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Ast Spacemobile, Inc. (ASTS) SEC Filing 10-Q Quarterly Report for the period ending Thursday, September 30, 2021

Ast Spacemobile, Inc.

CIK: 1780312 Ticker: ASTS

 

Exhibit 99.1

 

PRESS RELEASE

 

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Description automatically generated

 

AST SpaceMobile Provides Third Quarter 2021 Business Update

 

MIDLAND, TX, November 15, 2021 – AST SpaceMobile, Inc. (“AST SpaceMobile”) (NASDAQ: ASTS), the company building the first and only space-based cellular broadband network accessible directly by standard mobile phones, today provided its business update for the third quarter of 2021.

 

“Since our last quarterly business update, we have made significant progress and we are now entering the last stage of build, integration and testing of our next satellite, BlueWalker 3,” said Abel Avellan, Chairman and CEO of AST SpaceMobile.

 

Abel added, “Today, we are very pleased to announce that we have entered into an agreement to purchase an additional 100,000 square foot facility in Midland, Texas, complementing our existing 85,000 square foot headquarters facility. This is an important step for the industrialization of our technology, as this will provide us the potential capacity to reach our production goal of six satellites per month.”

 

Business Highlights

 

  Our next satellite, BlueWalker 3, a 693-square-foot phased array for planned direct-to-cell phone connectivity at 4G/5G speeds, is going through final integration and testing, with all components for the build now on hand
  Midland, Texas headquarters buildout is completed with approximately 35,000 square feet of clean room for assembly, as well as test equipment to support production requirements
  Entered into an agreement to purchase an additional 100,000 square foot facility in Midland, Texas, which, together with our headquarters facility, will provide a combined 185,000 square feet of capacity

 

 
 

 

  Signed a lease for approximately 16,000 square feet of new space for our Maryland Technology Center, intended to be the future home of our Satellite Operations Center and Network Operations Center
  Signed Memoranda of Understanding (“MOUs”) with MTN Group (Africa, Middle East), YTL Communications (Malaysia) and Somcable (Somaliland)
  Growth of 40 employees across all offices in the third quarter of 2021, with a team of 509 as of September 30, 2021, including 301 full-time employees, 47 full-time contractors and 161 employees of 3rd party engineering service providers working on AST SpaceMobile

 

Third Quarter 2021 Financial Highlights

 

  Ended the third quarter with cash and cash equivalents of $360.4 million and no financial debt as of September 30, 2021
  Total operating expenses of $23.1 million for the third quarter of 2021, compared to $25.1 million in the second quarter of 2021, primarily due to a decrease in research and development costs of $4.7 million, partially offset by $2.2 million increase in engineering services, $0.4 million in depreciation and amortization, and $0.1 million in general and administration expenses
  As of September 30, 2021, invested $56.7 million in the construction of BlueWalker 3 satellite, which includes non-recurring engineering development cost, satellite componentry, and launch cost
  As of September 30, 2021, invested $19.9 million in property and equipment, net of accumulated depreciation, primarily in the buildout of the headquarters facility in Midland, Texas

 

Conference Call Information

 

AST SpaceMobile will hold a quarterly business update conference call at 5:00 p.m. (Eastern Time) today, November 15, 2021. The call will be accessible via a live webcast on the Events page of AST SpaceMobile’s Investor Relations website at https://investors.ast-science.com/. An archive of the webcast will be available shortly after the call.

 

About AST SpaceMobile

 

AST SpaceMobile is building the first and only global cellular broadband network in space to operate directly with standard, unmodified mobile devices based on our extensive IP and patent portfolio. Our engineers and space scientists are on a mission to eliminate the connectivity gaps faced by today’s five billion mobile subscribers and finally bring broadband to the billions who remain unconnected.

 

For additional information or to be added to our investor relations email alerts list, please visit us at https://investors.ast-science.com/ir-resources/email-alerts.

 

 
 

 

Forward-Looking Statements

 

This communication contains “forward-looking statements” that are not historical facts, and involve risks and uncertainties that could cause actual results of AST SpaceMobile to differ materially from those expected and projected. These forward-looking statements can be identified by the use of forward-looking terminology, including the words “believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,” “will,” “would,” “potential,” “projects,” “predicts,” “continue,” or “should,” or, in each case, their negative or other variations or comparable terminology.

 

These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside AST SpaceMobile’s control and are difficult to predict. Factors that may cause such differences include, but are not limited to: (i) expectations regarding AST SpaceMobile’s strategies and future financial performance, including AST’s future business plans or objectives, expected functionality of the SpaceMobile Service, anticipated timing and level of deployment of satellites, anticipated demand and acceptance of mobile satellite services, prospective performance and commercial opportunities and competitors, the timing of obtaining regulatory approvals, ability to finance its research and development activities, commercial partnership acquisition and retention, products and services, pricing, marketing plans, operating expenses, market trends, revenues, liquidity, cash flows and uses of cash, capital expenditures, and AST’s ability to invest in growth initiatives; (ii) the negotiation of definitive agreements with mobile network operators relating to the SpaceMobile service that would supersede memoranda of understanding; (iii) the ability of AST SpaceMobile to grow and manage growth profitably and retain its key employees and AST SpaceMobile’s responses to actions of its competitors and its ability to effectively compete; (iv) changes in applicable laws or regulations; (v) the possibility that AST SpaceMobile may be adversely affected by other economic, business, and/or competitive factors; (vi) the outcome of any legal proceedings that may be instituted against AST SpaceMobile; and (vii) other risks and uncertainties indicated in the Company’s filings with the SEC, including those in the Risk Factors section of AST SpaceMobile’s Form S-1 Registration Statement filed with the SEC on June 25, 2021 (File No. 333-257425) as well as the Risk Factors contained in Part II, Item 1A of AST SpaceMobile’s Form 10-Q dated August 16, 2021.

 

AST SpaceMobile cautions that the foregoing list of factors is not exclusive. AST SpaceMobile cautions readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors incorporated by reference into AST SpaceMobile’s Form S-1 Registration Statement filed with the SEC on June 25, 2021 (File No. 333-257425) as well as the Risk Factors contained in Part II, Item 1A of AST SpaceMobile’s Form 10-Q dated August 16, 2021. AST SpaceMobile’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, AST SpaceMobile disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

 

 
 

 

Third Quarter 2021 Financial Results

 

AST SPACEMOBILE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(dollars in thousands, except per share data)

 

   September 30, 2021   December 31, 2020 
         
ASSETS          
Current assets:          
Cash and cash equivalents  $360,390   $42,777 
Accounts receivable   1,282    2,081 
Inventory   2,726    2,591 
Prepaid expenses   4,119    1,249 
Other current assets   2,072    2,234 
Total current assets   370,589    50,932 
           
Property and equipment:          
BlueWalker 3 Satellite - construction in progress   56,677    27,013 
Property and equipment, net   19,909    10,057 
Total property and equipment, net   76,586    37,070 
           
Other non-current assets:          
Operating lease right-of-use assets   6,783    7,045 
Intangible assets, net   335    526 
Goodwill   3,704    3,912 
Other assets and deposits   3,010    160 
Total other non-current assets   13,832    11,643 
           
TOTAL ASSETS  $461,007   $99,645 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities:          
Accounts payable  $6,656   $4,990 
Accrued expenses and other current liabilities   3,377    4,222 
Deferred revenue   4,850    3,401 
Current operating lease liabilities   495    504 
Total current liabilities   15,378    13,117 
           
Warrant liabilities   76,108    - 
Non-current operating lease liabilities   6,433    6,541 
Total liabilities   97,919    19,658 
           
Commitments and contingencies (Note 6)          
           
Stockholders’ Equity          
Class A common stock, $.0001 par value, 800,000,000 shares authorized, 51,729,704 shares issued and outstanding as of September 30, 2021   5    - 
Class B common stock, $.0001 par value, 200,000,000 shares authorized, 51,636,922 shares issued and outstanding as of September 30, 2021   5    - 
Class C common stock, $.0001 par value, 125,000,000 shares authorized, 78,163,078 shares issued and outstanding as of September 30, 2021   8    - 
           
Additional paid-in capital   169,385    - 
Common equity (pre-combination)   -    117,573 
Accumulated other comprehensive loss   (394)   (168)
Accumulated deficit   (67,351)   (39,908)
Noncontrolling interest   261,430    2,490 
Total stockholders’ equity   363,088    79,987 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $461,007   $99,645 

 

 
 

 

AST SPACEMOBILE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(dollars in thousands, except per share data)

 

   Three Months Ended
September 30,
   Nine Months Ended
September 30,
 
   2021   2020   2021   2020 
                 
Revenues  $2,450   $2,090   $6,185   $3,265 
                     
Cost of sales (exclusive of items shown separately below)   2,103    833    4,122    2,634 
                     
Gross profit   347    1,257    2,063    631 
                     
Operating expenses:                    
Engineering services   8,026    3,502    18,757    8,426 
General and administrative costs   9,331    2,825    24,031    7,638 
Research and development costs   4,888    17    15,491    60 
Depreciation and amortization   867    112    2,049    417 
Total operating expenses   23,112    6,456    60,328    16,541 
                     
Other income (expense):                    
Changes in fair value of warrant liabilities   39,401    -    (2,276)   - 
Interest income, net   4    14    12    58 
Other income (expense), net   180    4    144    (2)
Total other income (expense), net   39,585    18    (2,120)   56 
                     
Income (loss) before income tax expense   16,820    (5,181)   (60,385)   (15,854)
Income tax expense   16    -    73    - 
Net income (loss) before allocation to noncontrolling interest   16,804    (5,181)   (60,458)   (15,854)
                     
Net income (loss) attributable to noncontrolling interest   12,689    350    (33,015)   (327)
Net income (loss) attributable to common stockholders  $4,115   $(5,531)  $(27,443)  $(15,527)
Net income (loss) per share of common stock attributable to common stockholders (1)                    
Basic  $0.08    N/A   $(0.31)   N/A 
Diluted  $0.07    N/A   $(0.31)   N/A 
Weighted average shares used in computing net income (loss) per share of common stock (1)                    
Basic   51,729,704    N/A    51,729,704    N/A 
Diluted   51,839,841    N/A    51,729,704    N/A 

 

(1) Earnings per share information has not been presented for periods prior to the Business Combination as it resulted in values that would not be meaningful to the readers of the unaudited condensed consolidated financial statements. Refer to Note 12 in the Notes to the Condensed Consolidated Financial Statements (Unaudited) included in our Form 10-Q for the quarter ended September 30, 2021 for further information.

 

 
 

 

AST SPACEMOBILE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

(dollars in thousands)

 

   Three Months Ended
September 30,
   Nine Months Ended
September 30,
 
   2021   2020   2021   2020 
                 
Net income (loss) before allocation to noncontrolling interest  $16,804   $(5,181)  $(60,458)  $(15,854)
Other comprehensive (loss) income                    
Foreign currency translation adjustments   (220)   294    (494)   254 
Total other comprehensive (loss) income   (220)   294    (494)   254 
Total comprehensive income (loss) before allocation to noncontrolling interest   16,584    (4,887)   (60,952)   (15,600)
Comprehensive income (loss) attributable to noncontrolling interest   12,490    472    (33,283)   (217)
Comprehensive income (loss) attributable to common stockholders  $4,094   $(5,359)  $(27,669)  $(15,383)

 

 
 

 

AST SPACEMOBILE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(dollars in thousands)

 

   Nine Months Ended September 30, 
   2021   2020 
         
Cash flows from operating activities:          
Net loss before allocation to noncontrolling interest  $(60,458)  $(15,854)
Adjustments to reconcile net loss before noncontrolling interest to cash used in operating activities:          
Depreciation   1,878    251 
Amortization of intangible assets   171    166 
Change in fair value of warrant liabilities   2,276    - 
Non-cash lease expense   505    221 
Stock-based compensation   1,899    409 
Changes in operating assets and liabilities:          
Accounts receivable   710    (406)
Prepaid expenses and other current assets   (2,700)   (1,183)
Inventory   (282)   (1,613)
Accounts payable and accrued expenses   (1,069)   3,310 
Operating lease liabilities   (354)   (221)
Deferred revenue   1,662    1,981 
Other assets and liabilities   (2,850)   (122)
Net cash used in operating activities   (58,612)   (13,061)
           
Cash flows from investing activities:          
Purchase of property and equipment   (11,293)   (3,710)
BlueWalker 3 Satellite - construction in process   (29,201)   (17,007)
Net cash used in investing activities   (40,494)   (20,717)
           
Cash flows from financing activities:          
Proceeds from Business Combination   456,420    - 
Direct and incremental costs incurred for the Business Combination   (39,542)   - 
Repayment for founder bridge loan   -    (1,750)
Proceeds from issuance of Series B Preferred Stock   -    79,833 
Issuance costs from issuance of Series B Preferred Stock   -    (7,745)
Net cash provided by financing activities   416,878    70,338 
           
Effect of exchange rate changes on cash   (159)   16 
           
Net increase in cash and cash equivalents   317,613    36,576 
Cash and cash equivalents, beginning of period   42,777    26,498 
Cash and cash equivalents, end of period  $360,390   $63,074 
           
Supplemental disclosure of cash flow information:          
Non-cash transactions:          
Purchases of construction in process in accounts payable  $2,266   $1,163 
Purchases of property and equipment in accounts payable   1,306    - 
Right-of-use assets obtained in exchange for operating lease liabilities as of January 1, 2020 upon adoption of ASC 842   -    6,472 

 

 


The following information was filed by Ast Spacemobile, Inc. (ASTS) on Monday, November 15, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Ast Spacemobile, Inc.'s 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Cover
Condensed Consolidated Balance Sheets (Unaudited)
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical)
Condensed Consolidated Statements Of Cash Flows (Unaudited)
Condensed Consolidated Statements Of Comprehensive Income (Loss) (Unaudited)
Condensed Consolidated Statements Of Operations (Unaudited)
Condensed Consolidated Statements Of Stockholders' Equity (Unaudited)
Condensed Consolidated Statements Of Stockholders' Equity (Unaudited) (Parenthetical)
Business Combination
Business Combination (Details Narrative)
Commitments And Contingencies
Commitments And Contingencies (Details Narrative)
Commitments And Contingencies (Tables)
Fair Value Measurement
Fair Value Measurement (Details Narrative)
Fair Value Measurement (Tables)
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Details Narrative)
Goodwill And Intangible Assets (Tables)
Income Taxes
Income Taxes (Details Narrative)
Net Income (Loss) Per Share
Net Income (Loss) Per Share (Details Narrative)
Net Income (Loss) Per Share (Tables)
Organization And Nature Of Operations
Organization And Nature Of Operations (Details Narrative)
Property And Equipment
Property And Equipment (Details Narrative)
Property And Equipment (Tables)
Related Parties
Related Parties (Details Narrative)
Revenue
Revenue (Details Narrative)
Revenue (Tables)
Schedule Of Assets Measured At Fair Value On A Recurring Basis (Details)
Schedule Of Basic And Diluted Earnings Per Share (Details)
Schedule Of Disaggregation Of Revenue (Details)
Schedule Of Estimated Useful Lives (Details)
Schedule Of Intangible Assets (Details)
Schedule Of Intangible Assets Future Amortization Expense (Details)
Schedule Of Lease Expense (Details)
Schedule Of Maturities Of Operating Lease Liabilities (Details)
Schedule Of Option Award Estimated Using A Black-Scholes Option-Pricing Model Assumptions (Details)
Schedule Of Property And Equipment, Net (Details)
Schedule Of Share-Based Compensation Expense (Details)
Schedule Of Stock Options Activities (Details)
Schedule Of Supplemental Balance Sheet Information Related To Leases (Details)
Schedule Of Supplemental Cash Flow Information Related To Leases (Details)
Schedule Of Unvested Option Activity (Details)
Schedule Of Unvested Restricted Stock Units Activity (Details)
Stock-Based Compensation
Stock-Based Compensation (Details Narrative)
Stock-Based Compensation (Tables)
Stockholders??? Equity
Stockholders??? Equity (Details Narrative)
Subsequent Events
Subsequent Events (Details Narrative)
Summary Of Changes In Carrying Amount Of Goodwill (Details)
Summary Of Significant Accounting Policies
Summary Of Significant Accounting Policies (Details Narrative)
Summary Of Significant Accounting Policies (Policies)
Summary Of Significant Accounting Policies (Tables)
Warrant Liabilities
Warrant Liabilities (Details Narrative)
Ticker: ASTS
CIK: 1780312
Form Type: 10-Q Quarterly Report
Accession Number: 0001493152-21-028642
Submitted to the SEC: Mon Nov 15 2021 4:31:35 PM EST
Accepted by the SEC: Mon Nov 15 2021
Period: Thursday, September 30, 2021
Industry: Communications Services

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