Anpanman - Key Takeaways from Q3 Update - $1 BILLION CONTRACTED REVENUE COMMITMENTS

[00:00:06] Speaker A: This is the AST SpaceMobile Podcast.
[00:00:09] Speaker B: It will just basically come to your phone and be seamless regardless of where you are. We don't want the user even to know that it's connected by satellite. Listen, the opportunity that we have is very, very, very large.
[00:00:28] Speaker C: Good morning, everyone. Oh, I feel much better. I guess for those people who missed it, I did a space last night, but then I actually deleted it because I was so tired that, that I, I don't know, I felt like I didn't do the space justice. So I've decided to do it again before the market opened today. But Yeah, so just wanted to briefly review Q3, just the key highlights that stood out to me. I did tweet a post of just all the different nuggets of information that came out from the Q3 update. But, you know, the key things that really jumped out for me were first, the company disclosed today, yesterday that they have over $1 billion dollars in aggregate contracted revenue commitments, and that's solely from commercial partners. So that does not include any government, FirstNet, or military, Department of War, SDA, DIU. That's just solely on the commercial side. And I know there were some research analysts that had asked if they could disclose any details around who makes up that $1 billion, and I would assume that a big chunk of that is the most recent Saudi Telecom definitive commercial agreement where Saudi Telecom put forward $175 million of prepaid revenue. So that's clearly $175 million of $1 billion. And then they also made minimum revenue commitment, which was not disclosed, but that's over 10 years. And so You know, you could assume any different numbers for that, but it's not just Saudi Telecom. So I think you could also include into that bucket Google, which has a commercial agreement with the company that they signed, I think it was back in 2024, and that was a 3-year agreement. So I'm assuming those revenues are included as well. And then It could be AT&T, Verizon, Vodafone, some combination of those, as well as Rakuten. And then finally, I think there is a possibility that perhaps Bell Canada, there is an agreement there. I don't think it's a definitive commercial agreement. Maybe there's a few conditions precedent that have to be met in order for that thing to go live. But for all intents and purposes, in the presentation they showed a coverage map In the last quarter, it was just AT&T, Vodafone, and Verizon, and I believe Rakuten. And then this quarter, they updated that map that shows logos of Bell Canada and STC. So I assume Bell Canada has something. Maybe it's just not at a point yet where it can be announced, but given that they are a critical initial commercial launch partner. And, you know, they re— last night the company reiterated that Canada is one of the initial countries that will get service. And then couple that with the fact that Legato, the spectrum that we purchased also covers Canada. That's going to be an important market. And so yeah, $1 billion, that's huge. I think for Anyone who, you know, if you were a, if you're a bear or someone who doesn't believe in, in AST SpaceMobile, the fact that there is $1 billion in contracted revenue commitments, I mean, that's, that's huge, right? And so, you know, we've talked about this idea of inevitability, inevitability, inevitability. I can't say that. But yeah, there's that, that's revenue that's going to be coming through the door. Obviously it's going to be, Based off of some types of milestones or obviously service, but that's huge. And so I think that's probably the biggest disclosure yesterday that I took. I mean, obviously over this past quarter, there's been a lot of announcements. And so whether it's Verizon definitive agreement, STC, the closing of Legato, The acquisition of S-band spectrum rights. I mean, there's a whole host of things that happened this quarter, but the company putting forward that $1 billion number is massive, right? And so I think that just gives the market a sense of scale of what the company is doing. And that's business that is going to be coming in the future. And yeah, it's something I think that's good for the equity markets and also critically for debt markets. And so if you do have contracted revenue from commercial partners of $1 billion, then that's something that credit investors can underwrite against. And so you could raise debt against that just like you would if you got, you know, long-term contracts from the government. you know, lenders would be willing to give you money against that. And so that just opens up another path of fundraising. And so yeah, that's a huge piece of information that came out yesterday. Another thing is that we've got our 9th contract award from the US government, and it was pointed out that that award was given even during the government shutdown. However, there's still details to be ironed out, which those, from what management was saying, those details will be ironed out once the government reopens, which I think, as we've all seen in the press, is going to happen most likely by this coming Friday. So that's positive, just showing additional traction and wins that the government, especially on the defense side, I think is important to the story. And it's something that when the company was asked in Q&A, and I think it's an important point, at least the initial first constellation is going to be dual use, and the company would like to keep going down that path where every satellite that's put into the constellation will have dual use ability. So there won't be a dedicated military constellation. It will be one that serves a commercial purpose, but then also has military uses as well, whether that's communications or non-communications applications. But that 9th contract out of what was already 8 contracts is important, as we've discussed in the past, that these contracts initially start out with small payments. And then once you've proved out the technology and the military is comfortable, with the use of that technology, that's when the numbers balloon into the hundreds of millions of dollars in size over multi-years. So that's good. Another interesting data point yesterday was that Saudi Telecom, the $175 million prepayment is going to be made by year-end this year. And so that will be coming through the door. That's important for funding. It's not going to be booked as revenue immediately. It's even though the cash is coming through the door, that will be recognized over time once the service is launched. And maybe there's certain milestones that were hit, but yeah, that's $175 million, which is good. And it just also shows the idea that as we get closer to commercial launch and as both services launch, the company has talked about this idea of extracting higher economic rents. from M&Os as you add on additional commercial agreements, they will require prepayments and depending on what bells and whistles are within that commercial agreement, the amount of prepayments likely goes up over time. And so I think that's, you know, last night the company emphasized that even though they did raise quite a bit of money from the capital markets recently that their entire focus right now is going to additional M&Os and signing commercial agreements that come with prepayments. And so going forward, prepayments are going to be, which are, you know, non-dilutive in nature, they are going to be a critical piece of the funding You know, plans for the company. Another big thing that came out yesterday was that it seems to me that the control set or the control bus, you know, the manufacturing of that is a critical path item right now. And so what we saw from the disclosures last night is that the company has built enough microns, the, the, the, the, you know, building blocks, which has the solar panel on one side and the antenna array elements on the other. And the processors in between, sandwiched in between, but it has enough microns. I believe it was for, let me just look at my notes here. I think they've built enough for like 19 satellites already. And I think that's right. But they're looking to target finishing 40, for up to 40 satellites in early 2026. And so when you look at the deployment plan that the company has laid out, they're actually on target for the amount of microns that they've completed. And that's for up to, at this point, it's for up to 6 planned launches. Now, we don't know what the combination of launches are. Obviously, there's going to be 2 initial launches that are for 1 satellite each, and then there's going to be, I think, 2 for 3 satellites. And then at some point in early next year, then that's when Blue Origin New Glenn kind of kicks in, and that's going to be probably somewhere between 6 to 8 satellites per launch. But yeah, from the deployment plan, you can see relative to August to where it was updated in November, the amount of Microns that they've completed is actually on schedule. What has fallen behind initially, or for now, is the control set or the bus. And so, you know, why is that? You know, this is a new form factor. The entire satellite's new form factor. Building the microns is actually, I mean, it's not straightforward, but they're getting much better at it. And we've talked about this whole idea of production hell. And so the company is in the middle of that and it's just part of, it's part of the dues that you have to pay. to be vertically integrated. And so, you know, whether that's Tesla or other companies that have taken production in-house, I think we all know how critical it is to be vertically integrated, especially for these programs where you're developing satellites for— let me just mute my Bloomberg here. But yeah, it's important to be vertically integrated. You know, we've seen some of these other satellite constellation companies like ViaSat, where their first satellite was produced and then the next one was 5 years late. And so especially in an evolving landscape, and this has plagued other constellation companies, whether it's Globalstar, Iridium, or others who rely on primes. Here, AST is developing everything in-house. And so as Scott mentioned last night, As they continue to produce satellites, they will refine them and they'll add features as needed depending on customer requirements. And so that's the beauty of being vertically integrated because you have control over everything. On the flip side, there is a significant upfront cost in terms of dollars, but also learnings that have to happen. And so we're just seeing that today, yesterday, and obviously for the last few quarters where this is a completely new spacecraft that they've built. And so FM1 was completed and shipped basically, I think it's 2 months late relative to the August timeline, or maybe it was 3 months late. But then it looks like FM2, or what we call BB7, is going to be shipped. The company reiterated this in You know, this month. And so whether that's in a week or two or by the end of November, that's going to happen. And so if you look at the timeline, everything has slipped in terms of the expected satellites, you know, when they're ready to ship. Everything has slipped by at least for BV7 for 2 months, and then for BV8 through— let's see, the next 6 satellites.
[00:13:45] Speaker B: Yeah.
[00:13:46] Speaker C: It looks like that timeline has slipped by just one month. So the company is looking to catch up. And so what was originally for Launch 3 and Launch 4 satellites really ready to ship in November for both of those, now that's December. And then, and so on and so forth. And so that keeps going until Launch 7. So everything's been basically delayed by one month. And then by Launch 7, the company expects to have caught up to its original August timeline. And then everything from that point on, you know, from February on is going to be in line with what they expected. So the company reiterated 5 orbital launches by the end of Q1. And so, you know, as of now, they feel confident that they can catch up. And it's interesting because we saw in a disclosure today, or sorry, yesterday, the presentation, they did show a little more detail. Of course, it was still blurry. of the BV7 metal bus that encapsulates the satellite, or we call it a cat food can or whatever you want to call it. But they showed that and then they showed for the first time the composite buses. And so I think there were pictures of 3, or maybe it was the same one, but what's interesting about that is the composite bus I think is made of carbon fiber. And from what we've been able to learn, they've been able to bring that production capacity in-house. And so, you know, usually, and I'm not an engineer or aerospace expert, but, you know, you have some type of skeletal frame and then you start wrapping carbon fiber around it and you wrap many, many layers and I don't know, use glue and heat and some other things.
[00:15:36] Speaker B: Yeah.
[00:15:37] Speaker C: they actually have all that capacity in-house. And so they don't go to Boeing or Spirit or one of these other companies. They actually do all that stuff in-house. And so the initial learning curve and process around that, it takes time, but once you get it going and you get better and better at it, then production can speed up. And so that's kind of what we're seeing. And it sounds like they've got a good handle on it. The interesting Thing that Abel said yesterday is that they are on target still to get to 6 satellites per month production by the end of this year. And so that actually fits quite well with the deployment timeline that they updated. And so yeah, it looks like they're getting through some of these issues. It's taking a little longer, but as I've talked about in the past, it's, you know, It's inevitable. And I think when your competitor is Starlink, who has a dearth of MNO relationships, and obviously they're going to have to get through some production ramp in order to get the V3 satellites out there, which, you know, I've talked about this in the past, but it sounds like they're putting a ton of bells and whistles on V3 satellite. I mean, so it's going to be, It's going to provide fixed wireless service. They're going to slap on a direct-to-device array on there with its own processing, and I guess it's going to leverage the same solar panel. And then Elon Musk said last week that they're going to put a data center capability on it. And so when you start putting all those things on there, you know, we talk about first principles engineering, you have to make compromises and sacrifices, right? If the satellite's doing 3 different things, Is it a jack of all trades but master of none type of situation? You know, it remains to be seen. And so as you add more things on there, it becomes more complicated, you know, managing. And, you know, there's this whole idea around data security and, you know, is all this stuff going to be intermixed? And yeah, there's just a lot of things to consider. And so I think it's important You know, there's like a few street analysts out there that talked about how Starlink has ambitions to increase their throughput capacity and the next directed device satellite's going to be great. It's going to be, you know, all these things. But just remember, like they're spinning up an ASIC. It's going to take a year to 2 years to do that. And they're going to have to build this entirely new satellite that has to go on an entirely new Launch vehicle, Starship. And so as we all know, space is hard and it's going to take time. It's going to take longer than you think. And that's just part of, that's just the nature of the beast, right? And so being an ASD SpaceMobile shareholder, or if you're a Rocket Lab shareholder, you know, Neutron I think is now going to be launched in the first quarter or first half of next year. This stuff happens and that's just part of being in space. Like, This stuff takes time. But yeah, so while, and the market has already priced in the BB7 being delayed, I mean, it hasn't shipped yet. So, but at least I think importantly, there have been a number of folks who've asked about launch timeline and when you did get it, I mean, yesterday they talked about BB6 going up in the first half of December. Out of India. And then they talked about BV7 being shipped to the Cape in the coming weeks, and then it's going to launch shortly thereafter. And then beyond that, if you look at this deployment schedule timeline, it looks like, let's see, it looks like Launch 3 and Launch 4, the satellites related to those, which I assume are the next 6, are going to be ready to ship in December. And so you're looking at a January that's going to have 2 launches and then you're going to have 1 launch in February and then 2 launches in March, possibly. So pretty chock-full schedule. Anyway, so yeah, I did mention this before. They still are targeting a production of 6 satellites per month by the end of this year, which is great. And then, yeah, one thing that was disclosed today, and the company has hinted about it for quite some time, and someone dug up the patent, which was filed in 2022. But today was the first time that Avel talked about their AI engine and how it will manage satellite capacity. And this is important because, you know, obviously when a satellite's going overhead and it's projecting several thousand beams, it should be able to notice that there are certain areas, for example, if there's a disaster in a specific city and all terrestrial networks are down, that it should beam more capacity to a certain cell and maybe shut off capacity or reduce it in other cells. And so this AI engine that they've developed, which I think runs on top of their ASIC, that was an interesting new disclosure today. And so There is this ability to dynamically shift capacity in a smart way and then also utilize spectrum more efficiently. And so I'm not exactly, I'm not an engineer, but I think one of the things that the company talked about yesterday was the ability, and in my discussions with management, there is this ability to basically take pieces of spectrum at different frequencies. And if you think of like an analogy of a zipper, the satellite is the middle part of the zipper that's able to join all these pieces of spectrum and provide contiguous coverage. And so I think this AI engine is going to be important for that. And when you think about AT&T and Verizon, and the spectrum that they're contributing. Some, there's like the 850 spectrum, there's some areas where it's wider and then in other areas it's going to be more narrow. And so the satellite's going to be smart enough to actually piece that together to provide 100% nationwide coverage. The other thing that's part of that is the fact that the company disclosed that in the US they're going to have 80 megahertz of deployable spectrum, which is nuts, right? And there's actually Some things to kind of read into that. And so with Legato, they get, you know, call it 40 to 45 megahertz of spectrum. And then you throw on FirstNet, which is, you know, I think it's maybe, and I actually need to dig into this, but I think it's maybe 5 by 5 or so. But then if you add on the 850 megahertz that the 2 parties are contributing, the 80 megahertz is actually more than all those things added up. And so I think The company just disclosed or hinted that AT&T and Verizon are looking to contribute more spectrum than what they had originally planned in the leasing agreements. And so that's something to look out for. It either means that, or the alternative is, and I just thought of this, the alternative is the company is close to either acquiring or leasing additional L or S-band spectrum in the US. And so I guess interestingly that the whole Globalstar story could fit that a little bit because they've got 15% capacity to lease out to somebody. And so maybe that's it. I don't know. But 80 megahertz, that's more than what we know on paper AST has through its Legato ownership and then what it's been disclosed with AT&T and Verizon. So That additional spectrum is coming from somewhere and maybe that's like a nugget that they've given us and we have to go figure it out, which we will. But yeah, I guess my point is like 80 MHz is a lot. I mean, it's huge. That's, if it's paired, it's 40 by 40 MHz. You can run a ton of data services on that and serve users, depending on how much you densify the constellation, but that's going to be a very robust service. In dead spots, that would be terrestrial spectrum, but then overlapping the terrestrial spectrum, just the entire thing, you've got Ligado spectrum, satellite spectrum. And so that's going to be a very robust service, whether that's for users, but then we've talked about this idea of IoT devices, and that includes robots, autonomous vehicles, drones, all those things. And so that's going to be very powerful. Going back to the AI engine, the other thing that we've speculated is that maybe Cohere Technologies is going to be a part of that. And if you go look at the company's website and do some decent amount of research, this is exactly the type of stuff they're doing, which is driving for greater spectral efficiency through different algorithms and utilizing different wavelengths. And I'm butchering exactly what they do, but Cohere is a company that is very well connected to AST. Cohere is doing tests with Bell Canada. I believe they're doing it with Vodafone. It just happens that we're both partners with them. They're also— Johan Weiberg, who was the former CTO of Vodafone, he sits on the board of Bell Canada and Cohere and AST SpaceMobile. And so there's never been a public acknowledgement that the companies are working together, but the connections are very clear. And given this disclosure around this AI engine, I think that's probably the biggest tell that the companies are working together. So yeah, I think that was an interesting takeaway as well. Funny enough yesterday, so I haven't talked about the Satco JV, which I have another podcasts covering that, but SACO-JB company did talk about it briefly. It's clear that they're going after the 2 GHz MSS spectrum that's coming up for reallocation in May of 2027. And as we've discussed, like that SACO-JB is going to be very well positioned. They've got 21 of 27 EU member states, you know, MNOs that are operating in those countries signed up. And yeah, they're going to be very well positioned in order to get that 2 GHz and also get some level of funding from government, obviously from the imminent partners that are going to invest in that JV or the constellation or provide revenue prepayments. But Scott was asked in particular, and I don't know if the cell side gain loss, it sounds like they're definitely getting smarter at this stuff. But they were talking about this rumor that perhaps the EU IRIS-2 award was given to AST SpaceMobile. And for those that don't know, it's a €10.5 billion contract that was awarded. And yeah, that's past tense. It was awarded. I think it was like back in October of 2024. This was a 12-year concession contract that was given to SpaceRise, this consortium that's that includes SES, Eutelsat, and Hispasat to develop and deploy this multi-orbit satellite system. And so, you know, this idea of us potentially getting part of it, you know, some people have said, well, wasn't that already awarded? Like, how is that possible? Well, IRIS-2 has a few different components to it. And I think the key component is that it's doing fixed wireless service. So if you can imagine, The core business of what Starlink does today or what Kuiper's doing, it's high-speed broadband to fixed terminals. And so I think that's the main thrust of the program. However, that program is supposed to also have a direct-to-device capability. It's, you know, there's no standalone award for it, but it's treated as something separate. And so where I think There is this possibility that AST SpaceMobile does have a role to play. And I think, you know, Scott was kind of cagey in his response, and his response was almost like an acknowledgment that they are part of it or they're going to win it. And, you know, I dug in a little more as to why that would be the case. The EU material that discusses direct-to-device it actually talks about how that's going to be led by MNO partnerships. And so rather than, you know, a, a something that's, that's, I guess, directly awarded, they are going to let that evolve and MNOs are going to kind of lead the evolution of that. And so whether that those IRIS partners are able to get MNOs on board and then, you know, develop their own direct-to-device service, If I was a betting man, I would bet every dollar that I have against that happening, just given that you have like 3 partners trying to figure this stuff out and then they've got countries to answer to and we all know about European bureaucracies, like that's going to be tough. Whereas Vodafone, NAC, SpaceMobile, in the Enabls conversation yesterday, people asked about mid-band Bluebirds when they were going to be deployed. And he said they're targeting to start having, whether it's completing the first one or launching the first one by the end of 2026. And so, and I think that's important because they'll want to have, they're going to need to launch mid-band Bluebirds anyhow because they want to leverage the Ligado spectrum. But by having those satellites in space and already testing and and operational, that's going to look super attractive to the EU when that 2 gigahertz of spectrum comes up for renewal. And as I mentioned before, EchoStar, I think they had that concession for, what was it, 18 years? And they basically did nothing with it. I mean, it was like narrowband IoT. There was a few thousand devices on it, but it was basically wasted. And then I think Viasat has the other the other allocation of 2 gigahertz, and that was used for airline wireless internet service. However, it looks like Starlink has pretty much taken most of the European carriers' interconnectivity business, and that's for fixed wireless. And so I'm not even sure what Viasat's going to do. And by the way, like Viasat in their earnings call, they talked about And yeah, they talked about how they have valuable spectrum rights and they're hoping someone else will come in and lease it from them or monetize it. And so yeah, of course you want that to happen before it comes up for renewal because when it comes up for renewal, there's a pretty good chance they're not going to get it. And Globalstar on their earnings call alluded to EchoStar basically not doing anything with that 2 GHz spectrum. So Globalstar is going to try to get that. That allocation, which by the way, like AST SpaceMobile going to EU regulators with Vodafone as a partner and all these MNOs, you know, you can imagine Telefónica, Orange, Altice, whoever, representing 21 of 27 EU member states, they're going to go to the regulators and say, hey, we'd like an allocation. Can you give us 10 by 10, 15 by 15 if you're generous? I think they're going to win it, right? And so, but going back to this whole Iris thing, there are ways where AST and Vodafone can insert themselves into that process, specifically because it looks like the direct-to-device piece is going to be MNO partnership-led. And if that constellation doesn't have any MNO partners, then that's pretty much DOA, right? I think those concessions have to be reviewed over time and they can be changed. And so if regulators see that the company AST with Vodafone has a ton of traction, then maybe they split up that contract. And so I'm guessing that's probably what the company, the approach is. But yeah, we're really well positioned for it. Let's see, I'm just going through. The list here. What have I not covered? Yeah, so as you know, initial intermittent service is going to be rolled out in the US, Canada, Japan, Saudi Arabia, and the UK. When Canada is mentioned, that means that Bell Canada, there has to be a definitive agreement for, you know, put in place before that happens. So let's see here. As I mentioned before, Bluebird 6 is going to launch in the first half of December. Bluebird 7 is going to launch sometime mid to late December. And what was great to hear is that the company is planning to have retail investors invited for those events, which I think are great. I'm planning to attend. And so hopefully some of you out there will also attend. They reiterated targeting 45 to 60 satellites deployed by the end of 2026. Another question was asked about the recent funding. What does that mean for the deployed constellation? The company did say that with the recent funding, they can now deploy over 100 satellites. So that's positive. I mean, we've always talked about the company wanting to have The destiny, they're, they're, you know, they want to have their destiny under control, which they do. Let's see. Also, what was disclosed is that Bluebird 8 through 19 are in construction. And so what that means is, to me, is that, you know, the company already disclosed that all the microns are completed. Now it's just a matter of finishing those composite buses. control sets and then mating them and then obviously testing them. And so that's a good data point. And I think it's important to highlight that there was a question, I think it was by William Blair, where they discussed this whole idea of 25 satellites being deployed. And they asked, is that number related to, or is it what you will need for beta service? initial beta service. And Scott did acknowledge that 25 is the right number. And so, you know, we've talked about this idea of those 25 satellites generating enough revenue that will cover a decent amount of operating expense spend. And so it sounds like that's, you know, beta service, having enough satellites for beta service, that's going to be something that depending on how you do the math is going to be Available sometime in, I think, Q2. So that's something to look out for. Let's see here. So the ASIC is going to be integrated into new satellites starting in the first quarter of 2026, which is good news. The other thing is, you know, the company reported $15 million of revenue. And so if you just back out what they reiterated, which is $50 to $75 million in the second half of this year, that means that Q4 will be anywhere between $35 to $60 million of revenue, and that's all related to gateway sales, which they said is going to average about $10 million a quarter. And so the $25 to $50 million of revenue in Q4, that's going to be government contract related. And so I think in the 4th quarter, they're going to, depending on how much they have to disclose, but they're probably going to talk about We'll have to talk about some of that government work on the defense side. And so that will be interesting. A few other data points, you know, 3,800 patents and patent pending claims. That's up from 3,700 in the second quarter. They also did boost square footage of manufacturing. And so over the summer they talked about 400,000 square feet of manufacturing, but now they're at 500,000. spray feeder manufacturing. And so that's a big jump up. And no, I'm not seeing, oh, I guess I didn't include it in this post, but yeah, that manufacturing space, you know, as the company is looking to ramp up production, they have talked about this idea of going from 6 satellites to actually 10 to 12. And so my guess is what that means is that they are At some point over 2026, they'll probably look to increase that number from 6 satellites to maybe 8, to then maybe 10, to then maybe 12. And the reason why they would do that is one, you might want to accelerate the Block 2 deployment, but then also my guess is they're going to start production on Block 3, which is the mid-band Bluebirds, which can serve L and S-band spectrum. The point that I left out here is that they also disclosed that they have 1,800 workers globally. When I was posting this last night, I had some errors and I had to edit it, but I guess some things got dropped. So I'm wondering what I may have dropped out of here. But yeah, so they're at 1,800 employees, which is nuts because I guess a few years ago it was just a few hundred, but they are ramping up. They're bringing more people through the door. And as some Space Mob members have tweeted, there's some really impressive people they've been able to bring into the fold, which is great. Let's see here. And then my last, I guess my last nugget here for the 3rd quarter is, you know, Bill was asked about launch capacity and if, you know, how they're seeing that. And obviously the company has put forward payments on launch providers for this coming year. And they feel good with the stable that they have. Obviously they're using ISRO, LVM3, their SpaceX Falcon 9, and then Blue Origin New Glenn, which by the way is going to have its second flight on Wednesday. So that'll be exciting. But this was the first time. So when I've talked with the company, they've always looked at launch as being something that's constrained near term. So call it 2025, 2026, but then 2027, They've talked about this idea of there being a lot more options on the table. And what that means I think is obviously New Glenn by that time hopefully will have more steady cadence and will be more reliable at that point, which remains to be seen. But then by that time you'll have Rocket Lab, Neutron will hopefully, knock on wood, be you know, be a reliable and stable platform or close to getting there. And then Abel called out MHI yesterday, which is Mitsubishi Heavy Industries, which back in October they did launch their H3 rocket. And let me just look at my post here. So they launched their H3, which in their heaviest configuration, which has 4 solid rocket boosters, it can carry 16,000 kilograms to LEO. Which, you know, I looked up different sources and it was estimated at $50 million per launch, which is pretty affordable actually when you compare it to SpaceX Falcon 9. But yeah, they had a successful launch back in October. And when you compare the economics, I think Falcon 9, and my post is a bit wrong here, but Falcon 9 is for $67 million in reuse mode. can only take 16,000 to 17,000 kilograms WO. And so that H3, it seems like it's somewhat comparable. My price estimate is probably off, but anyhow, it is something that for the first time, the first time I heard it, the company disclosed that. And it seems to make a ton of sense because Rakuten is an important partner and Rakuten is Japanese and You know, the Japanese are looking to grow their space program. And so having 2 or 3 Bluebirds go up on a Mitsubishi H3 would be pretty damn cool. That rocket, by the way, like I did some research on it and there, when they first released it, there's configuration for 2 SRBs and then 4 SRBs, which is what happened in October. And then there were plans for 6 SRBs, 6 solid rocket boosters, which then could increase the capacity beyond 16,000 kilograms. But then from what I read, like they scrapped that, but who knows, maybe they'll bring it back. But anyway, I guess my point is that there is going to be more launch capacity by the end of 2026 and then 2027. And so hopefully by then, you know, the company Has 2 lines going of low-band Bluebirds and mid-band Bluebirds, and then they're just chunky up these satellites. You know, we, Abel talked about this idea still of 30 to every 30 to 45 days, but maybe, I don't know, you might get into the situation where it's like Starlink where you're launching these satellites every 2 weeks. And so yeah, that, that will be exciting, but Anyhow, those were some of my initial thoughts. And then this morning, I guess just for people's edification, you did have a number of research upgrades. So Deutsche Bank raised their price target to $81. They were at, just look here, they were at $59. And then Roth Capital moved up to $82.50. They were at $56. And then, you know, I think B. Riley reiterated their $95 price target. Cantor yesterday reiterated their $80 price target. Our Scotiabank, which is, I don't know what these guys are doing. They still have their sector underperform rating. You know, they got turned by bears somehow, but they, this is how silly they are. They went, they raised their price target from $42.90 To then 4,560. So I don't know how you explain that, but anyway, but yeah, I think there's going to be some additional upgrades. We've got Barclays, ClearStreet, and then I think, I haven't confirmed this yet, but I think UBS and Bank of America may have just reiterated what they had before. But yeah, I do think we'll get maybe 2 or 3 more upgrades later today. Let me just see if there are some questions, which I see a few comments. Let me see. Just look here. Scott Powell, can you do the math on how we get to a number of sats we committed to in 2026? How many F9s and BOs? Actually, someone's done that math before and I can pull it back up at some point, which maybe I'll try to find it and retweet it. But I mean, the key thing is, is Blue Origin coming online? And if not, then we'll have to just go buy more Falcon 9 launches. But let's see here. But yeah, I'll try to find that tweet and put it back out. Let's see. Randy Hoffer found it interesting that Avel kept emphasizing that we are an American company. After you asked about EU and IRIS. Yeah, so we are an American company and that is our focus, but then SATCO JV is going to be a European company and where we are a junior partner, we're going to be a minority partner. Maybe we, I'm just making numbers up, but you know, we'll have 50% or 49% economics, but then in terms of Voting rights maybe will be, depending on whether MNOs join that, we will be probably much lower down the totem pole. And the way that that thing is going to be structured is it's going to look European, feel European to regulators. It's going to be European, right? And so they're going to have a kill switch. They're going to have these different abilities to, the data's going to originate there and land there. I mean, any number of things. So it's going to be control center. Oh, the other, I guess, interesting data point yesterday is that the company did— someone asked if indeed SatCo JV, that constellation's going to be entirely separate, like a distinctly separate constellation. And the answer was no. And so I think the way that the company is doing this is that the satellites, when they do go overhead in Europe, The European operators of Satco JV will take over and they'll have a kill switch. They'll, as I mentioned before, the data will originate and land in Europe. And so for all intents and purposes, when the satellites are overhead in Europe, they are going to be European assets run by Europeans. And so yeah, I think there's different technological ways to do that, but From an economic standpoint, it makes sense to just leverage the same assets. You want to amortize those over as many countries as possible. But yeah, I, and I think about emphasizing that we are an American company, that as this person points out, that is important for our government work and potential funding as well from the US. Let's see. So Can you talk about how much lag there is in cash flow once revenue starts rolling in? Is AST getting their money upfront day one services being turned on, or perhaps 60-day lag? I'm not sure. I mean, I think this is going to be something, you know, for the consumer, it's going to be probably a lag, right? Like there's going to be a subscription where the MNOs get paid for service by a 30-day lag, and then they'll disburse some payment to the company. within some timeframe. That's my guess. I don't know what lag that would be, you know, if it's 45 days or whatever. But once, you know, you have this revenue prepayment and then once the service eats through that, then the company starts getting additional cash flow based off of service. And yeah, there'll be some lag from when consumer pays their bill and it goes, which is 30 days behind when they have the service, and then the MNO will then disburse that payment to the company. You know, is that a week? Is it 2 weeks? Who knows? Let's see. Why so vague on launches/carriers? Why so vague? Because that's the nature of the space industry. It's, you know, for the company, they, you don't want to commit to dates until the satellites have You basically want to wait till the last possible minute because you never know what kind of hiccups there are in production. And because once you get a date for launch, it actually costs money to then change it. And so you want to have as much flexibility as you can. And I think with Blue Origin, by the way, I think they do have a lot of flexibility, obviously because Blue Origin as well is like not yet a stable platform. But you want to be vague about who you're doing that with too, because for the company, they want to have competitive tension, right? Like on the, by, by, if they were beholden to just one launch provider, then that launch provider, you know, that's a pretty risky strategy because then if there are any issues with that particular launch provider, then that impacts you. If there's delays or if there's an incident and FAA has an investigation, you kind of have to wait for that. But then by diversifying your launch providers, you reduce that risk, but then also you create a competitive tension where, we've discussed this before, AST SpaceMobile is the biggest commercial satellite customer besides Starlink and Kuiper. And so that's a lot of heft. And that's, when I say commercial, that doesn't include like military, but And so that's a lot of dollars that are going to the launch market. And so what you want to do is you want to have a jump ball situation where you put these things up for RFP and you want ISRO, SpaceX, Blue Origin, Mitsubishi Heavy, Rocket Lab. You want all these companies competing for your contracts because you want the best prices and execution. And obviously there's like a balance to all that. If you go with SpaceX, like it's tried and true and you know it's going to happen on the timeframe it's going to happen and you're going to pay a premium. But then with some of these other providers, you're going to pay potentially a discount to a degree for the uncertainty. But as they become more robust and have regular cadence, then those options become more attractive. But that's why you kind of have it vague and, and you kind of figure it out as you go.
[00:50:30] Speaker A: Let's see.
[00:50:31] Speaker C: Let's see if there's any other questions here. I'm just looking through. Oh, we got some research reports. So I'm going to post some of these reports. Thank you to the people who shared them with me. But yeah, so big takeaway, I think yesterday is a little bit of a waystation update where there's a lot of good news that happened over the quarter and then the company kind of reviewed that. The big drop, you know, mic drop for me was the $1 billion in contracted committed revenue because that's massive. You know, that's something tangible that you can get your arms around and that's that's basically on the way. And so the key is obviously getting these Bluebirds launched. We are a few weeks away from BB-6 going up and then maybe a week to 2 away from BB-7 going up. And I'm hoping to be there in Florida for that in December. And then I think, as I said before, I think we have 2 launches in January, which will be a total of 6 satellites. And so that's going to be very exciting. And so yeah, the company has a lot going on. I think the critical path item, the bottleneck is this control sat, the bus. And so once they kind of figure that out, these things are going to be popping out like hotcakes and there's going to be a lot of launches to attend. And so I think that's kind of the update that I have for now. Yeah, it's an exciting time and we'll see how things go. I think the market in terms of sentiment, you know, you've seen a number of upgrades and now it's, And they were all kind of waiting for the events to happen. And as we've seen in the past, you know, stock typically ramps up into these launches. And what's different this time is, you know, the stock is ramped up into launches and then after the launch happens, it's kind of a seldom news event. But here the market's not going to get a break because you're going to have launch after launch after launch after launch. And so under that environment, Yeah. Who knows how the stock will perform? So it'll be a lot. And I think I forgot to mention this too, I guess in closing, I think the company yesterday talked about the Saudi Telecom deal, how there's more in the pipeline, and that is a good template to look at. And so as we've seen these revenue prepayments going back from AT&T and Vodafone to then Verizon and then Saudi Telecom, those revenue prepayments have continued to ramp up higher. And so from what I understand, I think Scott is a pretty busy guy. He's traveling the world. There's more MNO agreements to come, and it sounds like those are, you know, now's the time where the company's going to be striking these things. And so I think, as we mentioned before, Bell Canada is probably next. The other candidate that I have in my mind is Etisalat, which is based out of Abu Dhabi. There's some interesting connections between the company and Abu Dhabi. And so I think that could be another big one that comes that's going to surprise people. Although I guess it won't surprise people since I mentioned it here, but there are some good linkages there. And I think given the ambitions of of these countries in the Middle East, they're all looking to really roll out these next-gen services. And one other point, sorry, before I close, I forgot to mention is that Saudi Arabia, you know, PIF, their sovereign wealth fund, is actually a very large shareholder in Saudi Telecom. And as we all know, they also own SpaceX. And so just as a Point of validation. Saudi Telecom was an MOU. It was a partnership signed in 2023. And since that point, they had been evaluating Starlink and AST SpaceMobile, and then they just basically hitched their wagon to AST by committing to a 10-year minimum revenue contract, $175 million prepaid. And so that That's just another validation point in the market where you have a sophisticated party with unlimited financial means and capacity. And just like Verizon, instead of going with Starlink, they went with AST SpaceMobile. So I'll leave this space with that note. And yeah, we'll look to catch up again in the coming days. And yeah, great quarter. And, uh, looking forward to the launches. So, uh, I'll end it there and we'll talk again soon. Thanks everyone.
[00:55:30] Speaker A: Thanks for listening to the AST SpaceMobile Podcast. If you enjoyed this episode and you'd like to help support the podcast, please share it with others, post about it on social media, or leave a rating and review. To catch all the latest news about AST SpaceMobile, make sure to subscribe. Thanks again, and I'll see you next time.
[00:55:49] Speaker B: We're doing something very, very big. Connecting with this technology, we can really affect a billion lives. AST SpaceMobile is the only company that has proven technology to deliver cellular broadband connectivity directly from space to the everyday smartphone. People will just basically turn on their phone and be seamless. Regardless of where you are, we don't want the user even to know that it's connected by satellite. Our role is to bring this into reality, always in partnership with the NMOs. Listen.
[00:56:34] Speaker C: Mmm, waffles.