
Speaker Change: Consistent with the first second and third quarters of 2024, we estimate that our adjusted cash operating expenses for the fourth quarter. Excluding some remaining Asa costs will come in within a range of 30 million to $35 million as we continue to scale production.
Speaker Change: <unk> of our block to Bluebird satellites and preparation for our 2025 and 2026 launch schedule.
Speaker Change: We continue to believe efforts to optimize our Opex will result in a run rate at the low end of that range. These figures will vary depending upon manufacturing activity in each period.
Speaker Change: Timing of the changes in our adjusted operating expenditures and capital expenditures as I have just described could be delayed or may not be realized due to a variety of factors.
Speaker Change: I am also pleased to report that our work on a financing package from export credit agencies is progressing nicely and we have now filed the formal application for a long term debt package. If this application is successful we can use the proceeds to source cost effective long term debt.
Speaker Change: Funding of large projects, we will provide updates as appropriate and we will be working with the partner banks and our advisors to refine our alternatives.
Speaker Change: Our employees across the globe continue to work hard to drive value for our shareholders as we ready for full scale commercial operations.
Speaker Change: To deliver the first and only space based cellular broadband network direct to everyday unmodified smartphones.
And with that this completes the presentation component of our earnings call and I'll pass it back to Scott.
Speaker Change: Thank you Andy.
Scott: Before we go into 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.
Speaker Change: Jeff from New Jersey at.
Speaker Change: The company has stated that 45% to 60 satellites are necessary to provide continuous commercial coverage in the U S. How many potential subscribers could those 45% to 60 satellites cover.
Speaker Change: Thank you for the question Jeff.
Speaker Change: 45% to 60 satellites as an important level for us because it allows us to provide continuous service coverage and as you see from the announcement today that's.
Speaker Change: That's how we sized our strategy around launch services and the agreements that we signed.
Speaker Change: This basically gives us the ability to launch those satellites and get to a true consumer mass market service offering.
Speaker Change: With this network of 45% to 60 satellites, we expect to be able to offer a cellular broadband service to many of the most important wireless markets in the world in fact, the most valuable wireless markets in the world, including the United States Europe, Japan, The U S government and other strategic markets that we're in the process of.
Speaker Change: Selecting.
Speaker Change: At a high level with 45% to 60 satellites, we estimate the initial network capacity to be in the hundreds of millions of potential subscribers.
Speaker Change: Sean from California at what opportunities does the hybrid acquisition for proliferated lower or B program present for.
Speaker Change: <unk> D O D.
Speaker Change: Referring to low Earth orbit satellite based services program contract.
Sean California: Hi, Sean.
A halo program as one being used by the space development agency to bring online additional prime contractors for the Vod and evaluate new prototype technologies. So think of this as a standalone program that could generate tens of millions of revenue for us and be a feeder for additional larger programs in use cases.
Sean California: We plan to continue to work with other primes, but becoming a prime contract or having the flexibility to be a prime contractor in the near term and over time. This is a valuable role for the company to be in.
Sean California: In terms of P. Leo This is a program that is meant to buy services to the Vod that are scalable rather than bespoke.
Sean California: And this is exactly how we've designed our system and our offering.
The program has been so successful to date in fact, it was recently announced that they were expanding it from $900 million to $13 billion, yes, that's billions with a b.
Sean California: This is a great example of the extremely positive backdrop that space are experiencing with U S government usage, especially in the cases, where there isn't it's easily consumable scalable offering.
And we expect that <unk> will be a vehicle for purchasing both communications and communication services.
Speaker Change: Tanner from Colorado Act.
Speaker Change: What is the current timeline for delivery of ASIC chips.
Speaker Change: Thank you Tanya for the question guess as a quick clarification we.
Our current focus is actually launch.
Speaker Change: Satellites, either with the AC or D. S. P. A.
Speaker Change: To achieve coverage.
Speaker Change: The AC is a thin time.
Speaker Change: Ne where capacity increase per satellite.
Speaker Change: Which is obviously our longer term VA seek is tape out it bring up.
Speaker Change: Is older initial base of production.
Speaker Change: The next launch would be also with the FDA the.
Same configuration that we have on block one satellites.
Pulls that later 80 25 mid 2025.
Speaker Change:
Speaker Change: To third quarter of 225, we will be including our ASIC.
Speaker Change: Sure.
Subsequent launches.
Speaker Change: Sam from Texas.
Speaker Change: What have you learned from the first five bluebirds manufacturing and launch are the bluebirds responding unexpected.
Speaker Change: Recent launch.
Speaker Change: Yes, we're happy to report that they are actually.
Speaker Change: Operating.
Speaker Change: Assets baked it.
Speaker Change: We're very happy with their performance.
Speaker Change: We are getting ready to light them up.
Speaker Change: He took over nationwide or close to nationwide gold rich in the United States.
Speaker Change: Continuous basis, we thought that with these <unk> satellites.
Speaker Change: On the bluebirds, the bluebirds I mean, our main building block.
Speaker Change: Which is the micron is basically the same.
Speaker Change: The one that we use on block two so getting set up fully vertically integrate the production of that a was a significant learning on a on a very important advancement.
Speaker Change: We're manufacturing capability.
Speaker Change: So that help us to set up our lines and our production lines for block two.
Speaker Change: On the most important part.
Speaker Change: All of the satellite which is the building blocks of them, which is which are the michaels. The other aspect, which is very important we have progress is the we're integrating with these flights out of the way integrating to coordinate work of our network partners, So where we can move part of their systems.
Including the core.
Speaker Change: On integrating that though with some of the network is not a trivial task.
Speaker Change: Vessels in the woodlands.
Speaker Change: All major operator that we had agreements and are going to be starting using our satellites.
Speaker Change: Is it about the blue one the other one which is no trivial.
Speaker Change: <unk>.
Speaker Change: On Blue Walker, <unk>, the operational decided where Barry.
Speaker Change:
Speaker Change: Manuel.
A little.
Speaker Change: People intervention to fly them. These new satellites are fully out of me.
Speaker Change: They fly those dollars really so they did ask me then broadcast cerebral broadband.
Speaker Change: All told us really.
That's also something that having that integrated into <unk>.
Speaker Change: It.
Translate immediately into block so.
Speaker Change: Another lesson learned.
We're in the business that you learn by doing.
Speaker Change: Having been built on flying the largest ever all gets the orange to look at all.
Speaker Change: It is a significant achievement on obviously a significant learning.
Speaker Change: The stay with the company and move on into the next launches.
Speaker Change: Doug will start soon here.
Speaker Change: <unk>.
Speaker Change: And with that I'd like to thank our shareholders for submitting those questions.
Operator, let's open the call to analyst questions now.
Speaker Change: Thank you.
Speaker Change: We will now be conducting a question and answer session.
Speaker Change: I'd like to ask a question. Please press star one on your telephone keypad.
A confirmation tone will indicate your line is in the question queue. You May press star two three questions in the queue.
Speaker Change: Participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.
One moment, please while we poll for question.
Speaker Change: Our first question comes from the line of Mike Crawford with B Riley Securities.
Speaker Change: Please proceed with your question.
Speaker Change: Thank you could you.
Speaker Change: Talk about what Youre doing in Midland down to scale production, how long it takes to build a block one or block two satellite today, and then what that timeframe might look like once you scale up to more forward production.
Speaker Change: Hey, Mike how are you.
Speaker Change: In Midland, we basically have.
The scale up.
Speaker Change: To have the ability to produce the Michael require for block two.
Speaker Change: And then basically meet our target of 60 satellites during 'twenty five 'twenty six.
Speaker Change: We have the on the default investments required for that.
Speaker Change: Hey.
Speaker Change: Basically the same technology that we bid launching block one it would be what it will be used on <unk> block two satellites.
Speaker Change: I see relate to the Michaels for the subsequent block two satellites. So they're basically the same michaels the same infrastructure.
Speaker Change:
Speaker Change: For the next few launches.
Speaker Change: Using our corn.
Speaker Change: Micron studies successfully operating now in Brooklyn.
Okay. Thank you just one more for me.
Speaker Change: One of your strategic partners rocket 10, and that's third quarter.
Speaker Change: <unk> presentation.
Typically.
Speaker Change: They did that they aim to provide a nationwide coverage with I S. T space mobile starting in 2026.
Speaker Change: When should we expect to see a definitive agreement with Rocky Chen.
Speaker Change: We have.
Speaker Change: In agreement with Rakuten already they are an investor.
Speaker Change: On a network operator, we also working very hard with them.
Other in country applications.
Speaker Change: For the for the Japanese market, but we are already.
Speaker Change:
Speaker Change: It is fully engaged with them on.
Speaker Change: We were loading them to be.
Speaker Change: One of the first markets after the United States Europe.
Speaker Change: On Japan.
Speaker Change: Okay. Thank you very much.
Thank you.
Speaker Change: Our next question comes from the line of Chris Shaw.
So with UBS. Please proceed with your question.
Speaker Change: Okay, great. Thank you just a follow up on the launch services agreement any color you can give on the cadence for the 60 satellites potentially being launched and is it fair to assume it will be backend loaded and I believe the new Glenn rocket had been delayed previously can you just talk through what gives you confidence he will not see further delays and youre backup options, India that new Glenn falls behind schedule.
Speaker Change: Thank you.
Yeah, So I mean as you know.
Speaker Change: If there's something what we what we announced is a multi launch agree with multiple butters.
Speaker Change: Including the Spacex Israel.
Speaker Change: The new glass from Blue, Oregon.
Speaker Change: The ability to actually stock multiple satellites, all the way to eight and the new blend which is <unk>.
Speaker Change: Roughly double what is possible and the Falcon nine.
Speaker Change: New Glenn <unk>.
Speaker Change: Ready to launch this year.
Speaker Change: And we're working with them basically accelerating our launch campaign.
Speaker Change: In order to take advantage of the large ferring.
Speaker Change: Two stock a significant number of satellites as I said up to up to eight with them.
Speaker Change: So we will the cadence will be probably one four.
4888.
Speaker Change: Until we get to 60.
Speaker Change: On the new lending designed to be we used 25 times.
Speaker Change: The multitude of them being built.
Hum.
Speaker Change: With the first one is scheduled to actually be this year.
Speaker Change: Great. Thank you for that and if I could just spend one more any thoughts on how space policy or regulation could evolve under the new administration I appreciate it's still early days, but.
Speaker Change: Love to hear potential impacts here thinking about for your business. Thank you.
Speaker Change: Well, we believe that these common administration will maintain.
Speaker Change: What it did in the first administration, where the FDA was created a lot of funding into into into space was granted we believe that it would be an environmental growth for the space sector.
Speaker Change: We solve a major problem, which is the ability to provide broadband connectivity in every corner of the United States The Dod Isa <unk>.
Speaker Change: Bypass it biparty submission.
Speaker Change: We think that there would be a significant support for that for that for that initiative.
Speaker Change: In the incoming administration, we also believe that we're gorman opportunities become more relevant.
Speaker Change: Hum.
Speaker Change: We see we see.
A very good path here.
Speaker Change: That's basically what we saw happen in the first illustration from.
Speaker Change: Four years ago.
Speaker Change: Great. Thank you very much.
Thank you.
Speaker Change: Our next question comes from the line of.
Speaker Change: Chris Quilty with Quilty space. Please proceed with your question.
Speaker Change: Thanks, Scott I think in the script you mentioned the.
Speaker Change: Potential government revenues in the hundreds of millions of dollars was that.
Speaker Change: Should we assume those are hardware revenues or are those service revenue.
Speaker Change: Hey, Chris.
Those are you know that was the general sizing overtime right, but it speaks to the contracts that we received so there's four contracts awards now.
Speaker Change: And some of those we think are.
Speaker Change: Faith contracts that have a path over time to getting the programs of record to getting to those large figures and that would be.
Speaker Change: They're all primarily services contracts that we contemplate although we have the ability to sell satellites over time I suppose but.
Speaker Change: Primarily we're services business, we're a manufacturer and we make these technologies operational for the U S government for our commercial partners.
Speaker Change: Understand and.
Turned out that the ground networks are often the lowest.
Speaker Change: Lowest component of those of any sort of a network build out.
Speaker Change: Is it fair to assume that would have to be a bespoke government ground system or could.
Could the government use it with existing infrastructure.
Speaker Change: Yes.
Speaker Change: Hum.
Speaker Change: Our our ground infrastructure for the for the existing for the U S. Full green, it's actually pretty much built.
Speaker Change: We are not at Liberty to disclose how the Goldman axis.
Speaker Change: Our network of satellites.
Speaker Change: Well, what I would say they have been using our satellites that have been testing what they can do with them.
Speaker Change: On that.
Speaker Change: About half led of course explained two four agreements.
Speaker Change: Which we believe will be very significant overtime.
Speaker Change: All of them on a dual use set.
Speaker Change: Set up where we have where we're sharing the commercial infrastructure also for Goldman.
Speaker Change: Limitations.
Speaker Change: As long as you deliver the revenues you don't need to explain the technology.
Speaker Change: Yeah.
Speaker Change: Thank you.
Our next question comes from the line of Bryan Kraft with Deutsche Bank. Please proceed with your question.
Speaker Change: Hi, Good afternoon, I had two if I could.
Speaker Change: First could you just talk about the timeline for testing the five satellites you launched in September and putting those into commercial service and then secondly, Scott could you give us a sense of the pipeline and level of activity as it relates to signing new commercial agreements with MFS. Thanks.
Yeah, Let me, let me talk about the four and five satellites actually that they are in operation we have submitted today in SBA.
Soup momentum temporarily authority with the FCC to turn them on for actually data usage.
Uh huh.
Speaker Change: Close to nationwide around the United States.
Speaker Change:
Speaker Change: That is imminent and it would be.
Speaker Change: Bending the authorization to basically.
Speaker Change: And better data services on them from.
Speaker Change: From the FCC, but they are ready to be ready to be operation. They are fully deployed.
They are operating.
We expect them.
Speaker Change: And Brian on the second question.
Speaker Change: We announced the definitive commercial agreement with AT&T.
Speaker Change: And we are working on similar agreements with our other large partners.
Speaker Change: Those are important to have in place before services offered but.
Speaker Change: These are long dented regiments and they are important because they basically are the legal vehicle through which revenue will flow very quickly and so that those are very important steps.
Speaker Change: He's a big agreements that we get right with our partners and and as you may have seen we've recently increased hiring on the commercial front because.
Speaker Change: Yes, the pipeline for these these types of agreements and the interest around them is quite strong in and where our strategy is incentives to go out and harvest of 45 plus agreements that we have today and also talked to additional partners around the world. So that is a that is a good pipeline.
Speaker Change: It's really been supported by the level of activity we've had in 2024.
Speaker Change: Especially this first five satellites and deploying all of them successfully in Orbitz. So that that activity is good and we're going to continue to harvest it.
Speaker Change: Okay, great. Thanks for your bus.
Speaker Change: Thank you. Our next question comes from the line of Canada's Henry with analytics.
Speaker Change: Please proceed with your question.
Speaker Change: Hi, Thanks, Hi, Al Hi, Scott.
Speaker Change: One question sorry, if this has already been answered just a clarification.
Speaker Change: How many block one satellites.
Speaker Change: S T anticipate launching before switching over to the block two.
Speaker Change: Yes.
Speaker Change: We've already switched to block two so the.
Speaker Change: Five.
Speaker Change: Norway, Buffalo, Milwaukee, three R blow one sizes.
Speaker Change: So a metre by either a race.
The the the Knicks.
Speaker Change: The sizes.
Speaker Change: 400 square feet phase III, just broken at three five times bigger than the block one.
Speaker Change: Well, we are launching going forward.
Speaker Change: Okay alright, thank you.
Speaker Change: You also mentioned expecting to see more FCC filings for space and ground segment.
Speaker Change: You've talked a lot about the space side, but can you give any color on what.
Speaker Change: Ground network rollout you need in terms of like how many teleports around the world.
Speaker Change: Where are you progressing to date for commercial service.
Speaker Change: Yeah, we have 4000 stations.
Speaker Change: Two we in operations in the United States.
Speaker Change: Basic to light up 50 seats on the sales in.
Speaker Change: In in in in the U S.
Speaker Change: With that we're turning into Europe and Japan.
Speaker Change: We are basically lining up.
Speaker Change: Regional <unk>.
Speaker Change: We bought a phone for the.
Speaker Change: For the European market.
Speaker Change: Like with any Japan for the Japanese market.
Speaker Change: Hopefully we'll be announcing.
Speaker Change: Alicia lifted.
Speaker Change: Yeah.
Speaker Change: Partners coming in for additional markets that we would be lighting up.
Speaker Change: In conjunction with deals similar to what we have done with AT&T and Verizon are we will then be prioritizing those markets. So we have prototypes in access to the network through satellites.
Net where operators that have either invested or prepay.
Speaker Change: Our services with us.
Speaker Change: But where we're focused in.
In in specific regions or with a lot of folks in United States.
Speaker Change: The first markets.
Speaker Change: Okay. Thanks, and then just one more question. So it sounds like eight satellites can launch per new Glenn for for Falcon nine.
Speaker Change: How many are you anticipating for that that Israel launch and is that with the smaller P. S. L. A V or the larger.
G L V Rod.
Speaker Change: It is with the largest.
Speaker Change: We expect to use that.
Speaker Change: All right.
Speaker Change: First launch.
Speaker Change: The then then focus on the new land and Spacex and others.
Speaker Change: That also.
Speaker Change: Capable of launching our our satellites, but of course well.
Speaker Change: Really very enthusiastic about the new Glenn.
Large.
Speaker Change: Although we need to do launches to eight of the large ones that we have.
Speaker Change: Alright, thanks, guys.
Thank you.
Speaker Change: And we have reached the end of the questionnaire, especially I'll now turn the call back over to <unk>.
Speaker Change: Scott since before closing comment.
Speaker Change: Thank you operator, we want to thank all of our shareholders and research analysts for joining the call and everyone's continued strong support of our mission. We look forward to providing further updates. Thank you.
Speaker Change: And ladies and gentlemen. This concludes today's conference call you may disconnect your lines at this time.
Speaker Change: You for your participation.
Okay.
Speaker Change: [music].
Speaker Change: Yes.
[music].
Speaker Change: Yeah.