Earnings call transcript: AST SpaceMobile Q2 2025 misses revenue expectations

AST SpaceMobile reported its second-quarter 2025 earnings, revealing a significant revenue shortfall, while its stock experienced a slight decline. The company’s earnings per share (EPS) were lower than anticipated, with actual EPS at -$0.41 compared to the forecast of -$0.21, marking a 95.24% negative surprise. Revenue came in at $1.15 million, falling short of the expected $5.56 million, a 79.32% miss. According to InvestingPro data, the company maintains strong liquidity with a current ratio of 10.62, indicating robust short-term financial health despite the earnings miss. Following the announcement, AST SpaceMobile’s stock declined by 0.71 points, or 1.52%, closing at $46.63, with further aftermarket adjustments pushing it down by an additional 0.75%. InvestingPro analysis shows the stock has been notably volatile, with a beta of 2.32, while delivering strong returns of over 116% in the past year. The company’s current market capitalization stands at $11.62 billion. InvestingPro subscribers can access 12 additional key insights about ASTS’s valuation and momentum metrics.

Key Takeaways

• AST SpaceMobile’s Q2 2025 revenue fell significantly short of expectations.
• EPS was lower than forecasted, surprising analysts negatively.
• The company’s stock declined by 1.52% following the earnings release.
• AST SpaceMobile continues to focus on expanding its satellite capabilities.
• The company maintains a robust cash position with over $1.5 billion.

Company Performance

AST SpaceMobile’s performance in Q2 2025 was marked by significant challenges, particularly in meeting revenue expectations. Despite the shortfall, the company continues to invest heavily in its satellite infrastructure, reflecting its commitment to expanding capabilities and market reach. InvestingPro data reveals the company holds more cash than debt on its balance sheet, providing financial flexibility for its expansion plans. Analysts project significant sales growth for the current year, with revenue expected to grow by nearly 13%. Get detailed insights into ASTS’s growth potential with InvestingPro’s comprehensive research report, part of our coverage of 1,400+ US stocks. The company’s strategic focus remains on bridging cellular coverage gaps globally, a market with significant potential.

Financial Highlights

• Revenue: $1.15 million, down significantly from the forecasted $5.56 million.
• Earnings per share: -$0.41, compared to a forecast of -$0.21.
• Operating expenses: $51.7 million, up from $44.9 million in Q1 2025.
• Capital expenditures: $323 million, a substantial increase from $124 million previously.

Earnings vs. Forecast

AST SpaceMobile’s Q2 2025 earnings were below expectations, with an EPS of -$0.41 against a forecast of -$0.21. This 95.24% surprise reflects a larger-than-anticipated loss. Revenue also missed significantly, coming in at $1.15 million compared to the expected $5.56 million, representing a 79.32% shortfall.

Market Reaction

Following the earnings announcement, AST SpaceMobile’s stock decreased by 1.52% to $46.63. In aftermarket trading, the stock fell an additional 0.75%, reflecting investor concerns over the revenue miss and EPS results. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading above its intrinsic value. Analyst price targets range from $30 to $64, with a consensus recommendation leaning towards Buy. Discover more detailed valuation metrics and 14 additional ProTips with an InvestingPro subscription. The stock’s movement is within its 52-week range of $17.5 to $60.95, indicating ongoing volatility.

Outlook & Guidance

The company projects Q3 adjusted operating expenses of approximately $50 million and capital expenditures between $225 million and $300 million. AST SpaceMobile expects 2025 revenue to range from $50 million to $75 million, indicating a focus on scaling operations and increasing satellite deployments.

Executive Commentary

CEO Abel Avalon emphasized AST SpaceMobile’s unique position, stating, "We are building the first and only global cellular broadband network in space to operate directly with everyday unmodified mobile devices." He highlighted the company’s strategic use of spectrum as a key competitive advantage.

Risks and Challenges

• Revenue shortfalls may impact future investment capabilities.
• High capital expenditures could strain financial resources.
• Market competition in satellite broadband is intensifying.
• Regulatory challenges in spectrum allocation may pose hurdles.
• Economic uncertainties could affect market demand and expansion plans.

Q&A

During the Q&A session, analysts queried the company’s ability to fund its satellite constellation expansion. Management confirmed sufficient funding for the planned 45-60 satellite constellation, signaling confidence in meeting future operational goals.

Full transcript - Ast Spacemobile Inc (ASTS) Q2 2025:

Conference Operator: Good day and thank you for standing by. Welcome to the AST Space Mobile Second Quarter twenty twenty five Business Update Call. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your host today, Scott Wisniewski, President of AST Space Mobile. Please go ahead.

Scott Wisniewski, President, AST SpaceMobile: Thank you and good afternoon everyone. Today, I’m also joined by Chairman and CEO, Abel Avalon and our Chief Financial Officer, Andy Johnson. Let me refer you to Slide two of the presentation, which contains our Safe Harbor disclaimer. During today’s call, we may make certain forward looking statements. These statements are based on current expectations and assumptions and as a result are subject to risks and uncertainties.

Many factors could cause actual events to differ materially from the forward looking statements on this call. For more information about these risks and uncertainties, please refer to the Risk Factors section of AST Space Mobile’s annual report on Form 10 ks for the year that ended 12/31/2024, Form 10 Q filed with the SEC on 05/12/2025, and Form 10 Q filed with the SEC on 08/11/2025, all with the Securities and Exchange Commission and other documents filed by AST Space Mobile with the SEC from time to time. Also, after our initial remarks, we will be starting our Q and A section with questions submitted in advance by our shareholders. For those of you who may be new to our company and mission, there are over 5,000,000,000 mobile phones in use today around the world, but many of us still experience gaps in coverage as we live, work, and travel. Additionally, there are billions of people without cellular broadband and who remain unconnected to the global economy.

The markets we are pursuing are massive and the problem we are solving is important and touches nearly all of us. In this backdrop, ASD Space Mobile is building the first and only global cellular broadband network in space to operate directly with everyday unmodified mobile devices and supported by our extensive IP and patent portfolio. It is my pleasure to now pass over to Chairman and CEO, Abel Avalon, who will go through our activities since our last public update.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Thank you, Scott. The second quarter was one of our most productive quarters ever for HD Space Mobile. We note our progress to the date across many important areas, including manufacturing, regulatory, commercial and government efforts, capital raising and readiness for intermittent nationwide service in United States by the end of this year. Just three months ago, I highlighted that the company had reached an inflection point as we progress towards scale commercialization of our network. Since our first quarter conference call, we have made significant advances in our commercialization initiative, while continuing to secure highly valuable spectrum creating a further barrier for entry when combined with our portfolio of over 3,700 patents and patent pending claims.

This progress comes as we continue to improve our manufacturing program, including the chipping of the largest satellites ever created for low death orbits. I am increasingly confident in our direction, strategy and position in the growing direct to device cellular broadband market that we created. I want to cover several updates, including highlights of the past few months before Scott and Andy discuss the details. As of today, we have completed the assembly of microns and phase arrays for eight Block II Blue Bird satellites in addition to six we currently have in operations and expected to complete assembly of approximately 40 satellites equivalents of microns and phased array by early twenty twenty six. Our differentiated approach to satellite manufacturing with 95% vertical integration remains on track to reach a manufacturing cadence of six satellites per month during 2025.

And now globally, we will soon have a manufacturing footprint with over 400,000 square feet of manufacturing space supported by a great team of over 1,200 global workforce. We currently anticipate at least five Orbital launches by the 2026, with Orbital launches occurring every one to two months on average to reach our goal of 45 to 60 satellites launches during 2025 and 2026, which will drive continuous coverage in key markets such as United States, Europe, Japan, U. S. And other strategic markets like The U. S.

Government. Regarding our orbital launch campaign, FN1, our first next generation Block II Blue Bird satellite will be ready to ship in August. We’re working with our launch provider on determining the earliest possible launch date. A detailed cadence of our 2025 and 2026 deployment plan is now shown in the accompanying quarterly presentation found on our IR website. Our Block two Bluebirds are approximately three and a half times larger with 10 times capacity as compared to our Block one Bluebirds.

We previously held the record for the largest ever commercial deployed communication satellite ever put in loaded orbits. This means our phase out rate or antenna have much larger surface area than before, enabling our satellite to digitally form more cells over air surface with pinpoint precision and reduce interference. As a result, we need far less satellites to achieve our goal of connecting the unconnected. Approximately 45 to 60 satellites for continuous coverage in key markets and approximately 90 satellites for continuous global coverage. This compared with other systems that needs tens of thousands of satellites and even then, we believe our superior technology, deep partnerships, access to low band and premium band spectrum and commercialization strategy will enable a better experience and deliver greater value to customers.

For ST Space mobile, providing native cellular broadband capability at scale is a function of the number of Blue Bird satellites in orbit. We have laid out a strong launch cadence to match our connectivity goals. Our satellites provide native cellular broadband capability directly to modify mobile devices including voice, text, data and video. As consumers, this means broader cellular coverage, lower latency and better the signal quality as you live, work and travel. These capabilities have been proven multiple times in partnership with our MNO partners.

Simultaneously, we’re continuing to bring together a network of MNO partners that is second to none. Our commercial ecosystem, which include agreements and understanding with over 50 MNO partners with nearly 3,000,000,000 subscribers globally represent a robust network of potential space mobile service consumers. As our commercialization and manufacturing initiative advance, we’re laying the groundwork for commercial service with activations in key partner markets. We’re preparing to deploy nationwide interim to service in United States by the end of this year with our U. S.

MNO partners AT and T and Verizon, followed by The United Kingdom, Japan and Canada in Q1 twenty twenty six. We also completed key milestones from our U. S. Government contract awards and continued strong regulatory progress on spectrum related topics. Of note, we demonstrated the first tactical non terrestrial network or NTN connectivity over standard mobile devices with participation from multiple branches of the U.

S. Armed Forces. Our cellular spectrum strategy has also been significantly enhanced. We recently announced an agreement to acquire 60 megahertz of global S band spectrum priority rights held under the International Telecommunications Union. This spectrum priority right provide us with path to offer services in the spectrum band around the world, subject to country level regulatory approvals.

Access to S band spectrum rights complement our plan L spectrum strategy in The U. S. And Canada and enhance our core 3GPP spectrum strategy that we deploy globally. Together with our network operator partners, we are in a position to expand subscriber capacity by offering the vast majority of countries around the world the full AST Mobile network capabilities, enabling a true broadband experience directly from space to everyday smartphone. Premium spectrum is both limited, valuable and gaining factor in achieving commercial scalability.

Our strategy to work with MNOs and utilize their existing low band spectrum, while maintaining this capacity with our own spectrum create a durable competitive advantage around our business. Lastly, we’re better capitalized than ever before with over $1,500,000,000 in cash on the balance sheet, pro form a for our recent convertible note and ATM facility. Through a series of differentiated transaction, we have fortified our balance sheet to build our network and manage our capital structure in responsible way while we cultivate long term shareholder value. The 2025 have been keenly focused in advancing satellite production and manufacturing. Our pace of innovation is reflected on the dedicated work, strategic planning and unrivaled focus driven by our talented team of over 1,200 global workforce.

With the achievement of our first Block two Blue Birds soon and subsequent start of our Orbital launch campaign, we’re moving with precision to scale the number of Blue Bird satellites in low dead orbits and expand our global cellular broadband network. This is an exciting time for ST Spacemobile and I thank you for your continued support. Let me now turn the call over to Scott to provide more detail on progress and initiative.

Scott Wisniewski, President, AST SpaceMobile: Thank you, Abel. The past few months have been extremely active for AST Space Mobile. Let me elaborate on our recent accomplishments, what they mean for the company’s overall progress, and what that means for the rest of our year. Our recent agreement with Vodafone Idea in India shows the continued and growing demand for SpaceMobile service across both consumer and enterprise use cases. Additionally, we continue to engage in conversations with players in several other key strategic markets and expect to announce updates on this front soon.

In Europe, our jointly owned distribution entity with Vodafone is progressing on plan. We recently chose Luxembourg as our headquarters. The country’s strong digital credentials and strategic location make it an ideal place for SATCO to distribute AST SpaceMobile’s broadband satellite services to European mobile network operators under a single turnkey arrangement. The demand signals so far for a sovereign integrated direct to device satellite service are increasingly evident with expressions of interest from 21 of 27 EU member states as well as in other European markets. Moving to gateways, in Q2, we delivered gateway equipment bookings of $14,900,000 a sequential increase primarily driven by the accelerated deployment of our global network infrastructure.

The pace of bookings in the quarter is a promising indicator of demand ahead of rollout of our SpaceMobile service. We continue to expect quarterly bookings of approximately $10,000,000 on average during the 2025 as we begin to recognize revenue as and when gateways are installed and milestones are met. Furthermore, gateway sales and government contract awards, which I will speak to momentarily, provide us with reassurance that we remain on track with expected revenue in the second half of the year of $50,000,000 to $75,000,000 Now to The U. S. Government business.

Our dual use satellite technology continues to garner interest from U. S. Defense and government entities. In Q2, we recognized revenue on four milestones related to contract awards with The U. S.

Government. We also won two additional early stage contracts in the quarter, bringing the total to eight contracts to date with the U. S. Government as an end customer, showing broad based interest across the DoD for use cases uniquely available with our satellite technology and we fully expect to participate in processes for large contracts going forward. We expect revenue from our U.

Government business to ramp significantly in the coming quarters as we continue to achieve milestones tied to our current contract awards in addition to winning net new contract awards. Our government pipeline remains robust as the opportunities for collaboration become clearer. As a commitment to our promising government business, we are significantly expanding our organizational capabilities to serve the U. S. Government.

Organizationally, this will streamline objectives, refine strategies and better align resources in an effort to grow our government business to substantial revenue streams. We have strong conviction of our opportunities across government and defense use cases, driven by our unique and differentiated satellite technology paired with the growing demand for both communications and non communications applications that we’ve seen. The achievements of this quarter serve as important signals of our continued positive momentum. We are proud of our progress to date and are energized by the opportunity to remain firmly in the driver’s seat of what has already been an incredible journey to date, and we’re really excited about the additional commercial progress ahead of us. I will now pass the room over to Andy to walk through our financial update.

Andy Johnson, Chief Financial Officer, AST SpaceMobile: Thanks, Scott, and good afternoon, everyone. Our performance during the 2025 reflects our continuing evolution to a full fledged operating company, executing at scale to facilitate our bold manufacturing and launch objectives during 2025 and 2026. All of this hard work is in support of our near term revenue ramp for both commercial and U. S. Government opportunities that I first discussed with you last quarter.

The progress on manufacturing the next 40 Bluebird Block II satellites continued throughout the second quarter. One of the most significant highlights from Q2 was our work on the financial front in support of these operational efforts, which I’ll discuss in more detail. We continued our focus in moving quickly and responsibly to bring our stakeholders space based broadband connectivity direct to their unmodified smartphones. From a financial perspective, this meant increased spending on both operating expenses and capital expenditures to support our rapid growth. I’m happy to provide the specifics and context for our overall spend in the second quarter.

We are spending to execute on our objectives to bring space mobile service to market as soon as possible and our financial performance reflects this. Moving to the operating and capital metrics slide, let’s review the key operating metrics for the 2025. On the first chart, for the second quarter, we incurred non GAAP adjusted operating expenses of $51,700,000 versus $44,900,000 in the first quarter. As a reminder, non GAAP adjusted operating expenses exclude certain non cash operating costs, which include depreciation and amortization and stock based compensation. This quarter over quarter increase of $6,800,000 resulted from a $5,500,000 increase in adjusted general and administrative costs and a $2,100,000 increase in adjusted engineering services costs, partially offset by an approximately $800,000 reduction in R and D costs.

This increase in adjusted OpEx in Q2 was above the guidance I provided in our last earnings call, mainly due to large transaction expenses, including completion of the Legato L band spectrum transaction and the related non recourse senior secured delayed draw term loan facility, as well as significant work on our joint venture with Vodafone that we launched at the end of the quarter as Scott discussed. If you further adjust for these transaction expenses, our adjusted operating expense, we’re closer to $46,500,000 largely consistent with the guidance I provided in May after Q1. Turning towards the second chart in this slide, our capital expenditures for the 2025 were approximately $323,000,000 versus $124,000,000 for the 2025. This figure was made up of approximately $298,000,000 of capitalized direct materials, labor for our Block two Bluebird satellites and payments made in connection with multiple launch contracts with the balance relating to facility and production equipment expenditures. This amount was above the high end of the guidance of $270,000,000 that I provided during our last earnings call, primarily driven by two capital spending decisions.

First, in support of our manufacturing ramp and scaling activities, we procured satellite materials above previous plans and ahead of an increasingly volatile tariff environment. And second, we decided to make a $25,000,000 launch payment at the end of Q2 rather than in early Q3 as contracted in support of our evolving relationship with a strategic launch provider. Based on our adjusted operating expenses for the 2025, we estimate that our adjusted operating expenses for the third quarter will come in at a similar level of approximately $50,000,000 adjusted for any transaction expense as we continue to onboard employees in support of our operating plan and augment our R and D efforts for mid man development to support our L and S band spectrum rights. We do expect our capital expenditures to decrease in Q3 as compared to second quarter to a range between $225,000,000 and $300,000,000 due to the timing of certain launch payments, which vary from quarter to quarter. We continue to estimate that the average capital costs including direct materials and launch costs for our constellation of over 90 Block II Bluebird satellites will fall in the range of $21,000,000 to $23,000,000 per satellite.

This is the same range of per satellite costs that I provided last quarter. Our cost per satellite estimates are subject to fluctuations based on dynamic geopolitical factors which impact our costs. And we reiterate our belief that the operation of a constellation of 25 Bluebird satellites should enable us to potentially generate cash flows from operating activities to further support the buildup of the remaining constellation. The timing of the changes in our adjusted operating expenditures and capital expenditures, as I’ve just described, could be delayed or may not be realized due to a variety of factors. Last quarter, I began to talk about revenue opportunities for the 2025.

As a reminder, our revenue opportunity is intimately linked to the number of deployed satellites. As we’ve previously stated, we believe we can enable continuous space mobile service across key markets such as The United States, Europe, Japan, and other strategic markets with the launch and operation of approximately 45 to 60 Bluebird satellites. We also plan to achieve non continuous space mobile service in selected targeted geographical markets with the launch of a total of 25 Bluebird satellites. And additionally, we will continue to support US government applications currently ongoing and accelerating as we launch additional satellites. We are reiterating our belief that we have a revenue opportunity in the 2025 in the range of $50,000,000 to $75,000,000 The achievement of our revenue plan remains subject to several contingencies, including the successful launch and deployment of Block two Bluebird satellites related to The U.

S. Government applications contractual milestone achievements. Critical gateway equipment sales to our MNO partners in support of their anticipated commercialization efforts of our space mobile service And service revenues in connection with the activation of our commercial service provided by our existing and planned deployed and operational satellites. There can be no assurances that we will achieve any or all of these objectives and our actual revenue results will vary based on a multitude of factors. Finally, on the final chart on the slide, on a pro form a basis, taking into account the cash raised in July via the convertible notes with an effective strike price of approximately $120 per share and funds raised in connection with our fully utilized and now terminated ATM, our cash, cash equivalents and restricted cash as of 06/30/2025 was over $1,500,000,000 Drivers for this cash increase include approximately $397,000,000 net proceeds raised from the 2024 and 2025 at the market or ATM facilities that not only funded operations in the quarter, but allowed us to accelerate our capital investments in Q2.

We also received $25,000,000 in the quarter from the Trinity Capital Equipment Loan, dollars 100,000,000 non dilutive funding source to directly support our manufacturing expansion through financed equipment. In addition to the work we did to raise additional capital via convertible notes, we also took actions during Q2 and in the month following to reduce our outstanding debt related to the January 2025 convertible notes due in 02/1932. Between two equitization transactions, we converted $360,000,000 of the outstanding $460,000,000 of convertible notes into 15,200,000.0 Class A shares, reducing the outstanding debt related to our January convertible offering to just a $100,000,000 of outstanding notes, which are due in 02/1932. And finally, we continue to make progress on non dilutive financing from quasi governmental sources of capital in The United States. Following the completion of initial clearances for funding, we are progressing towards diligence and documentation for over half a billion dollars in potential non dilutive capital from multiple U.

S. And international agencies. We will provide updates as appropriate and we will be working with the partner banks and our advisors to refine our alternatives. AST Space Mobile remains well positioned to fund our near term operational plans. We will continue to leverage our balance sheet to quickly bring our space mobile service to market.

Through the 2025, we remain on target to execute against our operational plans for this year and next. And with that, this completes the presentation component of our business update call and I’ll pass it back to Scott.

Scott Wisniewski, President, AST SpaceMobile: Thank you, Andy. Before we go to the queue of analyst questions, we’d like to address a few of the questions submitted by our investors. Operator, could you please start us off with the first question?

Conference Operator: Rupert from Zurich asks, given the current launch cadence and near term goals, is your current funding runway sufficient to reach initial commercial revenue, or do you foresee additional capital needs?

Andy Johnson, Chief Financial Officer, AST SpaceMobile: I’ll take this. This is Andy Rupert. Thank you for the question. The short answer is, yes. We do feel like our balance sheet combined with the opportunities we currently have for both government and commercial inflows in the near term enable us to achieve a strategy that again set out originally with five satellites for key thresholds, 25 for positive operational cash flow and ultimately 45 to 60 satellites for continuous service and strategic markets around the world.

Given our pro form a balance sheet at the end of Q2 of over $1,500,000,000 we do believe that we are fully funded now to reach the 45 to 60 satellite level. And as part of that, our capital strategy going forward will be one focused not on threshold business delivery needs, but rather more commercial and strategic development, an optimal capital structure with additional financial support as appropriate, of course, focusing on de risking the business, but not as the primary inflows for the business. Those will quickly convert to those government and commercial opportunities which are starting to commence.

Conference Operator: Amit from Washington asked, investors are confused about the recent achievement of a first ever native voice call, VOLTE, and text SMS. How does this differ between the voice video text achievements that you achieved in the past?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Thank you, Amit, for the question. As you know, from last year when we did the first voice, the first video, the first text ever though from space and the first five gs connection directly from our network of satellites directly to unmodified phones. That was done using partner spectrums and our core and our technology. What are you starting to see now, we are focused on delivering nationwide service intermittent by the end of the year with our partners in The U. S, Europe, Japan, soon Canada, we are starting to do the full integration to the core infrastructure.

So what you saw was our ability to actually do native calling directly from the dialer of the phone into space using the operator core and operator infrastructure. So we have demonstrated multiple times our ability to do broadband directly from space to any phone of any manufacturer without doing any changes into the phone, without any modification to the phone. And this was just another milestone on how to do that natively in the phone directly from the dialer of the phone without requiring any app or requiring any over the top application.

Conference Operator: Scott from New York asks, any further barriers to the Legado transaction formally closing?

Andy Johnson, Chief Financial Officer, AST SpaceMobile: Thanks Scott for the question. Andy here. Since our last public update, the court did formally approve the definitive documents that were signed alongside the eighty year long lived L band usage rights, which was a huge milestone in this transaction, and that closed the transaction for us as a starting point. Separately, we did close the long term non recourse SPV level financing. It’s in the form of a delayed draw facility that we can use when we receive formal FCC approval.

And in parallel, we’re working to put in place bridge financing ahead of the FCC approval based on our receipt of a sponsor backstop commitment. So finally, do feel good about the FCC and the L band. It’s already authorized for usage from space for geostationary orbits, and we expect that to be a 2026 event for us. So look for initial filings on this front in the coming months, that’s the next stage in the Legato transaction.

Abel Avalon, Chairman and CEO, AST SpaceMobile: What we are achieving with these bands is we have the L band for US and Canada. As you know, we recently also acquired rights to seek landing rights on a country by country basis for the S band. So that in essence will allow us to have direct access to spectrum globally using either a combination of L, S and the low band spectrum from our telco partners. So with this we have the most effective network possible, the low band, which will be the band that we will use for penetration and performance, the mid band for more capacity and combining that in a global basis, we think that is very strong.

Conference Operator: Kevin from Vancouver asks, what is your current monthly production rate for Block two satellites of Micron phase arrays and control stats? And what will it take to ramp up to six satellites per month? For example, is it a labor issue, supply chain issue or other issue?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Thank you, Kevin, the question. In the next week or so, we will be on nine satellites, in addition obviously of the five that we have already in orbit built. With that, we also have the capability now to basically get to six per month in terms of phase out rate production. And we feel that we will have around 40 phase out rates built by the end of the year, very early in 2026, at the rate of six satellites per month with one launch every forty five to sixty days. So we are at rate of the phased array.

We will think that we will be at rate of the full satellite later in the year, this year, for support our launch campaign of one launch every forty five to sixty days with six satellites per launch

: in

Abel Avalon, Chairman and CEO, AST SpaceMobile: average. So six to eight satellites per launch in average. So that’s what we had achieved at this point. We also have we now have close to 400,000 square feet of manufacturing facility, so space would not be an issue. We also had ramp out significantly with our production capacity.

We have now over 1,200 people working on the program. And we have had also secure the launches we seek launches already secure in the manifest of our partners. Following in 2026, we launch every forty five days with six to eight satellites per launch. So we’re there. We’re getting very, very close to basically hit our target to 45 to 60 satellites.

As Andy answered before, we’re fully funded for that. It’s a lot of hard work, but we think that we are getting closer and closer to our goal.

Scott Wisniewski, President, AST SpaceMobile: And with that, I’d like to thank our shareholders for submitting those questions. Operator, let’s open the call to analyst questions now.

Conference Operator: Thank you. We will now be conducting our analyst question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove yourself from the queue.

Our first question comes from the line of Griffin Boss with B. Riley Securities. Please proceed with your question.

Griffin Boss, Analyst, B. Riley Securities: Hi, good afternoon. Thanks for taking my questions. So just want to start off first generally, can you comment further on the revenue share agreements and the economics there with the M and L partners that you have? Obviously, that historically has been predicated on a fifty-fifty revenue share. But seemingly, I would assume perhaps that changes now depending on how much of their spectrum you access versus what you bring to the table yourself with the new S band agreement as well as the potential Legato acquisition.

So any updated color you could give us there would be helpful.

Scott Wisniewski, President, AST SpaceMobile: Hey Griffin, it’s Scott here. Think as you know, from the very founding of the company can you hear me?

Brian Kraft, Analyst, Deutsche Bank: Yes, Even

Scott Wisniewski, President, AST SpaceMobile: from the very founding of the company, we’ve the fifty-fifty revenue share was sacrosanct, right? We bring the network, the operator partner brings the spectrum and the user, the customer. So that’s a very important principle and our contracts stated that very closely. That’s important as part of all the agreements we have with the over 50 operators today. And how that plays out over time, you know, think we’re most focused on growing the business obviously, but you now that our MSS spectrum strategy is an enhancement to the cellular spectrum is becoming clear, I think over time we can talk more about how that value, we capture it.

It’s very, I mean, spectrum is a rare thing. It’s valuable to have and bringing that to the party is something that’s really important that we want to be able to do. But to date, I would say that fifty-fifty rev share with the spectrum brought by others is how we’ve contracted.

Griffin Boss, Analyst, B. Riley Securities: Okay, fair enough. Thanks Scott for the color there. Along the same lines, just with the addition of the spectrum, is there any way you can further translate the 120 megabits per second peak data rate per cell that you’ve mentioned in the past to some real world examples of perhaps how many concurrent users in a location will be able to access the network to make calls, video calls, etcetera, and how that changes with the addition of the spectrum that you’re acquiring, if at all?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes, Griffin. I mean, the way to think about it, satellite have, depending on the band, between 2,500 to 10,000 cells. 10,000 cells obviously is possible with the new ASIC. And what we do is that 120 megabit per second, it is the peak data rate that you can achieve per each of those cells. Within those 120 megabits, within approximately 12 kilometers radius, basically chair that capacity among the users in that area.

So the users in that area, they can use voice, text, video, video conference, FaceTime, WhatsApp, basically email, basically do whatever they do normally when they’re connected to towers. But in this case, they can do it regardless of where they are, regardless of what the phone that they have in their pocket. Demo number of users per cell, that depends on the density of the cell. We basically manage that capacity dynamically and that change as per we add more satellites. But as we explained earlier, our strategy is to combine the low band spectrum from operators for penetration and access to significant amount of devices in a global basis while enhancing at the same time with our own spectrum on top of that.

So it’s a combination of the two things that deliver the 120 megabit per second capacity, which is a capability that actually we can achieve on the satellites that we have today, but in low band.

Griffin Boss, Analyst, B. Riley Securities: Okay, great. Thanks, Saddell. And if I can just squeeze another one in. Just regarding the launch cadence, it’s great to see the rapid pace of expected launches in the future. But in terms of ISRO, the Chairman there recently stated that the launch with a communication satellite, I assume, would be ASTS would be within a couple of months.

So I’m just curious if there’s anything you guys could say as to what the chances are that we could possibly see a batch launch of Blockbird sorry, Bluebird two satellites ahead of the ISRO launch within the next couple of months?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Is not the plan. I mean, the satellite, it is ready to chip during this month. We are in discussion with them for the exact date of the actual launch. But as you can see in our launch campaign, we have six launches and they’re independent with multiple vendors, with multiple launch partners.

Griffin Boss, Analyst, B. Riley Securities: Okay. Got it. Thanks for taking my questions.

Conference Operator: Thank you. Our next question comes from the line of Chris Scholl with UBS. Please proceed with your question.

Chris Scholl, Analyst, UBS: Great. Thank you. You cited the incremental wins in the government space. Appreciate some of this might be sensitive, but can you just help us better understand the types of use cases you’re targeting and the advantages your tech offers maybe versus others servicing the government sector? And given the announcements we’ve been seeing out of Washington, can you just update us on how you’re thinking about the potential U.

S. Government TAM now relative to several months ago? Thank you.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Well, we’re very bullish about the government use cases. Multiple branches of the US government have tested and used and they are currently using our operational satellites. So we are under contract with eight different programs. And it is sensitive, you said. But I can say the broad of applications from the government are both communications and non communications applications, which both are in use already today in our current satellites.

So we continue to be very, very bullish about the government application and also the amount of budget that had been approving appropriation and the actual usage that they are having today. So we reaffirm our plans and our growth opportunity in the government sector.

Scott Wisniewski, President, AST SpaceMobile: And the way to think about the TAM, I think over the last year, year and a half, we’ve articulated that a little bit. What you’re building for through these early contracts is a program of record. And program of records, if you look in this sector, tend to be north of $100,000,000 or several $100,000,000. So, that’s really what you’re playing for and I think of the use cases that can be done with a large phased array in orbit delivered very cheaply relative to historical standards, there’s multiple program of record opportunities that we feel really good about. And how has that changed really in the last couple of months or since the new administration?

We think that there’s more of those types of opportunities and they’re potentially bigger.

Chris Scholl, Analyst, UBS: Great, thank you. And if I can just follow-up on the spectrum with one more question. Now that you have global coverage, should we view this spectrum as being all that you need, or could we see you purchase other licenses here going forward?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Well, we believe, I mean, listen, these are large blocks of spectrums. They are MSS. And they are sufficient to provide the 120 megabit per second, which is our marked target data rates for offering to consumers on a global basis. So we never discard opportunities, but that is what we plan it and with that we can get to the data rates that we’re intending and we’re promising to our users.

Chris Scholl, Analyst, UBS: Okay. Great. Thank you very much.

Conference Operator: Thank you. Our next question comes from the line of Brian Kraft with Deutsche Bank. Please proceed with your question.

Brian Kraft, Analyst, Deutsche Bank: Hi, good afternoon. I had two if I could. First, is the timing of the FM1 launch on the critical path for other launches? In other words, is there a period of time you need before you would do the next launch because you want to test FM1 extensively before the next group go up? And if there does need to be some time in between FM1 and the next launch, what could that time frame look like?

How much time would you need? And then I had a question about the service launch plans. What would a nationwide intermittent service look like? What type of product would it be? Would you charge for it?

Or would you use it maybe as an early promotion vehicle to build interest in the full service when ultimately launches? Thank you.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. We referred to the first question. The answer is no. The other satellites are basically at the same few weeks after the FM1. So we are treating them separately.

We’re not conditioning any of the launches to any specific launch. And as of regard to our the way that we’re deploying this service, we first we start with initial non continued service nationwide in the countries that we announced the service. So starting with U. S, Europe, Japan and some strategic markets that we’re working on. And then we do that.

Then as we add satellites, we basically what it changes is the persistence. So the persistence of how much is available a day, it will rapidly change as we add more satellites. In case of The US, when we get to around 45, you get very close to a service that you can offer. And then as you get to 60, you are in full continued service. And as you get to 90, you are in full global continued service.

And the plan basically called for a launch of six to eight every forty five to sixty days.

Brian Kraft, Analyst, Deutsche Bank: Thank you. Could you comment at all on how you plan to use that intermittent service as a segue to the full twenty four hour service? Are you thinking about maybe using it as a promotional tool to build that interest? Or is this something that you would charge to and kind of focus on earning revenue for it?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Well, we will coordinate that. We are in coordination. We had a plan with our telco partners. We prefer to comment on that jointly with them. But I will say the government is already using these satellites on an intermittent basis.

Brian Kraft, Analyst, Deutsche Bank: Yes. Okay. Thanks, Ivo.

Conference Operator: Thank you. Our next question comes from the line of Colin Canfield with Cantor Fitzgerald. Please proceed with your question.

: Hey, thank you for the question. Maybe focusing back on spectrum, if you can maybe talk about how we should think about tech teaming partnerships essentially kind of affecting both the kind of support of the types of spectrum that you’d be going after as well as the sort of kind of pricing effects? And specifically on the latter, how we should think about kind of ASP’s ability to get spectrum cheaper because you have the tech partners to use it better? If you can kind of talk through those two dynamics.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. I mean, you obviously 60 megahertz of global spectrum, if it were purely terrestrial, it will be a number that nobody can afford. So, yes, I mean, we have the ability with the flexibility of our technology to basically tune to any spectrum in the low band, the 700 to nine fifty or in the mid band, 1,700 to 2,600 megahertz. And the ability to basically connect that to regular cell phones. That by itself creates a lot of value in converting satellite type of spectrum in basically dual use satellite terrestrial spectrum.

So we see it like that. So enabling spectrum is like beachfront property, but it is only a beachfront property if you had a house to build on it. And we believe that our ability to reuse satellite and terrestrial spectrum, given the size of our arrays and the ability to share spectrum between the two applications, is what create this massive opportunity of converting satellite spectrum into spectrum that become much more valuable when it’s using our network.

: Got it. And then, if we go back to the government question, looks like the program books that dropped today suggest something like a $2,000,000,000 delta of kind of incremental opportunity. So just kind of tying that back to the programs of record opportunities that you talked about, Scott, can you maybe kind of think about what sort of timeline we should consider getting through that competitive process? And then maybe kind of like you discussed agility and price. Are the other kind of variables or factors that are being cited as reasons for ASC being able to win?

Scott Wisniewski, President, AST SpaceMobile: Sure. Well, as you noted, the opportunities are dynamic, right? And they’re dynamic and up into the right at the moment. So, all these new pieces of information seem to be very positive for the applications for what we can uniquely offer, right? And so, as we’re evaluating all these and positioning ourselves around them, I think what I said before still holds true.

You know, specific timing of awards could be even this year. Probably, you know, we won’t speak to scale, you know, relative to the end case, but this year is is a good time frame to start seeing more more more direction on that. But like you said, the the budget keeps growing. I think the demand is there. The desire is there.

And what we’re offering is quite unique across five to 10 different

Abel Avalon, Chairman and CEO, AST SpaceMobile: types of use cases. And we solve a very real and tangible problem that the government needs to solve where size of the satellites matters a lot, power of the satellite matters a lot. And at the cost, at the cadence that we’re building the largest satellites ever launched, basically nobody else is, nowhere even close to it. So those are factors that here play into the usability of our technology for both commercial and government.

: And then maybe one more on just kind of that go to market strategy. I think as we kind of like shape the court of players in the satellite communication space, ASC probably still has opportunities to team with folks that are kind of focused on this. So how do you kind of think about maybe shaping your strategy to kind of the neo primes, folks like Androil that focus on not just the defense hardware side, but also kind of the consumer electronics trends that play into that? Thank you.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes, no, absolutely. I mean, with our technology, first of all, you can get basically, as you don’t have devices and you can get, call it, 120 megabit per second into something of the size of a few square inches. You can place it in drones, you can place it in cards, you can place it obviously in the more difficult application, which is actually cell phones and allow the weaker connectivity with all the information that is behind that. So as we said, the government opportunities are not only on the communications space, which obviously is very sizable, large and growing, but also non communication applications the multiple domains for DEFEN.

: Got it. Thank you for the questions.

Conference Operator: Thank you. Our next question comes from the line of Caleb Henry with Quilty Space. Please proceed with your question.

Caleb Henry, Analyst, Quilty Space: Hi. Thanks, guys. A question about the S band. Is that you’ve obtained it at the ITU level. Is that licensed anywhere nationally?

Or is that a project that’s going to start effectively now going state by state?

Abel Avalon, Chairman and CEO, AST SpaceMobile: It is a project that starts now. Basically, we had a bring to use from around 2016. With that, we basically go administration by administration according to the priorities that we set with our partners telco partners in order to complement the low band, the L band and the S band on a country by country basis.

Caleb Henry, Analyst, Quilty Space: Okay. And then on the launch payment that you mentioned was pulled forward, can you just provide any more color on why that was done? I’m guessing it was to offset delays with New Glenn.

Scott Wisniewski, President, AST SpaceMobile: Hey Caleb, this is Scott. No, was not related to anything like that. This is just I think it speaks to a little bit of flexibility we have, nothing more and the fact that quarter to quarter it’s not always apples to apples, but no it was not related to anything like that.

Caleb Henry, Analyst, Quilty Space: Okay. And then just last one, know this may be a bit forward looking, but satellites are called Block two and AST has talked about them up to 45 to 60 satellites. Is the plan to continue Block two all through the 90 ish satellites? Or is there an idea of transitioning to a Block three before you get to that completion of the constellation?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Well, provided the right market conditions, our plan is to actually produce 72 satellites per year and then split them between low band and mid band with our own spectrum.

Caleb Henry, Analyst, Quilty Space: Okay, so it would be two different types of satellites then?

Scott Wisniewski, President, AST SpaceMobile: Yes, for commercial.

Caleb Henry, Analyst, Quilty Space: So does that mean we’re looking at kind of two constellations of similar size, like a 72 each or 90 each for somewhere between 144 to 180.

Scott Wisniewski, President, AST SpaceMobile: Caleb, I’d say, you’re thinking a little bit like how people put out business plans on LEO rather than how people actually build it, right? And I think the smart way where some parties have been successful is, this is really like a mesh we’re building, right? Once we are in with our initial constellation that we’ve talked about, the 45 to 60 satellites that we’re so focused on, we have great flexibility with fantastic marginal economics to really expand not only the size of the constellation and the services that come off it. So, it’s a little too prescriptive, but based on the strength of a demand profile, we have a lot of flexibility. So it’s really think of it as once you have this base constellation, there’s a lot of opportunities to flexibly build that based on demand, particularly when you’re vertically integrated.

Caleb Henry, Analyst, Quilty Space: Right. Totally understand. Thanks guys.

Conference Operator: Thank you. Our next question comes from the line of Tim Horan with Oppenheimer and Company. Please proceed with your question.

Tim Horan, Analyst, Oppenheimer and Company: Thanks guys. On the latest purchase of the S band spectrum, can you give a little more color what it’s being used for now? And I know you used the term priority rights. I guess any more color on your degree of confidence in being able to utilize that spectrum? Thank you.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. Obviously, we’re very confident that we will be using it. That spectrum have been bring to use. And the next plan for us is country by country getting access to it as a combination to our low band, L band and then on a country by country, turnaround also on the S capacity.

Tim Horan, Analyst, Oppenheimer and Company: Sorry, so is The it being used right now for

Abel Avalon, Chairman and CEO, AST SpaceMobile: satellites are they both have the capability to have 3GPP spectrum, L band and S. So those the satellites just support dynamically being able to tune to any of those spectrum bands.

Tim Horan, Analyst, Oppenheimer and Company: Right. But is that spectrum being used now? I guess what’s the history of it? How did it come to be in the MSS and being able to use on a country by country basis? And is it also being used terrestrially in any locations at this point?

Scott Wisniewski, President, AST SpaceMobile: Yeah, I mean, that’s one of the great opportunities of S band. I think, there’s some history of usage in The United States and Europe, but in other markets around the world, it has limited use and it’s reserved for space usage. And we have a network that can really offer a lot of value to regulators and operators country by country, getting citizens extra connectivity, getting operators extra flexibility, more services, more capacity in places where they don’t have towers. We really like the opportunity set because outside of a few markets around the world, certainly big markets, but as you go farther out, there’s a lot of markets where it’s not being used at all.

Tim Horan, Analyst, Oppenheimer and Company: And just one clarification on the revenue share. Obviously, T Mobile is bundling in a bunch of services for free. Verizon has said they’re not going to charge for texting. I mean, it seems like the revenue share is a little bit complicated. What else do you do if it’s being bundled in for free?

Abel Avalon, Chairman and CEO, AST SpaceMobile: We see anything that is just text as a commodity and we don’t reference. Our service is a full broadband. Basically, you can do anything that you can do in your phone. And that’s the model that we have and that we have over 50 telcos around the globe that are subscribing to it.

Tim Horan, Analyst, Oppenheimer and Company: Thank you.

Conference Operator: Thank you. Our next question comes from the line of Scott Searle with ROTH Capital. Please proceed with your question.

Scott Wisniewski, President, AST SpaceMobile0: Hey, good afternoon. Thanks for taking my questions. Maybe to follow-up on the S band side of the equation. It’s very exciting to see you guys now having a multi band offering to provide the broadband capabilities. But I’m wondering if you could provide a little bit more color in terms of the regulatory approval and timelines.

It sounds like you’re going to start that on a country by country basis now. But just what is the timeline that you would expect to be associated with it? And I guess if there are any geographies in particular that you’re focused on, I would assume it’s some more of the developed markets. And second, in terms of the support for existing 5,000,000,000 plus devices out there today, what sort of support is there today in the installed base for S band and kind of how do you see the silicon support syncing up with that at the device level over the next couple of years? And then I had a follow-up.

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. I mean, and that’s why we deployed our network in tranches. And obviously, we start with the low band existing 3GPP bands that are terrestrial. So they are in every single phone. And that’s 5,000,000,000 plus phones available market.

Both the L and the S at 3GPP are in the plans for future chipsets. And they are in line the becoming availability of those bands, it is in line actually with our deployment plan. We start low band where basically every phone supports the band. And as we deploy and get closer to the S band, to the L and the S band, we keep adding into the capability.

Scott Wisniewski, President, AST SpaceMobile0: Thanks. Very helpful. And to follow-up on the non continuous front, lot of dialogue about that today. When I think of non continuous, think of applications like IoT, but I haven’t heard that coming up in terms of the conversation today. So I’m wondering where IoT fits into the carrier partner timeline and landscape.

Is that part of their near term deployment plans and focus? Or is that something that you expect to come later post full commercial launches of more traditional broadband services? Thanks.

Abel Avalon, Chairman and CEO, AST SpaceMobile: I mean, the gap between continuous and non continuous is relatively short. And we will be opening up for usage of consumers in coordination with our telco partners. But as I said before, the early applications are actually governmental applications. IoT is something that we can serve. It’s a relatively small market compared with the broadband cellular market directly to regular handsets and the government opportunity, but it’s something that we would plan to enable in addition to the consumer broadband capabilities that we’re enabling to the telco partners.

Scott Wisniewski, President, AST SpaceMobile0: Great. Thanks so much.

Conference Operator: Thank you. Our next question comes from the line of Greg Pendy with Clear Street. Please proceed with your question.

Scott Wisniewski, President, AST SpaceMobile0: Hi, thanks for taking my question. Just one quick one. On the transaction of Legato, did I hear you guys correctly that when we think about pro form a liquidity right now that the cost of that transaction will be primarily asset backed or financing when the outflows? And can you just remind us, is it roughly $500,000,000

Andy Johnson, Chief Financial Officer, AST SpaceMobile: Yes, absolutely. You have that right. The primary outflow is just north of $500,000,000 and we have SPV financing that’s non recourse, meaning the only rights are held in the special purpose entity and relate to the spectrum usage rights. As noted, when we completed that transaction and the mediation settlement was approved, that starts in October, at the October year, with the bulk of it paid in October, dollars $420,000,000 and another $100,000,000 in March 2026. So we’re working on that bridge financing right now, that gets us from that point in October until we have FCC approval, but it’s all, this is all financed separate and apart from ordinary course operations.

We will have usage fees that will incur when we start utilizing the spectrum and so forth. And those will start up a little bit later this year. That will become an ongoing part of our operating model. We’re not there yet, but the bulk of that is that what’s called a deferred usage obligation in the transaction docs. And that’s been financed separate and apart from our core operating company.

Scott Wisniewski, President, AST SpaceMobile0: Okay, great. That’s very helpful. Thanks a lot.

Conference Operator: Thank you. Our next question comes from the line of Chris Quilty with Quilty Space. Please proceed with your question.

Scott Wisniewski, President, AST SpaceMobile1: Thanks guys. I got dropped, so forgive me if this was asked. But on the government capability, are the government requirements for inclination complementary to what you’re doing commercially or is there a need to inject satellites in different orbits specifically for the government?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Hey, Chris. We do not have the ability to comment on that because that will imply where the usage is. But I will say a big interest is actually to have a dual usage of our satellites.

Scott Wisniewski, President, AST SpaceMobile1: Understand. And the current contracts with the U. S. Government, is there anything that would preclude you from negotiating with other Five Eyes countries perhaps for the same capability?

Abel Avalon, Chairman and CEO, AST SpaceMobile: No. There is not any exclusion. But at the moment, our focus is with the U. S. Government.

Scott Wisniewski, President, AST SpaceMobile1: Okay. And I think you said something earlier that in your statement that led me to believe that perhaps to the degree that government business grows and supports it, there might be a Block X that you might develop with specific capabilities for government customers. And as part of that question, when the original Block two were designed, were some of the government capabilities originally designed in? Were there things that you added after the fact? And definitely things you would like to add to the satellite capability?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. I mean, actually, the capability for the governments are already on the current satellites in operation. They’re actually using the satellites today.

Scott Wisniewski, President, AST SpaceMobile1: But were they major modifications from the original design? Because I think at the point you were doing the original design, I don’t know that or maybe the government was a perceived customer at that point in time?

Abel Avalon, Chairman and CEO, AST SpaceMobile: Yes. I mean, the Block one, it did require additional design features, but they were already incorporated a year and a half ago.

Scott Wisniewski, President, AST SpaceMobile: Chris, the short answer is of yes to all your questions, right? And it’s the beauty of the Constellation because you can once you have the Constellation, the ability to evolve the technology, provide extra tweaks to it. It’s not the classic add a transponder, add a payload, it’s more tweaking the outsized capability of the large phased array and the ability to evolve that over time is one that as long as we have a constellation, we’ll possess that ability to do it in a really attractive way from a financial perspective.

Scott Wisniewski, President, AST SpaceMobile1: Very good. Looking forward to it. Thanks guys.

Conference Operator: Thank you. And we have reached the end of the question and answer session. And therefore, I will turn the call back over to Scott Wisniewski for closing remarks.

Scott Wisniewski, President, AST SpaceMobile: Thank you, operator. We want to thank all our shareholders and the research analysts for joining the call. Can’t wait to give you more updates in the near term and please stay tuned. Thank you.

Conference Operator: Thank you. This concludes today’s teleconference and you may disconnect your lines at this time. We thank you for your participation.

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