Q2 2026 Satellogic Inc Earnings Call

August 5, 2026

Operator: Good afternoon, and welcome to the Satellogic Q2 2026 Financial Results Conference Call. All lines have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. During today's call, management may make statements relating to goals and objectives for the future operations, financial and business trends, business prospects, future financial metrics, customer contracts and pipeline, revenue generation, and expectations for future performance that constitute forward-looking statements under the federal securities laws. Any such forward-looking statements reflect management expectations based upon currently available information and are not guarantees of future performance.

Speaker #1: and welcome to the Satellogic second quarter 2026 financial results conference call. All lines have been placed in a listen-only mode, and the floor will be open for your questions following the presentation.

Speaker #1: During today's call, management may make statements relating to goals and objectives for the future operations, financial and business trends, business prospects, future financial metrics, customer contracts generation, and expectations for future performance that constitute forward-looking statements under the Federal Securities Laws.

Speaker #1: Any such forward-looking statements reflect management expectations based upon currently available information and are not guarantees of future performance. They involve certain risks and uncertainties that are more fully described in Satellogic's SEC filings including the risk factor section of our quarterly report on Form 10-Q for the quarter ended June 30, 2026, our annual report on Form 10-K for the fiscal year ended December 31, 2025, and other filings with the SEC.

Operator: Any such forward-looking statements reflect management expectations based upon currently available information and are not guarantees of future performance. They involve certain risks and uncertainties that are more fully described in Satellogic's SEC filings, including the Risk Factors section of our quarterly report on Form 10-Q for the quarter ended 30 June 2026, our annual report on Form 10-K for the fiscal year ended 31 December 2025, other filings with the SEC. Actual results, performance, or achievements may differ materially from those expressed in or implied by these forward-looking statements. Satellogic undertakes no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this call.

Operator: They involve certain risks and uncertainties that are more fully described in Satellogic's SEC filings, including the Risk Factors section of our quarterly report on Form 10-Q for the quarter ended 30 June 2026, our annual report on Form 10-K for the fiscal year ended 31 December 2025, other filings with the SEC. Actual results, performance, or achievements may differ materially from those expressed in or implied by these forward-looking statements. Satellogic undertakes no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this call. On this call, management will also discuss financial measures not determined in accordance with U.S. GAAP, including EBITDA, adjusted EBITDA, and adjusted operating cash flow.

Speaker #1: Actual results, performance, or achievements may differ materially from those expressed in or implied by these forward-looking statements. Satellogic undertakes no obligation to update or revise any forward-looking statements to the reflect events or developments after the dates of this call.

Speaker #1: On this call, management will also discuss financial measures not determined in accordance with US GAAP including EBITDA, adjusted EBITDA, and adjusted operating cash flow.

Operator: On this call, management will also discuss financial measures not determined in accordance with US GAAP, including EBITDA, adjusted EBITDA, and adjusted operating cash flow. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are presented in the appendix to today's presentation, in the earnings materials posted on the investor relations section of the website. A press release detailing these results was issued this afternoon and is available at satellogic.com.

Speaker #1: Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are presented in the appendix to today's presentation and in the earnings materials posted on the Investor Relations section of the website.

Operator: Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are presented in the appendix to today's presentation, in the earnings materials posted on the investor relations section of the website. A press release detailing these results was issued this afternoon and is available at satellogic.com. Hosting today's call will be Satellogic's founder and Chief Executive Officer, Emiliano Kargieman, and Chief Financial Officer, Rick Dunn. With that, I will now turn the call over to the CEO. Please go ahead, sir.

Speaker #1: A press release detailing these results was issued this afternoon and is available at satellogic.com. Hosting today's call will be Satellogic's Founder and Chief Executive Officer, Emiliano Kargieman, and Chief Financial Officer, Rick Dunn.

Operator: Hosting today's call will be Satellogic's Founder and Chief Executive Officer, Emiliano Kargieman, and Chief Financial Officer, Rick Dunn. With that, I will now turn the call over to the CEO. Please go ahead, sir.

Speaker #1: With that, I will now turn the call over to the CEO. Please go ahead, sir.

Speaker #2: Thank you. Operator and good afternoon, everyone. Welcome to Satellogic's second quarter 2026 earnings conference call. Joining me today is Rick Dunn, our Chief Financial Officer.

Emiliano Kargieman: Thank you, operator. Good afternoon, everyone. Welcome to Satellogic's Q2 2026 earnings conference call. Joining me today is Rick Dunn, our Chief Financial Officer. I'll start with the quarterly results and the commercial wins that drove them, then comment on where contracted Buy-Cloud stands for the balance of this year. Rick will take you through the financials in detail. After that, I'll come back to where this market is going, why we think we're positioned to lead it, and provide an update on Merlin and our infrastructure build-out. I'll close with key takeaways before we open the line for questions. In the Q2, we grew revenue 259% year over year to $15.9 million, generated +operating income and +adjusted EBITDA for the first time in the company's history.

Speaker #2: I'll start with the quarterly results and the commercial wins that drove them, and then comment on where contacted backlog stands for the balance of this year.

Speaker #2: Rick, we'll then take you through the financials in detail. After that, I'll come back to where this market is going, why we think we're positioned to lead it, and provide an update on Merlin and our infrastructure build-out.

Speaker #2: I'll then close with key takeaways before we open the line for questions. In the second quarter, we grew revenue 259% year over year, to $15.9 million.

Emiliano Kargieman: In the Q2, we grew revenue 259% year-over-year to $15.9 million, generated +operating income and +adjusted EBITDA for the first time in the company's history. While revenue grew 259%, operating expenses increased only 46%, demonstrating the real operating leverage of our vertically integrated model. This milestone represents a major step towards sustained profitability and validates the operating leverage we have discussed over the past few quarters. We had four key sovereign and defense wins and milestones as follows.

Speaker #2: Generated positive operating income and positive adjusted EBITDA for the first time in the company's history. And while revenue grew 259%, operating expenses increased only 46%, demonstrating the real operating leverage of our vertically integrated model.

Emiliano Kargieman: While revenue grew 259%, operating expenses increased only 46%, demonstrating the real operating leverage of our vertically integrated model. This milestone represents a major step towards sustained profitability and validates the operating leverage we have discussed over the past few quarters. We had four key sovereign and defense wins and milestones as follows. First, we successfully delivered the first satellite in Portugal's $80 million SEIA program, converting nearly half the program to recognized revenue. Second, we secured and started delivery of an international Aleph Observer agreement with a defense customer valued at more than $18 million, moving from initial trial to full-scale deployment in under six months. Third, in April, we closed a $12 million agreement for the in-orbit delivery and transfer of a commissioned NewSat satellite to a sovereign defense customer. This is the third sovereign transaction we have announced in the past two quarters.

Speaker #2: This milestone represents a major step towards sustained profitability and validates the operating leverage we have discussed over the past few quarters. We had four key sovereign and defense wins, and milestones as follows: First, we successfully delivered the first satellite in Portugal's $18 million SEIA A program, converting nearly half the program to recognized revenue.

Emiliano Kargieman: First, we successfully delivered the first satellite in Portugal's $80 million SEIA program, converting nearly half the program to recognized revenue. Second, we secured and started delivery of an international Aleph Observer agreement with a defense customer valued at more than $18 million, moving from initial trial to full-scale deployment in under six months. Third, in April, we closed a $12 million agreement for the in-orbit delivery and transfer of a commissioned NewSat satellite to a sovereign defense customer. This is the third sovereign transaction we have announced in the past two quarters.

Speaker #2: Second, we secured and started delivery of an international Aleph observer agreement with the defense customer, valued at more than $18 million, moving from initial trial to full-scale deployment in under six months.

Speaker #2: Third, in April, we closed a $12 million agreement for the in-orbit delivery and transfer of a commissioned NUSAT satellite to a sovereign defense customer.

Speaker #2: This is the third sovereign transaction we have announced in the past two quarters. And fourth, we announced a strategic collaborations with Sinmax and SpaceNow to build AI-powered geospatial intelligence products in our platform.

Emiliano Kargieman: Fourth, we announced strategic collaborations with SynMax and SpaceKnow to build AI-powered geospatial intelligence products in our platform. We recognized $22 million in revenue in H1 and ended the quarter with $80.7 million in contracted non-cancellable total remaining performance obligations. Significantly, $45.8 million of that RPO is contracted for realization within the next 12 months. This gives us strong top-line visibility as we continue to convert our growing defense pipeline and lean to the strong global sovereign demand. To ensure we capture this demand, we expanded our sales organization with three senior industry leaders and ramped up satellite production at our Montevideo facility to support our Merlin, NewSat, and NextGen programs alongside sovereign deliveries. During the quarter, we also welcomed retired Lieutenant General Michael E. Williamson to our board as an independent director.

Speaker #2: We recognized $22 million in revenue in the first half of the year and ended the quarter with $80.7 million in contracted non-concillable total remaining performance obligations.

Speaker #2: Significantly, $45.8 million of that RPO is contracted for realization within the next 12 months. This gives us strong top-line visibility as we continue to convert our grown defense pipeline and lean into the strong global sovereign demand.

Speaker #2: To ensure we capture this demand, we expanded our sales organization with three senior industry leaders and ramped up satellite production at our Montevideo facility to support our Merlin, NUSAT, and next-gen programs alongside sovereign deliveries.

Emiliano Kargieman: To ensure we capture this demand, we expanded our sales organization with three senior industry leaders and ramped up satellite production at our Montevideo facility to support our Merlin, NewSat, and NextGen programs alongside sovereign deliveries. During the quarter, we also welcomed retired Lieutenant General Michael E. Williamson to our board as an independent director. Now, before sharing updates on Aleph Observer, the transition to persistent global intelligence, and the build-out of our Merlin constellation, I will hand the call over to Rick to walk you through the financial details. Rick?

Speaker #2: During the quarter, we also welcomed retired Lieutenant General Michael E. Williamson to our board as an independent director. Now, before sharing updates on Aleph Observer, the transition to persistent global intelligence and the build-out of our Merlin constellation I will hand the call over to Rick to walk you through the financial details.

Emiliano Kargieman: Now, before sharing updates on Aleph Observer, the transition to persistent global intelligence, and the build-out of our Merlin constellation, I will hand the call over to Rick to walk you through the financial details. Rick?

Speaker #2: Rick?

Speaker #3: Thank you, Emiliano, and good afternoon, everyone. Today's geospatial data market is supply constrained. With customers demanding significantly more data at lower costs, and because we operate one of the largest high-resolution constellations in the world, we benefit from considerable operating leverage.

Rick Dunn: Thank you, Emiliano, and good afternoon, everyone. Today's geospatial data market is supply-constrained, with customers demanding significantly more data at lower costs. Because we operate one of the largest high-resolution constellations in the world, we benefit from considerable operating leverage. By utilizing our existing in-orbit fleet capacity and fully leveraging our cost leadership, we're well-positioned to capture this demand. Q2 and H1 2026 mark a structural and financial inflection point for Satellogic. Starting with revenue, total revenue for Q2 was $15.9 million, up 259% year-over-year. For H1 2026, total revenue reached $22 million, representing an increase of 181% compared to $7.8 million in H1 2025. Looking at our Q2 business lines, space systems contributed $8.8 million or 55% of revenue driven by sovereign satellite deliveries.

Speaker #3: By utilizing our existing in-orbit fleet capacity and fully leveraging our cost leadership, we're well positioned to capture this demand. The second quarter and the first half of 2026 mark a structural and financial inflection point for Satellogic.

Rick Dunn: Q2 and H1 2026 mark a structural and financial inflection point for Satellogic. Starting with revenue, total revenue for Q2 was $15.9 million, up 259% year-over-year. For H1 2026, total revenue reached $22 million, representing an increase of 181% compared to $7.8 million in H1 2025. Looking at our Q2 business lines, space systems contributed $8.8 million or 55% of revenue driven by sovereign satellite deliveries.

Speaker #3: Starting with revenue, total revenue for the second quarter was $15.9 million up $259% year over year. For the first six months of 2026, total revenue reached $22 million, representing an increase of $181% compared to $7.8 million in the first half of 2025.

Speaker #3: Looking at our Q2 business lines, space systems contributed $8.8 million or $55% of revenue driven by sovereign satellite deliveries. Data and analytics contributed $7.1 million or $45% of revenue as customer subscriptions for persistent monitoring expanded.

Rick Dunn: Data and analytics contributed $7.1 million or 45% of revenue as customer subscriptions for persistent monitoring expanded. We also expanded our geographic reach across our sovereign and defense customer base. Europe led Q2 at 58% of revenue, or $9.2 million, driven by SIA delivery. The Middle East and North Africa contributed $3.6 million or 22% of revenue, while the Americas generated $2.3 million or 14% of revenue, and Asia Pacific represented $900,000 or 6% of revenue. Turning to margins and cost structure, we delivered these results with an 82% gross margin in Q2, exclusive of depreciation. Total operating expenses were $15.7 million, up 46% in comparison to the 259% revenue growth, highlighting the operating leverage inherent in our vertically integrated model. This operating leverage drove profitability metrics for Satellogic as follows. First, we achieved positive quarterly operating income of just over $300,000 for the quarter.

Speaker #3: We also expanded our geographic reach across our sovereign and defense customer base. Europe led the second quarter at 58% of revenue or $9.2 million driven by SEIA delivery.

Speaker #3: The Middle East and North Africa contributed $3.6 million or $22% of revenue while the Americas generated $2.3 million or $14% of revenue and Asia Pacific represented $900,000 or 6% of revenue.

Speaker #3: Turning to margins and cost structure, we delivered these results with an 82% gross margin in the second quarter exclusive of depreciation. Total operating expenses were $15.7 million up $46% in comparison to the $259% revenue growth, highlighting the operating leverage inherent in our vertically integrated model.

Rick Dunn: Turning to margins and cost structure, we delivered these results with an 82% gross margin in Q2, exclusive of depreciation. Total operating expenses were $15.7 million, up 46% in comparison to the 259% revenue growth, highlighting the operating leverage inherent in our vertically integrated model. This operating leverage drove profitability metrics for Satellogic as follows. First, we achieved positive quarterly operating income of just over $300,000 for the quarter.

Speaker #3: This operating leverage drove profitability metrics for Satellogic as follows: First, we achieved positive quarterly operating income of just over $300,000 for the quarter. Second, we delivered positive adjusted EBITDA of $2.8 million for the quarter, both of these are first for the company.

Rick Dunn: Second, we delivered positive adjusted EBITDA of $2.8 million for the quarter. Both of these are firsts for the company. Lastly, adjusted EBITDA loss improved $8.7 million year to date, coming in at $1.4 million compared to $10.1 million in H1 2025. Our GAAP net loss for the quarter was $20 million, which includes a $19.7 million non-cash fair value charge resulting from the remeasurement of financial instruments tied to stock price movement. Turning to cash flow, net cash used in operating activities was $8.6 million in Q2, compared to $4.3 million used in the prior year period. It is important to note that GAAP operating cash flow excludes $8.3 million in proceeds from the sale of an in-orbit satellite originally capitalized as part of our own fleet. These proceeds are presented within investing activities.

Speaker #3: Lastly, adjusted EBITDA loss improved 8.7 million year-to-date coming in at $1.4 million compared to $10.1 million in the first half of 2025. Our gap net loss for the quarter was $20 million which includes a 19.7 million non-cash fair value charge resulting from the remeasurement of financial instruments tied to stock price movement.

Speaker #3: Turning to cash flow, net cash used in operating activities was $8.6 million in the second quarter, compared to $4.3 million used in the prior-year period.

Rick Dunn: Turning to cash flow, net cash used in operating activities was $8.6 million in Q2, compared to $4.3 million used in the prior year period. It is important to note that GAAP operating cash flow excludes $8.3 million in proceeds from the sale of an in-orbit satellite originally capitalized as part of our own fleet. These proceeds are presented within investing activities.

Speaker #3: It is important to note that gap operating cash flow excludes $8.3 million in proceeds from the sale of an in-orbit satellite originally capitalized as part of our own fleet.

Speaker #3: These proceeds are presented within investing activities. From an adjusted operating cash flow basis, which includes the in-orbit satellite sale, our operating cash flow for the first half was essentially break even at $100,000.

Rick Dunn: From an adjusted operating cash flow basis, which includes the in-orbit satellite sale, our operating cash flow for H1 was essentially break-even at $100,000. Looking at the balance sheet, we closed the quarter in a strong liquidity position with $112.8 million in cash and cash equivalents. In terms of backlog, total non-cancelable remaining performance obligations stood at $80.7 million as of 30 June, with $45.8 million expected to be recognized in the next 12 months. This is an increase of $15.9 million this quarter, reflecting $28.6 million of additions to backlog and $12.7 million recognized as revenue in the quarter. Additionally, we delevered by $12 million as a result of an equity conversion exercised by our secured convertible note holder during the quarter. Our secured convertible debt reduced from $30 million to $18 million during the quarter.

Speaker #3: Looking at the balance sheet, we closed the quarter in a strong liquidity position, with $112.8 million in cash and cash equivalents. In terms of backlog, total non-cancelable remaining performance obligations stood at $80.7 million as of June 30th, with $45.8 million expected to be recognized in the next 12 months.

Speaker #3: This is an increase of $15.9 million this quarter, reflecting $28.6 million of additions to backlog and $12.7 million recognized as revenue in the quarter.

Rick Dunn: This is an increase of $15.9 million this quarter, reflecting $28.6 million of additions to backlog and $12.7 million recognized as revenue in the quarter. Additionally, we delevered by $12 million as a result of an equity conversion exercised by our secured convertible note holder during the quarter. Our secured convertible debt reduced from $30 million to $18 million during the quarter.

Speaker #3: Additionally, we delevered by $12 million as a result of an equity conversion exercise by our secured convertible noteholder during the quarter. Our secured convertible debt reduced from $30 million to $18 million during the quarter.

Speaker #3: With our operating leverage growing recurring revenue and expanding defense pipeline, we expect 2026 to be a major step towards sustained profitability crossing into positive free cash flow in 2027 as Merlin enters operational service.

Rick Dunn: With our operating leverage, growing recurring revenue, and expanding defense pipeline, we expect 2026 to be a major step towards sustained profitability, crossing into positive free cash flow in 2027 as Merlin enters operational service. With that, I will turn the call back over to Emiliano.

Speaker #3: With that, I will turn the call back over to Emiliano.

Speaker #2: Thank you, Rick. We see the Earth Observation Market undergoing a fundamental transformation. For years, the gaps in this market were not so much the technology problem but a unit economics and business model problem.

Emiliano Kargieman: Thank you, Rick. We see the Earth observation market undergoing a fundamental transformation. For years, the gaps in this market were not so much a technology problem, but a unit economics and business model problem. Legacy providers could not build the infrastructure required to capture information globally and persistently at a reasonable cost and could not deliver data at the scale required. Customers suffered the consequences. Sparse, expensive, and capacity-limited systems were insufficient to serve the growing demand for geospatial awareness and forced the legacy Earth observation business model to be transactional, expensive, and exclusive. A customer requests an image of a specific coordinate, receives a fragmented snapshot, experiences breaks in cadence, and buys imagery scene by scene at a high cost, leaving them with an incomplete view and exposing them to decision risk.

Speaker #2: Legacy providers could not build the infrastructure required to capture information globally and persistently at a reasonable cost, and could not deliver data at the scale required.

Speaker #2: Customers, suffered the consequences. Sparse expensive and capacity-limited systems were insufficient to serve a growing demand for geospatial awareness, and forced the legacy Earth Observation business model to be transactional, expensive, and exclusive.

Emiliano Kargieman: Customers suffered the consequences. Sparse, expensive, and capacity-limited systems were insufficient to serve the growing demand for geospatial awareness and forced the legacy Earth observation business model to be transactional, expensive, and exclusive. A customer requests an image of a specific coordinate, receives a fragmented snapshot, experiences breaks in cadence, and buys imagery scene by scene at a high cost, leaving them with an incomplete view and exposing them to decision risk.

Speaker #2: A customer requesting an image of a specific coordinate receives a fragmented snapshot, experiences breaks in cadence, and buys imagery scene by scene at a high cost.

Speaker #2: Leaving them with an incomplete view and exposing them to decision risk. With the technology stack that Satellogic has built over the last few years, that is no longer the case.

Emiliano Kargieman: With the technology stack that Satellogic has built over the last few years, that is no longer the case. Our satellite capacity, unit economics, and scalability allow us to build the infrastructure required to deliver persistent global intelligence. Persistent global intelligence is a different category. The requirement is to identify and monitor areas continuously, delivering an uninterrupted stream of situational awareness. As persistent monitoring becomes available in the market, customers are leaning into continued monitoring service to replace episodic imagery. We believe this shift is structural, supported by our unit economic breakthroughs, and fueled by heightened geopolitical urgency, distributed threats, and the coming of age of AI and analytics. Defense and intelligence customers are starting to prioritize persistent monitoring over transactional buys. That moves our business towards high-margin, multi-quarter subscription programs.

Speaker #2: Our satellite capacity, unit economics, and scalability allow us to build the infrastructure required to deliver persistent global intelligence. Persistent global intelligence is a different category.

Speaker #2: The requirement is to identify and monitor areas continuously, delivering an uninterrupted stream of situational awareness. As persistent monitoring becomes available in the market, customers are leaning into continued monitoring services to replace episodic imagery.

Emiliano Kargieman: As persistent monitoring becomes available in the market, customers are leaning into continued monitoring service to replace episodic imagery. We believe this shift is structural, supported by our unit economic breakthroughs, and fueled by heightened geopolitical urgency, distributed threats, and the coming of age of AI and analytics. Defense and intelligence customers are starting to prioritize persistent monitoring over transactional buys. That moves our business towards high-margin, multi-quarter subscription programs.

Speaker #2: We believe this shift is structural. Supported by our unit economic breakthroughs and fueled by heightened geopolitical urgency, distributed threats and the coming of age of AI and analytics.

Speaker #2: Defense and intelligence customers are starting to prioritize persistent monitoring over transactional buys. That moves our business towards high margin, multi-quarter subscription programs. This quarter, we started to see the impact of this change in our numbers rather than only in customer conversations.

Emiliano Kargieman: This quarter, we started to see the impact of this change in our numbers rather than only in customer conversations. Our data and analytics revenue, as Rick mentioned, was $7.1 million in Q2, up from $4.6 million in Q1. A 54% sequential growth on the subscription side of business, even in a quarter where satellite deliveries were the headline. Aleph Observer, the persistent monitoring platform we launched in February, is converting one-off imagery buyers into multi-quarter monitoring subscriptions. Six months ago, persistent global intelligence was the pieces we were describing to you. It is now becoming a core driver of the company's business. This brings me to why we are positioned to lead this category. Vertical integration and our payload innovations are what make persistent global scale coverage economically viable and poised for growth. This comes down to physics and unit economics.

Speaker #2: Our data and analytics revenue, as Rick mentioned, was $7.1 million in the second quarter, up from $4.6 million in the first. That's a 54% sequential growth on the subscription side of the business, even in a quarter where satellite deliveries were the headline.

Speaker #2: Out of observer, the persistent monitoring platform we launched in February is converting one of imagery buyers into multi-quarter monitoring subscriptions. Six months ago, persistent global intelligence was a thesis we were describing to you.

Emiliano Kargieman: Six months ago, persistent global intelligence was the pieces we were describing to you. It is now becoming a core driver of the company's business. This brings me to why we are positioned to lead this category. Vertical integration and our payload innovations are what make persistent global scale coverage economically viable and poised for growth. This comes down to physics and unit economics.

Speaker #2: It is now becoming a core driver of the company's business. This brings me to why we are positioned to lead this category. Vertical integration and our payload innovations are what make persistent global-scale coverage economically viable and poised for growth.

Speaker #2: This comes down to physics and unit economics. Our patent-protected camera design lets us capture an exceptional volume of high-resolution imagery from a small set form factor, and combined with a fully loaded new set cost of approximately $1.3 million per satellite, a small fraction of the industry standard, that collection efficiency sets or operating economics apart.

Emiliano Kargieman: Our patent-protected camera design lets us capture an exceptional volume of high-resolution imagery from a smallsat form factor, combined with a fully loaded NewSat cost of approximately $1.3 million per satellite, a small fraction of the industry standard, that collection efficiency sets our operating economics apart. That cost structure is why we can serve persistent monitoring at theater scale and still hold the gross margins that Rick just walked us through, and why our margin profile improves rather than compresses as we scale collection. As the market shifts to always-on monitoring, Satellogic builds the infrastructure that produces the persistent intelligence. For sovereign defense customers, this infrastructure delivers strategic autonomy, intelligence continuity, and decision advantage independent of third-party priorities and without key dependencies on foreign suppliers. Here is how this infrastructure is built across a series of integrated layers. First, operational monitoring with NewSats.

Speaker #2: That cost structure is why we can serve persistent monitoring at theater scale and still hold the gross margins that Rick just walked us through.

Speaker #2: And why our margin profile improves rather than compresses as we scale collection. As the market shifts to always-on monitoring, Satellogic builds the infrastructure that produces the persistent intelligence.

Emiliano Kargieman: As the market shifts to always-on monitoring, Satellogic builds the infrastructure that produces the persistent intelligence. For sovereign defense customers, this infrastructure delivers strategic autonomy, intelligence continuity, and decision advantage independent of third-party priorities and without key dependencies on foreign suppliers. Here is how this infrastructure is built across a series of integrated layers. First, operational monitoring with NewSats.

Speaker #2: For sovereign defense customers, this infrastructure delivers strategic autonomy, intelligence continuity, and decision advantage independent of third-party priorities, and without key dependencies on foreign suppliers.

Speaker #2: Here is how this infrastructure is built across a series of integrated layers. First, operational monitoring with new sets. Our 50-centimeter-class Mark V and Mark VI satellite constellation is operational today.

Emiliano Kargieman: Our 50-centimeter class Mark V and Mark VI satellite constellation is operational today, powering persistent monitoring across thousands of priority sites daily and driving subscription revenue through Aleph Observer. Second, the global baseline detection layer we're building with Merlin. Our Merlin constellation is on track to start launching in October 2026. The first satellite is fully integrated and ready to ship to the launcher, having passed all environmental and functional tests. Merlin is our daily global remap constellation, designed to create a dedicated global baseline detection layer. Building on the onboard computing, edge AI, and intersatellite links we engineer for a NewSat fleet, Merlin satellites incorporate a wide swath, high-resolution imager, and the ability to process data directly in orbit and communicate across our entire constellation in real time.

Emiliano Kargieman: Our 50cm class Mark V and Mark VI satellite constellation is operational today, powering persistent monitoring across thousands of priority sites daily and driving subscription revenue through Aleph Observer. Second, the global baseline detection layer we're building with Merlin. Our Merlin constellation is on track to start launching in October 2026.

Speaker #2: Powering persistent monitoring across thousands of priority sites daily and driving subscription revenue through out of observer. Second, the global baseline detection layer we're building with Merlin.

Speaker #2: Our Merlin constellation is on track to start launching in October 2026. The first satellite is fully integrated and ready to ship to the launcher, having passed all environmental and functional tests.

Emiliano Kargieman: The first satellite is fully integrated and ready to ship to the launcher, having passed all environmental and functional tests. Merlin is our daily global remap constellation, designed to create a dedicated global baseline detection layer. Building on the onboard computing, edge AI, and intersatellite links we engineer for a NewSat fleet, Merlin satellites incorporate a wide swath, high-resolution imager, and the ability to process data directly in orbit and communicate across our entire constellation in real time.

Speaker #2: Merlin is our daily global remap constellation, designed to create a dedicated global baseline detection layer. Building on the onboard computing, edge AI, and inter-satellite links we engineer for our new set fleet, Merlin satellites incorporate a wide swath, high-resolution imager and the ability to process data directly in orbit and communicate across our entire constellation in real time.

Speaker #2: Rather than waiting for a ground station downlink, Merlin can detect changes at the edge and automatically keep in queue or higher resolution constellation in seconds, collapsing what used to be a multi-hour ground loop to minutes.

Emiliano Kargieman: Rather than waiting for a ground station downlink, Merlin can detect changes at the edge and automatically tip and cue our higher-resolution constellation in seconds, collapsing what used to be a multi-hour ground loop to minutes. The third layer is precision verification with NextGen, our 30-centimeter class system currently in development to confirm, characterize, and verify activity. On top of these data collection layers sit our and our partners' AI and analytics and our customers' agentic platforms, implementing the automated workflows that deliver decisions at scale and on time. The true power is in the AI-first automated loop amongst these layers. The baseline detects, the monitoring layer sustains, and the precision layer verifies, giving our customers an integrated always-on decision advantage.

Speaker #2: The third layer is precision verification, with next-gen or 30-centimeter class systems currently in development to confirm, characterize, and verify activity. On top of these data collection layers sit our and our partners' AI and analytics, and our customers' agentic platforms, implementing the automated workflows that deliver decisions at scale and on time.

Emiliano Kargieman: On top of these data collection layers sit our and our partners' AI and analytics and our customers' agentic platforms, implementing the automated workflows that deliver decisions at scale and on time. The true power is in the AI-first automated loop amongst these layers. The baseline detects, the monitoring layer sustains, and the precision layer verifies, giving our customers an integrated always-on decision advantage.

Speaker #2: The true power is in the AI-first automated loop among these layers. The baseline detects, the monitoring layer sustains, and the precision layer verifies, giving our customers an integrated, always-on decision advantage.

Speaker #2: Our product offering across data and analytics and space systems ranging from imagery archive all the way to local assembly and integration facilities and supply chain localization, is built to support our customers in their journey towards operating a truly sovereign, autonomous, and independent infrastructure for persistent global intelligence.

Emiliano Kargieman: Our product offering across data analytics and space systems, ranging from imagery archive all the way to local assembly and integration facilities and supply chain localization, is built to support our customers in their journey towards operating a truly sovereign, autonomous, and independent infrastructure for persistent global intelligence. As a quick aside, I mentioned that Merlin is on track for its October launch, and I want now to draw your attention to this image showing the first Merlin satellite, Merlin 01, fully integrated in our clean room last month. This is our first flight model, built end-to-end in-house based on our extensive bus heritage from the NewSat constellation after having successfully passed all environmental qualification and functional testing.

Speaker #2: As a quick aside, I mentioned that Merlin is on track for its October launch and I want now to draw your attention to this image.

Emiliano Kargieman: As a quick aside, I mentioned that Merlin is on track for its October launch, and I want now to draw your attention to this image showing the first Merlin satellite, Merlin 01, fully integrated in our clean room last month. This is our first flight model, built end-to-end in-house based on our extensive bus heritage from the NewSat constellation after having successfully passed all environmental qualification and functional testing.

Speaker #2: Showing the first Merlin satellite. Merlin 01, fully integrated in our clean room last month. This is our first flight model, built end-to-end in-house based on our extensive bus heritage from the new set constellation, after having successfully passed all environmental qualification and functional testing.

Speaker #2: The hardware is ready to ship to the launch site in time for a planned October launch window and the team is now focused on the integration of the next set of satellites in the fleet.

Emiliano Kargieman: The hardware is ready to ship to the launch site in time for a planned October launch window, and the team is now focused on the integration of the next set of satellites in the fleet. It is good to be able to share this picture and highlight that Merlin is progressing as planned, executing against the core fundamentals we committed to. Before summarizing our key takeaways, I want to share an important leadership update. As we previously disclosed, 21 August will be Rick Dunn's last day as Chief Financial Officer of Satellogic. Rick has been with us for seven and a half years. He built the financial infrastructure that carried this company through going public, through our operational scaling, and through to the strong financial results that we reported today. Our search for a permanent successor is active.

Speaker #2: It is good to be able to share this picture and highlight that Merlin is progressing as planned, executing against the core fundamentals we committed to.

Speaker #2: Before summarizing our key takeaways, I want to share an important leadership update. As we previously disclosed, August 21st will be Rick Dunn's last day as Chief Financial Officer of Satellogic.

Emiliano Kargieman: As we previously disclosed, 21 August will be Rick Dunn's last day as Chief Financial Officer of Satellogic. Rick has been with us for seven and a half years. He built the financial infrastructure that carried this company through going public, through our operational scaling, and through to the strong financial results that we reported today. Our search for a permanent successor is active.

Speaker #2: Rick has been with us for seven and a half years. He built the financial infrastructure that carried this company through going public, through our operational scaling, and through to the strong financial results we reported today.

Speaker #2: Our search for a permanent successor is active. To ensure a seamless transition, Dustin Greer, our Senior Vice President and Corporate Controller, will assume the role of interim CFO, effective August 21st, if a permanent successor has not yet been appointed.

Emiliano Kargieman: To ensure a seamless transition, Dustin Greer, our Senior Vice President and Corporate Controller, will assume the role of interim CFO effective 21 August if a permanent successor has not yet been appointed. Dustin is supported by an exceptional finance team, and we have complete confidence in their continued execution. I will hand the floor to Rick for a few brief comments.

Speaker #2: Dustin is supported by an exceptional finance team, and we have complete confidence in their continued execution. I will hand the floor to Rick for a few brief comments.

Speaker #3: Thanks, Emiliano. After seven and a half years, when I look at where we started against where we stand today, regarding our first positive operating income and adjusted EBITDA this quarter, I'm immensely proud of what this team has built.

Rick Dunn: Thanks, Emiliano. After seven and a half years, when I look at where we started against where we stand today, recording our first positive operating income in adjusted EBITDA this quarter. I'm immensely proud of what this team has built. We established a financial foundation for the first vertically integrated geospatial company and stood up the infrastructure for persistent global intelligence. The company's financial footing is the strongest it has ever been, and we've built a resilient finance organization to support the business as it continues to scale. The trajectory is clear, and I look forward to watching Satellogic execute on this next phase of growth. Thank you, everyone.

Speaker #3: We established a financial foundation for the first vertically integrated geospatial company and stood up the infrastructure for persistent global intelligence. The company's financial footing is the strongest it has ever been and we've built a resilient finance organization to support the business as it continues to scale.

Speaker #3: The trajectory is clear and I look forward to watching Satellogic execute on its next phase of growth. Thank you, everyone.

Speaker #1: Thank you, Rick. On behalf of our board and the entire team, thank you for your leadership and your dedication. To wrap up, I want to leave you with five takeaways from the second quarter.

Emiliano Kargieman: Thank you, Rick. On behalf of our board and the entire team, thank you for your leadership and your dedication. To wrap up, I want to leave you with five takeaways from the Q2. First, financial inflection has been achieved. A record Q2 revenue of $15.9 million and positive adjusted EBITDA of $2.8 million prove the operating leverage of our business model. Second, the persistent global intelligence market shift is underway. The market is transitioning from transactional imagery buys to always-on monitoring, and we build the infrastructure that powers the subscription products. Third, vertical integration is our moat. In-house design and manufacturing and the differentiated cost structure and scalability it supports makes theater-scale persistent monitoring economically viable and highly profitable. Fourth, we are fully funded to global awareness.

Speaker #1: First, financial inflection has been achieved. A record Q2 revenue of $15.9 million and positive adjusted EBITDA of $2.8 million proved the operating leverage of our business model.

Speaker #1: Second, the persistent global intelligence market shift is underway. The market is transitioning from transactional imagery bias to always-on monitoring. And with all the infrastructure, that powers the subscription problems.

Emiliano Kargieman: Second, the persistent global intelligence market shift is underway. The market is transitioning from transactional imagery buys to always-on monitoring, and we build the infrastructure that powers the subscription products. Third, vertical integration is our moat. In-house design and manufacturing and the differentiated cost structure and scalability it supports makes theater-scale persistent monitoring economically viable and highly profitable. Fourth, we are fully funded to global awareness.

Speaker #1: Third, vertical integration is our moat. In-house design and manufacturing and the differentiated cost structure and scalability it supports make the other scale persistent monitoring, economically viable, and highly profitable.

Speaker #1: Fourth, we are fully funded to global awareness. Operating one of the world's largest commercial constellations today, our Merlin constellation remains on track for its first launch in October 2026.

Emiliano Kargieman: Operating one of the world's largest commercial constellations today, our Merlin constellation remains on track for its first launch in October 2026, and fully funded to launch a global baseline detection layer equipped with edge AI and inter-satellite links with full service in H2 2027. Fifth, Satellogic is well-capitalized to respond to strong market demand. We are operating from a position of strength with $112.8 million in cash, debt principal reduced to $18 million, and strong market traction with sovereign customers across all of our product lines. With that, operator, please open the line for questions.

Speaker #1: And fully funded to launch a global baseline detection layer equipped with edge AI and inter-satellite links with full service in the second half of 2027.

Speaker #1: And fifth, Satellogic is well capitalized to respond to strong market demand. We are operating from a position of strength with 112.8 million in cash, debt principal reduced to $18 million, and strong market traction with sovereign customers across all of our product lines.

Speaker #1: With that, operator, please open the line for questions.

Speaker #4: Thank you so. Ladies and gentlemen, at this time, we will be conducting a question and answer session. If you would like to ask a question, please press star and then one.

Operator: Thank you, sir. Ladies and gentlemen, at this time, we will be conducting a question and answer session. If you would like to ask a question, please press star and then one now. A confirmation tone will indicate your line is in the question queue. You may press star and then two if you would like to remove yourself from the question queue. Again, if you would like to ask a question, please press star and then one now. The first question we have comes from Andres Sheppard of Cantor Fitzgerald. Please go ahead.

Operator: Thank you, sir. Ladies and gentlemen, at this time, we will be conducting a question and answer session. If you would like to ask a question, please press star and then one now. A confirmation tone will indicate your line is in the question queue. You may press star and then two if you would like to remove yourself from the question queue. Again, if you would like to ask a question, please press star and then one now. The first question we have comes from [Andres] Sheppard of Cantor Fitzgerald. Please go ahead.

Speaker #4: Now, a confirmation tone will indicate your line is in the question queue. You may press star and then two if you would like to remove yourself from the question queue.

Speaker #4: Again, if you would like to ask a question, please press star and then one now. The first question we have comes from Andrew Shepherd of Cancel Fritz Gerald.

Speaker #4: Please go ahead.

Speaker #1: Hey, everyone. Good afternoon. Thank you so much for taking our questions, and congratulations on the quarter. Rick, wishing you all the best as well.

Andres Sheppard: Hey, everyone. Good afternoon. Thank you so much for taking our questions, and congratulations on the quarter. Rick Dunn, wishing you all the best as well. It's been great working with you, and again, wishing you all the best. In terms of questions, first one is on Merlin. You reaffirmed that Merlin is on track for the October launch window, which is very exciting. I guess a few quick questions here is, Emiliano Kargieman, can you maybe remind us what are the key milestones left towards bringing it to the path that investors should be tracking? More importantly, as we move towards operational capacity next year, my other question there is how are you thinking about the cadence for future launches, and how quickly do you think you could potentially ramp up? Thank you.

Speaker #1: It's been great working with you. And again, wishing you all the best. In terms of questions, first one is on Merlin. So you reaffirmed that Merlin is on track for the October launch window, which is very exciting.

Speaker #1: I guess a few quick questions here is, Emiliano, can you maybe remind us what are the key milestones left towards bringing it to the pad that investors should be tracking?

Speaker #1: And more importantly, as we move towards operational capacity next year, my other question there is, how are you thinking about the cadence for future launches and how quickly do you think you could potentially ramp up?

Andres Sheppard: More importantly, as we move towards operational capacity next year, my other question there is how are you thinking about the cadence for future launches, and how quickly do you think you could potentially ramp up? Thank you.

Speaker #1: Thank you.

Speaker #5: Excellent. Hi, Andrew. Thank you for the question. Good talking to you. So yeah, Merlin is fully on track now for first launch window, which is in October.

Emiliano Kargieman: Excellent. Hi, Andres. Thank you for the question. Good talking to you. Merlin is fully on track now for first launch window, which is in October. All of the functional tests, all of the environmental tests on the satellite have been performed. The satellite is essentially packaged at our manufacturing facility and ready for pickup. Next phase is it will go to the launcher and be integrated into a launch vehicle, in this case, SpaceX Transporter mission, in time for the launch window in October. On the Satellogic side, I would say is the shipping and receiving the satellite on the other side and the launch campaign. Putting the satellite in the rocket, which we've done already more than 50 times in the past. It's something that we're quite familiar with. The satellite will go up in October.

Speaker #5: All of the functional tests, all of the environmental tests on the satellite have been performed. The satellite essentially packaged at our manufacturing facility and ready for pickup.

Speaker #5: So next phase is it will go to the launcher and be integrated into a launch vehicle. In this case, SpaceX transporter mission. In time for the launch window in October.

Emiliano Kargieman: Next phase is it will go to the launcher and be integrated into a launch vehicle, in this case, SpaceX Transporter mission, in time for the launch window in October. On the Satellogic side, I would say is the shipping and receiving the satellite on the other side and the launch campaign. Putting the satellite in the rocket, which we've done already more than 50 times in the past. It's something that we're quite familiar with. The satellite will go up in October.

Speaker #5: So on Satellogic side, I would say is the shipping and receiving the satellite on the other side and the launch campaign, so putting the satellite in the rocket.

Speaker #5: Which we've done already 50, more than 50 times in the past. So it's something that we're quite familiar with. And then the satellite will go up in October.

Speaker #5: There's a commissioning phase. For the first satellite, while we continue to produce the next Merlin satellites that will be launched in two launches, in 2027.

Emiliano Kargieman: There is a commissioning phase for the first satellite while we continue to produce the next Merlin satellites that will be launched in two launches in 2027. We expect both launches in the H1 of the year. The full constellation to provide complete service will be up if all goes according to plan in the H1 of the year. We will start delivering full service in the H2 of the year. We might and we are expecting to work with some of our anchor customers and initial customers as soon as we launch the first satellite in October to familiarize them with the data and to build the processing pipelines that they will need to operate at scale. There will be a phase there of development, software development with our initial customers.

Speaker #5: And we expect both launches in the first half of the year so the full constellation for to provide complete service will be up if all goes according to plan in the first half of the year.

Speaker #5: And then we will start delivering full service in the second half of the year. We might, and we are expecting to work with some of our anchor customers and initial customers as soon as we launch the first satellite in October, to familiarize them with the data and to build the processing pipelines that they will need to operate at scale.

Emiliano Kargieman: We might and we are expecting to work with some of our anchor customers and initial customers as soon as we launch the first satellite in October to familiarize them with the data and to build the processing pipelines that they will need to operate at scale. There will be a phase there of development, software development with our initial customers. Full services will be H2 of 2027, we expect.

Speaker #5: So there will be a phase there of development. Software development with our initial customers. But yeah, full service will be second half of 2027, we expect.

Emiliano Kargieman: Full services will be H2 of 2027, we expect.

Andres Sheppard: Excellent. Thank you very much. That was very helpful. I appreciate all that color. Just a quick follow-up. Your backlog increased materially quarter over quarter, and you provided a great slide with great granularity, which we appreciate. My question here is, you also talked about a lot of the macro landscape and things that are unfolding. I guess my question is, what other opportunities are you currently potentially working on that are not included in the backlog that you might be able to maybe share with us? And how are you thinking about continuing to increase the pipeline going forward? Thank you.

Speaker #1: Excellent. Thank you very much. That was very, very helpful. I appreciate all that color. And maybe just as a quick follow-up, so you know your backlog increased materially quarter over quarter.

Speaker #1: And you provided a great slide with great granularity, which we appreciate. My question here is, you also talked about a lot of the macro landscape and things that are unfolding.

Speaker #1: So I guess my question is, what other opportunities are you currently potentially working on that are not included in the backlog, that you might be able to maybe share with us?

Speaker #1: And how are you thinking about continuing to increase the pipeline going forward? Thank you.

Speaker #5: Yeah. So we're experienced, I think, good tailwinds from the market in sense of growing demand. Internationally, and in the US. Obviously, geopolitical tensions tend to increase.

Emiliano Kargieman: We're experiencing, I think good tailwinds from the market in the sense of growing demand internationally and in the US. Obviously, geopolitical tensions tend to increase the need for persistent intelligence. All customers and some of the customer conversations that we've been having over, I would say, the last few years are accelerating because of this. On top of that, there's an increase in defense budgets across the board from US allies around the world, which is also helpful to build out this pipeline. We also see a structural factor contributing here in the wide adoption of AI and analytics and integrating AI analytics into processing pipelines to deliver decision-grade intelligence in the defense and intelligence side.

Speaker #5: The need for persistent intelligence and so our customers and some of the customer conversations that we've been having over, I would say, the last few years are accelerating because of this.

Speaker #5: On top of that, there's an increase in defense budgets across the board, from US allies around the world, which is also helpful to build up these pipelines.

Emiliano Kargieman: On top of that, there's an increase in defense budgets across the board from US allies around the world, which is also helpful to build out this pipeline. We also see a structural factor contributing here in the wide adoption of AI and analytics and integrating AI analytics into processing pipelines to deliver decision-grade intelligence in the defense and intelligence side.

Speaker #5: And we also see structural factor contributing here in the wide adoption of AI and analytics and integrating AI analytics into processing pipelines to deliver decision-grade intelligence in the defense and intelligence side.

Speaker #5: And analytics and AI are essentially allowing our customers to basically consume a lot more data at a faster pace and still derive the right signals that they need for intelligence.

Emiliano Kargieman: The analytics and AI are essentially allowing all customers to basically consume a lot more data at a faster pace and still derive the right signals that they need for intelligence. I think all of these factors, we see contributing to increased demand. To respond to that demand, we have brought in some fantastic new members to our sales team that have the relationships and the international experience to help us bring what we're doing to customers at a faster pace, right? We are responding to that demand. I think our pipeline is very strong. We continue to see traction in the market. We continue to see increased interest, and we expect that pipeline to continue to convert in H2 of the year and into 2027 at a fast pace.

Speaker #5: So I think all of these factors we see contributing to increased demand. To respond to that demand, we have brought in some fantastic new members to our sales team that have the relationships and the international experience to help us bring what we're doing to customers at a faster pace, right?

Speaker #5: So we are responding to that demand. I think our pipeline is, I think it's very strong. It's continued. We continue to see traction in the market.

Emiliano Kargieman: We are responding to that demand. I think our pipeline is very strong. We continue to see traction in the market. We continue to see increased interest, and we expect that pipeline to continue to convert in H2 of the year and into 2027 at a fast pace.

Speaker #5: We continue to see increased interest, and we expect that pipeline to continue to convert in the second half of the year and into 2027 at a fast pace.

Speaker #1: Wonderful. Thank you so much. Congrats again on the quarter. We'll pass it on.

Andres Sheppard: Wonderful. Thank you so much. Congrats again on the quarter. We'll pass it on.

Speaker #5: Thanks, Andrew.

Emiliano Kargieman: Thanks, Andres.

Emiliano Kargieman: Thanks, [Andres.]

Speaker #4: Thank you. The next question we have comes from Jeff Funnery of Craig Hallum Capital Group. Please go ahead.

Operator: Thank you. The next question we have comes from Jeff Fanari of Craig-Hallum Capital Group. Please go ahead.

Operator: Thank you. The next question we have comes from Jeff Van Rhee of Craig-Hallum Capital Group. Please go ahead.

Speaker #3: Great. Thanks. Thanks for taking the questions. And Rick, sure it's certainly been a pleasure working with you. Wish you all the best. Emiliano.

Jeff Fanari: Great. Thanks for taking the questions, and Rick, sure, it's certainly been a pleasure working with you. Wish you all the best. Emiliano.

Jeff Van Rhee: Great. Thanks for taking the questions, and Rick, sure, it's certainly been a pleasure working with you. Wish you all the best. Emiliano.

Speaker #5: Thank you, Jeff.

Emiliano Kargieman: Thank you, Jeff.

Speaker #3: Yeah, you bet. So just a few things. I guess Emiliano, I'll have observed February 26th launch. I think you mentioned this was the year of pilots.

Jeff Fanari: Yeah, you bet. Just a few things. I guess, Emiliano, on Aleph Observer, 26 February launch, I think you mentioned this was the year of pilots. Can you dive a little deeper there, maybe even quantify how many pilots, how are they progressing, what's the feedback, all of that relative to expectations? Any other color you'd share would be great.

Jeff Van Rhee: Yeah, you bet. Just a few things. I guess, Emiliano, on Aleph Observer, 26 February launch, I think you mentioned this was the year of pilots. Can you dive a little deeper there, maybe even quantify how many pilots, how are they progressing, what's the feedback, all of that relative to expectations? Any other color you'd share would be great.

Speaker #3: Can you dive a little deeper there, maybe even quantify how many pilots, how are they progressing, what's the feedback, all of that relative to expectations, any other color you'd share would be great.

Speaker #5: Sure, thanks, Jeff. Thanks for the question. So, yeah, I mean, in reality, I would say we expected 2026, as we mentioned before, to be a year of pilots.

Emiliano Kargieman: Sure. Thanks, Jeff. Thanks for the question. Yeah, in reality, I would say, we expected 2026, as we mentioned before, to be a year of pilots. Because typically a new product like this requires customers to get familiar with it and for them, particularly government customers on the defense side, it requires that they find the budgets to pay for distinct subscriptions and so on. We expected 2026 to be able to tap into a portion of their discretional budgets for pilots and then those convert into full range services and the kind of the cadence that we expect or the number of sites that we expect them then to monitor just going into 2027, right? I think we've been pleasantly surprised by the speed at which we are converting some of these pilots into full programs.

Speaker #5: Because typically, a new product like this requires customers to get familiar with it and for them particularly government customers in the defense side, it requires that they find the budgets to pay for this distinct subscription and so on.

Speaker #5: So we expected 2026 to be able to tap into a portion of their discretional budgets for pilots and then those convert into full-range services and at a kind of the cadence that we expected or the number of sites that we expected to monitor just going into 2027, right?

Emiliano Kargieman: We expected 2026 to be able to tap into a portion of their discretional budgets for pilots and then those convert into full range services and the kind of the cadence that we expect or the number of sites that we expect them then to monitor just going into 2027, right? I think we've been pleasantly surprised by the speed at which we are converting some of these pilots into full programs. I think the $18 million contract we announced a few months ago is a very good example. We went from the initial pilot to a full-scale program that's at $80 million per year in less than six months, I think. That's been a really good surprise.

Speaker #5: I think we've been pleasantly surprised by the speed at which we are converting some of these pilots into full programs. I think the $18 million contract we announced a few months ago is a very good example.

Emiliano Kargieman: I think the $18 million contract we announced a few months ago is a very good example. We went from the initial pilot to a full-scale program that's at $80 million per year in less than six months, I think. That's been a really good surprise. We obviously do not expect all of the pilots that we're doing to progress at the same speed. That was a really good indication of the traction that we're getting in the market. The team is actively working with customers across all of the geographies that we serve now on the initial pilot program. We really expect to have more news to share in H2 of the year.

Speaker #5: I mean, we went from the initial pilot to a full-scale program that's at $18 million per year. And less than six months, I think.

Speaker #5: And so that's been a really good surprise. We obviously do not expect all of the pilots that we're doing to progress at the same speed.

Emiliano Kargieman: We obviously do not expect all of the pilots that we're doing to progress at the same speed. That was a really good indication of the traction that we're getting in the market. The team is actively working with customers across all of the geographies that we serve now on the initial pilot program. We really expect to have more news to share in H2 of the year.

Speaker #5: But there was a really good, I think there's a really good indication of the traction that we're getting in the market. And the team is working actively working with customers across all of the geographies that we serve now on the initial pilot program.

Speaker #5: So we really expect to have more news to share in the second half of the year.

Jeff Fanari: Mm-hmm. Got it. More broadly than just as I look at the pipeline or as you look at the pipeline, cycle times, deal sizes, deal types, competition, geography, any aspects that are notable in your mind that have changed maybe in the last 180, maybe even last 90 days?

Jeff Van Rhee: Mm-hmm. Got it. More broadly than just as I look at the pipeline or as you look at the pipeline, cycle times, deal sizes, deal types, competition, geography, any aspects that are notable in your mind that have changed maybe in the last 180, maybe even last 90 days?

Speaker #3: Got it. And more broadly then, just as I look at the pipeline, or as you look at the pipeline, cycle times, deal sizes, deal types, competition, geography, I mean, any aspects that are notable in your mind that have changed maybe in the last 180, maybe even last 90 days?

Speaker #5: No, nothing out of what we have already commented on, which is we are seeing some of the conversations that we're having on accelerated timelines, let's say.

Emiliano Kargieman: No, nothing out of what we have already commented on, which is we are seeing some of the conversations that we're having on accelerated timelines, let's say. Typically, we would expect Sovereign space system deals, because they are large deals. We expect typically longer sales cycles, over a year or so. We are seeing some cases in which we are seeing deals progress through the pipeline at a faster pace. This is also due to, I think the factors that we mentioned before. We're seeing some of the sales cycles on the space systems in particular being compressed, which is good news. In general, I would say, both business lines, data analytics and space systems, still follow the same patterns that we're expecting, right?

Speaker #5: We expected typically we would expect sovereign spaces and deals because they are large deals. They're we expected typically longer sales cycles. And over a year, or so.

Speaker #5: And we are seeing some cases in which we are seeing deals progress through the pipeline at a faster pace. This is also due to, I think, the factors that we mentioned before.

Speaker #5: So, we're seeing some of the sales cycles on the space systems—in particular—being compressed, which is good news. But in general, I would say both business lines follow the same patterns that we're expecting, with space systems being lumpier, deals with longer sales cycles, and data analytics deals being smaller ticket sizes and having faster sales cycles.

Emiliano Kargieman: In general, I would say, both business lines, data analytics and space systems, still follow the same patterns that we're expecting, right? With space systems being lumpier deals with longer sales cycles, and data analytics deals being smaller ticket sizes, faster sales cycles, but also subscription-based recurring revenue that helps us build a predictable base. Right? I think both business lines are behaving pretty much to expectation, I would say.

Emiliano Kargieman: With space systems being lumpier deals with longer sales cycles, and data analytics deals being smaller ticket sizes, faster sales cycles, but also subscription-based recurring revenue that helps us build a predictable base. Right? I think both business lines are behaving pretty much to expectation, I would say.

Speaker #5: But also subscription-based recurring revenue that helps us build a predictable base, right? So I think those business lines are behaving pretty much to expectation, I would say.

Speaker #3: Yeah. That's great. Maybe one last, I mean, I think certainly you commented were for driving almost infinite need, AI wants, all the sensor data it can provide.

Jeff Fanari: Yeah. That's great. Maybe one last. I think certainly you commented where AI is driving almost infinite need, AI wants all the sensor data it can provide. I think with Merlin and a lot of the things you're talking about, you're playing directly to that. I'm curious on the AI front. Has your perspective on the AI impact on your business changed in any material ways last kind of 90, 180 days?

Jeff Van Rhee: Yeah. That's great. Maybe one last. I think certainly you commented where AI is driving almost infinite need, AI wants all the sensor data it can provide. I think with Merlin and a lot of the things you're talking about, you're playing directly to that. I'm curious on the AI front. Has your perspective on the AI impact on your business changed in any material ways last kind of 90, 180 days?

Speaker #3: So I think with Merlin, and a lot of the things you're talking about, you're playing directly to that. But I'm curious about the AI sprint.

Speaker #3: Has your perspective on the AI impact on your business changed in any material ways last kind of 90, 180 days?

Emiliano Kargieman: We believe that AI is here. It basically has a structural force in our market, is here to stay, right? We believe there is a huge impact in terms of the ability of our customers to consume more data at a faster pace, it creates more demand for the data that we produce and that our constellations will produce in the future, right? We think this is a structural change. We don't think this is a fad. I think that supports our outlook into the future. I think it supports also this year being such a transformational year for the company and kind of our breakout year as Rick was saying, as we start to show the impact of our operating leverage by increasing our top line. Yeah, nothing's fundamentally changed in our minds, Jeff.

Speaker #5: We believe that AI is here, is basically as a structural force in our market is here to stay, right? We believe there is a huge impact in terms of the ability of our customers to consume more data at a faster pace and it creates more demand.

Speaker #5: For the data that we produce, and that our constellations will produce in the future, right? So, we think this is a structural change. We don't think this is a fad.

Emiliano Kargieman: We don't think this is a fad. I think that supports our outlook into the future. I think it supports also this year being such a transformational year for the company and kind of our breakout year as Rick was saying, as we start to show the impact of our operating leverage by increasing our top line. Yeah, nothing's fundamentally changed in our minds, Jeff. I think we're seeing a lot of confirmation from the market of this trend.

Speaker #5: So I think that supports or Outlook into the future, I think it supports also this year being such a transformational year for the company and kind of our breakout year.

Speaker #5: As we start to as Rick was saying, as we start to show the impact of our operating leverage by increasing our top line. But yeah, nothing's fundamentally changed in our minds yet.

Speaker #5: I think we're seeing a lot of confirmation from the market of this trend.

Emiliano Kargieman: I think we're seeing a lot of confirmation from the market of this trend.

Speaker #3: Yeah. Well, nice numbers. Love the incremental margins. A lot here to like, so congrats to you and the team.

Jeff Fanari: Yeah. Well, nice numbers. Love the incremental margins a lot here to like, congrats to you and the team.

Jeff Van Rhee: Yeah. Well, nice numbers. Love the incremental margins a lot here to like, congrats to you and the team.

Speaker #5: Thanks, Jeff.

Emiliano Kargieman: Thanks, Jeff.

Speaker #1: Thank you. The next question we have comes from Suji DeSilva of Roth Capital Partners. Please go ahead.

Operator: Thank you. The next question we have comes from Suji Desilva of Roth Capital Partners. Please go ahead.

Speaker #4: Hi Emiliano. Hi Rick and best of luck in the transition, Rick. So on the data analytics revenue, it was very strong sequentially. And I know you mentioned that customers are upgrading to persistent monitoring.

Suji Desilva: Hi, Emiliano. Hi, Rick, and best of luck in the transition, Rick. On the data analytics revenue, it was very strong sequentially, and I know you mentioned that customers upgrading to persistent monitoring. Can you talk about maybe the metrics that could show that kind of Q over Q strength is happening and maybe whether it'll persist, things like ARPU or customer utilization, maybe anything that'll help us understand the transition from imagery to persistent monitoring.

Speaker #4: Can you talk about maybe the metrics that could show that kind of Q over Q strength is happening and maybe whether it'll persist? Things like ARPU or customer utilization, maybe anything that will help us understand the transition from imagery to persistent monitoring?

Speaker #5: Hi, Suji. Yeah, no, that's a super good question. And we are not we're not sharing those metrics yet. But we're definitely collecting them. And we've had two quarters almost less than two quarters since launch of out-of-observer.

Emiliano Kargieman: Hi, Suji. Yeah, no, that's a super good question. We're not sharing those metrics yet. We're definitely collecting them and we've had two quarters, almost two quarters since launch of Aleph Observer. We would like to observe the performance for a couple more quarters before we start sharing metrics like ARPU or MRR or long-term customer value and so on, right? We think those are valuable as longer-term trends, but we're definitely looking at them and we believe this subscription business that we're building on the data analytics side is really should have metrics compatible with data service or software service business models in general. I think those are the benchmarks that we are using internally to measure performance.

Speaker #5: So we would like to observe the performance for a couple more quarters before we start sharing metrics like ARPU or MRR or long-term customer value and so on, right?

Emiliano Kargieman: We would like to observe the performance for a couple more quarters before we start sharing metrics like ARPU or MRR or long-term customer value and so on, right? We think those are valuable as longer-term trends, but we're definitely looking at them and we believe this subscription business that we're building on the data analytics side is really should have metrics compatible with data service or software service business models in general. I think those are the benchmarks that we are using internally to measure performance.

Speaker #5: We think those are valuable as longer-term trends. But we're definitely looking at them and we believe this subscription business that we're building on data analytics side is really should have metrics compatible with data as a service or software as a service business models in general.

Speaker #5: So I think those are the benchmarks that we are using internally to measure performance.

Speaker #4: Okay, great. I look forward to those. They should probably tell a positive story when you do put them out. My other question is on the SynMax and SpaceKnow applications.

Suji Desilva: Okay, great. I look forward to those, and they should probably tell a positive story when you do put them out. My other question's on the SynMax and SpaceKnow applications. Sounds like you're building a platform where more apps can be layered on. Is that sort of a virtuous circle that the apps bring customers to the platform? Is there an actual business model financial contribution from these apps to you above and beyond the value add of the network?

Speaker #4: Sounds like you're building a platform where more apps can be layered on. Is that sort of a virtuous circle that the apps bring customers to the platform?

Speaker #4: Or is there an actual business model financial contribution from these apps to you above and beyond the value add of the network?

Speaker #5: Yeah, well, the first I think the first thing that I should mention with SpaceNo and with Synmax is that we're bringing to our customers models trained for their specific use cases.

Emiliano Kargieman: Yeah. I think the first thing that I should mention, with SpaceKnow and with SynMax, is that we're bringing to our customers models trained for their specific use cases, best-of-breed models trained for their specific use cases. This adds value to our customers directly. It also, as mentioned before, allowed us to deliver more data that has a real impact, right? I think it's a win for every party here. It's a lot of added value to customers. It's obviously a good business over time for partners building the applications. On top of our data, and to the extent that it allows us to deliver more data to more customers, it's a great win for Satellogic too, right? We think it's super synergistic.

Speaker #5: Best of breed models trained for the specific use cases. And this adds value to our customers directly. And it also as mentioned before, allowed us to deliver more data that has a real impact, right?

Speaker #5: So I think it's a it's a win for every party here. It's a lot of added value to customers. It's obviously a good business over time for partners.

Speaker #5: Building the applications on top of our data and to the extent that it allows us to deliver more data to more customers, it's a great win for Satellogic too, right?

Speaker #5: So we think it's super synergistic. You can expect to see more partners and more applications signed on top of our data feeds, particularly obviously for out-of-observer today, but also particularly as Merlin starts to become operational next year, this is going to be one of the ways in which we deliver value to the end customers, right?

Emiliano Kargieman: You can expect to see more partners and more applications signed on top of our data feeds, particularly, obviously for Aleph Observer today, but also particularly as Merlin starts to become operational next year. This is going to be one of the ways in which we deliver value to the end customers.

Speaker #4: Okay. Thanks, Emiliano. Thanks, Rick. Congratulations on the results again.

Suji Desilva: Okay. Thanks, Emiliano. Thanks, Rick. Congratulations on the results again.

Speaker #5: Thanks, Suji.

Emiliano Kargieman: Thanks. To you.

Emiliano Kargieman: Thanks, Suji.

Speaker #1: Thank you. Thank you. The next question we have comes from Alex Lassimore of Northland Capital Markets. Please go ahead.

Operator: Thank you. The next question we have comes from Michael Latimore of Northland Capital Markets. Please go ahead.

Speaker #6: Hi Emiliano. Best of luck, Rick. In the journey. I just have one question on talent here. I was wondering if there are any insights into potential contract renewal later this year or early '27?

Michael Latimore: Hi, Emiliano. Best of luck, Rick, in the journey. I just have one question on Palantir. I was wondering if there are any insights into a potential contract renewal later this year or early 2027.

Speaker #5: Yeah. Hi. Thanks. Thanks for the question. Michael. So we are we continue to work with Palantir as a great partner. Today, delivering data mostly to the US government.

Emiliano Kargieman: Yeah. Hi. Thanks for the question, Michael. We continue to work with Palantir as a great partner today, delivering data mostly to the US government. We are not in a position today to confirm any follow-on contracts with them, but they have been a strong partner for us over the last four and a half years. The end customers are receiving a lot of value from this collaboration. We are working with them in discussing how these relationships with the end customer continue after the end of the current contract.

Speaker #5: We're not in a position today to confirm or any follow-on contracts with them, but they have been a strong partner for us over the last four and a half years.

Speaker #5: And the end customers are receiving a lot of value from this collaboration. So we have our working with them in discussing how this relationships with the end customer continue after the end of the current contract.

Speaker #3: Yeah, I'll just jump in and add that just add real quick, Alex. And thanks for the question. That as you're aware, this relationship with Palantir has been structured historically has been structured as a barter transaction.

Rick Dunn: Yeah. I will just jump in and just add real quick, Michael, and thanks for the question. That as you are aware, this relationship with Palantir historically has been structured as a barter transaction. The net cash to us is zero. I think we did that at a time where bringing them on board as a partner and establishing a relationship with them, and getting them to use our data was super important. It continues to be super important and we are optimistic about our ability to hopefully continue providing them with our data and analytics. We are also at a different point in the business where we do not necessarily feel like we need to barter out our data and analytics at this point. I think that they have used our data, they like our data, and hopefully they will continue to use our data and we will actually get cash for it.

Speaker #3: So the net cash to us is zero. And I think we did that at a time where bringing them on board as a partner and establishing a relationship with them and getting them to use our data was super important.

Speaker #3: It continues to be super important and we're optimistic about our ability to hopefully continue providing them with our data and analytics but we're also at a different point in the business where we don't necessarily feel like we need to barter out our data and analytics at this point.

Rick Dunn: We are also at a different point in the business where we do not necessarily feel like we need to barter out our data and analytics at this point. I think that they have used our data, they like our data, and hopefully they will continue to use our data and we will actually get cash for it.

Speaker #3: So I think that they have they've used our data. They like our data. And hopefully, they'll continue to use our data. And we'll actually get cash for it.

Speaker #6: Great. Thanks. Another one, so it sounds like there are many pilots in the work here. I was wondering if you had insights into the future here, if you can look into your crystal ball to see what the average deal size with sovereign nations might be, going forward.

Michael Latimore: Great. Thanks. Another one. It sounds like there are many pilots in the work here. I was wondering if you had insights into the future here, if you can look into your crystal ball to see what the average deal size with sovereign nations might be going forward.

Speaker #3: Yeah. I mean, it's Emiliano, you can feel free to jump in too, but it will continue to vary. It depends really deal to deal.

Rick Dunn: Yeah. Emiliano, you can feel free to jump in too, but it will continue to vary. It depends really deal to deal. It's hard to put parameters around deal size. I think that we're certainly looking at seven and eight-figure deals, that much I can say, but that's obviously a pretty wide range. It's just going to depend on the customer, their needs, and how quickly they're able and willing to move on either data acquisition or a space systems deal.

Speaker #3: And it's hard to put parameters around deal size. I think that we're certainly looking at seven and eight-figure deals. That much I can say, but that's obviously a pretty wide range.

Speaker #3: It's just going to depend on the customer, their needs, and how quickly they're able and willing to move on either data acquisition or a space systems deal.

Michael Latimore: Great. One final quick one. I was just wondering how much open capacity you currently have on your constellation. Also, is it correct to think about full capacity, data subscription capacity on NewSat at about $65 million?

Speaker #6: Great. One final quick one. I was just wondering how much open capacity you currently have on your constellation? And then also, is it correct to think about full capacity data subscription capacity on NuSat at about 65 million?

Speaker #3: Yeah. Emiliano will elaborate on this, but no, I wouldn't make that assumption on 65 million. I think that capacity is much less relevant from our perspective as we enter into persistent global monitoring.

Rick Dunn: Yeah. Emiliano will elaborate on this, but no, I wouldn't make that assumption on $65 million. I think that capacity is much less relevant from our perspective as we enter into persistent global monitoring and intelligence. Emiliano can expand a bit on that. I think we talked about capacity at a time where we had a lot of it and a lot of data to sell, and we had a slightly different business model. With persistent global intelligence it's just much less relevant.

Speaker #3: And intelligence and Emiliano can expand a bit on that. But I think we talked about capacity at a time where we had a lot of it and a lot of data to sell.

Speaker #3: And we had a slightly different business model. With persistent global intelligence, it's just much less relevant.

Speaker #5: Yeah. No, look, I think there's the potential for significantly more than 65 million revenue with our existing constellation. And the data delivered from through out-of-observer and subscription programs so no, I don't think that's a reasonable cap.

Emiliano Kargieman: Yeah. No, look, I think there's the potential for significantly more than $65 million of revenue with our existing constellation on the data delivered through Aleph Observer and our subscription programs. No, I don't think that's a reasonable cap. There are several factors there. On one side, I would say we continue to have the largest unencumbered capacity in the market today. We are adding customers and increasing revenue, but that doesn't put a huge dent into the capacity in terms of what we can deliver in the future. Not so far. The other thing I would say is, you can expect that in many areas of the world where customers tend to cluster in terms of needs to monitor. We can deliver the same monitored sites to more than one customer.

Speaker #5: There are several factors there. On one side, I would say we continue to have the largest unencumbered capacity in the market today. And we are adding customers and increasing revenue, but we don't that doesn't put a huge dent into the capacity in terms of what we can deliver in the future, not so far.

Emiliano Kargieman: On one side, I would say we continue to have the largest unencumbered capacity in the market today. We are adding customers and increasing revenue, but that doesn't put a huge dent into the capacity in terms of what we can deliver in the future. Not so far. The other thing I would say is, you can expect that in many areas of the world where customers tend to cluster in terms of needs to monitor. We can deliver the same monitored sites to more than one customer.

Speaker #5: The other thing I would say is you can expect that in many areas of the world where customers tend to cluster in terms of needs to monitor, we can deliver the same monitored sites to more than one customer.

Speaker #5: So there's not a one-to-one relationship between the number of sites that we capture and the number of customers that we can serve, right? With the same number of sites that we're capturing, we can serve more than a single customer.

Emiliano Kargieman: There's not a one-to-one relationship between the number of sites that we capture and the number of customers that we can serve. Right? With the same number of sites that we're capturing, we can serve more than a single customer. Basically, I would say the potential is significantly.

Speaker #5: So basically, I would say the potential is significant.

Speaker #6: Okay. That's great. Tell her. Thank you. Thank you all. Thank you, Rick. Thank you, Emiliano.

Michael Latimore: Okay. That's great, Talar. Thank you. Thank you, all. Thank you, Rick. Thank you, Emiliano.

Speaker #3: Thank you, Alex.

Rick Dunn: Thank you, Michael.

Rick Dunn: Thank you, [Michael].

Speaker #4: Thank you. The next question we have come from is on ADAR of freedom capital markets. Please go ahead.

Operator: Thank you. The next question we have comes from Zhan Adar of Freedom Capital Markets. Please go ahead.

Operator: Thank you. The next question we have comes from [Zhan Adar] of Freedom Capital Markets. Please go ahead.

Zhan Adar: Hi, Emiliano. Hi, Rick. Thank you for taking my question, and I have a couple of them. First, you previously described about Space Systems pipeline of nearly $1 billion, and how much of it has a defined budget, maybe some procurement timeline or technical scope rather than still being early stage?

[Analyst] (Freedom Capital Markets): Hi, Emiliano. Hi, Rick. Thank you for taking my question, and I have a couple of them. First, you previously described about Space Systems pipeline of nearly $1 billion, and how much of it has a defined budget, maybe some procurement timeline or technical scope rather than still being early stage?

Speaker #7: Hi, Emiliano. Hi, Rick. Thank you for taking my question. And I have a couple of first, you previously described about space systems pipeline of nearly 1 billion and how much of it has a defined budget, maybe some procurement timeline or technical scope rather than still being an early stage?

Speaker #3: Well, yeah, our pipeline continues to be in that order of magnitude. And in order to make our pipeline, it all has a defined budget.

Rick Dunn: Well, yeah, our pipeline continues to be in that order of magnitude. In order to make our pipeline, it all has a defined budget. There's a customer with an identified need and a budget to move forward. They're all qualified opportunities from our perspective. I'm sorry, I lost the second part of your question.

Speaker #3: So there's a customer with an identified need and a budget. To move forward. So they're all qualified opportunities from our perspective. And I'm sorry, I lost the second part of your question.

Zhan Adar: Is the budget still being in early stage or?

[Analyst] (Freedom Capital Markets): Is the budget still being in early stage or?

Speaker #7: Is the budget is still being is in early stage or?

Speaker #3: I mean, I think you're asking I'm not sure what you're asking. But I'll try and answer it. Anyway, the pipeline, each deal in the pipeline is at a different stage depending on the customer and the length of time we've been talking to them.

Rick Dunn: I'm not sure what you're asking, but I'll try and answer it. Anyway, each deal in the pipeline is at a different stage, depending on the customer and the length of time we've been talking to them and their ability and desire to move more quickly than more slowly. Each one of these sovereign deals is very unique. The buyer is very unique. The process is unique. How long they take to convert is sort of all over the map. On a Space Systems deal, we've converted them as quickly as four to six months and as long as three years. With data and analytics, those tend to convert much quicker, and they don't really linger on the pipeline that long because there's typically a process and the customer either makes a data buy from us or they don't. Then they cycle off the pipeline.

Speaker #3: And they're their ability to move and desire to move more quickly than more slowly. So each one of these sovereign deals is very unique.

Speaker #3: The buyer is very unique. Their process is unique. And how long they take to convert is sort of all over the map. We can, on a space systems deal, we've done them as quickly as we've converted them as quickly as four to six months.

Rick Dunn: On a Space Systems deal, we've converted them as quickly as four to six months and as long as three years. With data and analytics, those tend to convert much quicker, and they don't really linger on the pipeline that long because there's typically a process and the customer either makes a data buy from us or they don't. Then they cycle off the pipeline.

Speaker #3: And as long as three years. With data and analytics, those tend to convert much quicker. And they don't really linger on the pipeline that long because there's typically a process.

Speaker #3: And the customer either makes a data buy from us or they don't. And then they cycle off the pipeline. Hopefully, that answered your question.

Rick Dunn: Hopefully that answered your question.

Zhan Adar: Okay, thanks. I appreciate it. That's really helpful. The second one is related to defense missions. For which defense missions does 1 meter resolution data coverage remain sufficient? Where customers is increasingly requiring the better resolution imagery qualify for procurement?

Speaker #7: Okay. Thanks. I appreciate it. That's really helpful. So and the second one is related to defense missions. So for which defense missions does one meter resolution data coverage remain sufficient?

[Analyst] (Freedom Capital Markets): Okay, thanks. I appreciate it. That's really helpful. The second one is related to defense missions. For which defense missions does 1m resolution data coverage remain sufficient? Where customers is increasingly requiring the better resolution imagery qualify for procurement?

Speaker #7: And where customers is increasingly requiring the better resolution imagery for qualify for procurement?

Emiliano Kargieman: Yeah, I can take that, Zhan. Thank you. Our current constellation delivering 50 cm resolution imagery is really at the sweet spot of the requirements for most defense customers. If you ask customers, they will always want the highest possible resolution. If you can deliver 30 cm, they will want 30 cm. If you can deliver 15 cm, they would probably want them, too. The real point here is you need to be able to deliver the imagery over the sites that they're interested in monitoring. 30 cm resolution imagery is fantastic, but if you can only deliver one image every three days to the customer, then it doesn't really fit an operational demand.

Speaker #5: that and thank you. So our current constellation delivering 50 centimeter resolution imagery is really at the sweet spot of the requirements for most defense customers.

Speaker #5: And if you ask customers, they will always want the highest possible resolution. If you can deliver 30 centimeters, they will want 30 centimeters. If you can deliver 15 centimeters, they will probably want them too.

Emiliano Kargieman: The real point here is you need to be able to deliver the imagery over the sites that they're interested in monitoring. 30cm resolution imagery is fantastic, but if you can only deliver one image every three days to the customer, then it doesn't really fit an operational demand. I think what we're doing with Aleph Observer and our persistent global intelligence infrastructure in general, by being able to deliver consistent imagery on a daily basis over thousands of sites to our customers, we are giving them the ability to look at things that they've never been able to see before. Right?

Speaker #5: The real point here is you need to be able to deliver the imagery over the sites that they're interested in monitoring. So 30 centimeter resolution imagery is fantastic, but if you can only deliver one image every three days, to the customer, then it doesn't really fit in operational demand.

Speaker #5: I think what we're doing with out-of-observer and/or persistent global intelligence infrastructure in general by being able to deliver consistent imagery on a daily basis over thousands of sites to our customers, we are giving them the ability to look at things that they've never been able to see before, right?

Emiliano Kargieman: I think what we're doing with Aleph Observer and our persistent global intelligence infrastructure in general, by being able to deliver consistent imagery on a daily basis over thousands of sites to our customers, we are giving them the ability to look at things that they've never been able to see before. Right? More than resolution, I think what is important here is the actionability. What can you see in the images, right? It's not a number. It's what can you see there. Is the equipment there? Is the aircraft carrier where it was before? Is the submarine where it was before? Have things moved? This kind of situational awareness on a daily basis that Aleph Observer empowers our customers to do is something very new. I think that's where the value lies, more than in any specific number in terms of resolution or anything else.

Speaker #5: So more than resolution, I think, what is important here is the actionability. What can you see in the images, es, right? It's not a number.

Emiliano Kargieman: More than resolution, I think what is important here is the actionability. What can you see in the images, right? It's not a number. It's what can you see there. Is the equipment there? Is the aircraft carrier where it was before? Is the submarine where it was before? Have things moved? This kind of situational awareness on a daily basis that Aleph Observer empowers our customers to do is something very new. I think that's where the value lies, more than in any specific number in terms of resolution or anything else.

Speaker #5: It's what can you see there? Is the equipment there? Is the aircraft carrier where it was before? Is the submarine where it was before?

Speaker #5: Have things moved? This kind of situational awareness on a daily basis that out-of-observer empowers our customers to do is something very new. And I think that's where the value lies.

Speaker #5: More than in any specific number in terms of resolution or anything else.

Zhan Adar: Okay, thanks. I appreciate it.

[Analyst] (Freedom Capital Markets): Okay, thanks. I appreciate it.

Speaker #7: Okay. Thanks. I appreciate it.

Speaker #4: Thank you. At this stage, there seems to be no further questions. I will now hand the call over to Emilio for closing remarks. Please go ahead.

Operator: Thank you. At this stage, there seems to be no further questions. I will now hand the call over to Emiliano for closing remarks. Please go ahead.

Speaker #5: Thank you. Operator. And thank you all for joining us today. The second quarter was the quarter that Satellogic crossed over. We are building the infrastructure for persistent global intelligence continuous proactive awareness of the places, assets, and activities that matter.

Emiliano Kargieman: Thank you, operator. Thank you all for joining us today. The Q2 was the quarter that Satellogic took us over. We are building the infrastructure for persistent global intelligence, continuous proactive awareness of the places, assets, and activities that matter. We intend to lead this category as it forms, and we look forward to updating all of you on our progress next quarter. If we were unable to address any of your questions today, please reach out to our investor relations team at ir@satellogic.com. Thank you, and have a good afternoon.

Speaker #5: We intend to lead this category as it forms. And we look forward to updating all of you on our progress next quarter. If we were unable to address any of your questions today, please reach out to our investor relations team at ir@satellogic.com.

Speaker #5: Thank you and have a good afternoon.

Operator: Thank you. Ladies and gentlemen, that then concludes today's conference. Thank you for joining us. You may now disconnect your lines.

Q2 2026 Satellogic Inc Earnings Call

Request DemoDemo

Satellogic

Earnings