Anpanman - The Space Frontier: AI Data Centers and the Trillion Dollar Opportunity

[00:00:07] Speaker A: This is the AST SpaceMobile Podcast.
[00:00:10] 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: Hey everybody, what is good? What an amazing day for AST SpaceMobile, the space sector. I wanted to do a space and, and talk about it, um, so I'm going to talk about AST and space in general, uh, in the first part of this, this, um, space, and then I'm also going to talk about T1 Energy as well. But, um, but yeah, what an amazing few weeks. I, I know People were, like Ted says, you know, nothing drives sentiment more than price, and people were really in the pits when AST was at 63 on May 5th, which is when I tweeted that the endless rally was going to start, which happened to be quite prescient. But I, you know, I was inspired by this tweet yesterday from Keaze MN. He goes by K-E-A-Z-E, and I retweeted it. Let me just read it for you. So here he says, I think it's easy for us today to look back at all of the major investment opportunities that have existed over time, railroads, early computers, oil, shipping, dot-com, and it's easy to feel like those opportunities just won't come around again. Then I see stuff like this and I'm reminded that space is that opportunity for me and for right now. Far into the future, this may well be the biggest opportunity of all of them. Super exciting. He tweeted this as a response to the Blue Origin factory tour that Jeff Bezos gave, which I enjoyed every minute of that. That was such an informative and inspiring tour, and it just feels great that ASD Space Mobile has partnered with Blue Origin. But but yeah, that there was a there was a moment of reflection for me as well, where and I talked to you know the guys who do the space. Stocked Weekly and some Space Mob as well. We are really lucky to be this early and in the middle of what is a transformational industry, right? I mean, space, at least in the '70s, '80s, '90s, 2000s, space from research and development of space exploration and Space Lab and International Space Station, I mean, and all these things, there were technology spinoffs that benefited humankind, right? So there was various materials and developments of technology, advances in computation that, um, that eventually trickled down to everyday life. But now we're at this point where we are pushing forward compute, uh, exploration and, you know, medical research, whatever, what have you, into space, right? So we're kind of at this next leg where, uh, I joked around with some of these guys, um, Maybe it was like 5 years ago, 4 years, 3 years ago, even 2 years ago, people laughed at the space sector. I don't think anyone could see the amount of opportunity that was ahead, and it wasn't except for the few people, the crazy ones like you and me, that got involved in space early on. Of course, there's a reason why these companies had to go public via SPAC, because traditional investment banks would not underwrite them. No one wanted to touch space. It was too risky. Business models maybe didn't make sense. It was too early. So if you go to Goldman Sachs or Morgan Stanley and bring a traditional space IPO to the commitments committee, they would laugh you out of the room. They're like, we're not taking that thing public. The only way to indirectly do that was through SPACs. So you had companies like this little company called Rocket Lab, another little one called AST SpaceMobile, Planet Labs. These guys all went through the speculative route of SPACs. And for retail investors, that was a way to— I mean, all these companies were essentially pre-IPO level of development. For AST, when it went public, it was basically a Series C round. And so the negative side of SPACs, obviously there were a lot of half-baked ideas or companies that should not have gone public. And obviously retail investors and some institutions, they got hurt, but then there was a unique and select group of companies that if you invested, you did your research, and you stuck with your conviction, have ended up being multibaggers. And they are the space leaders. I mean, putting aside SpaceX, which is going to go public here, and Blue Origin, which is going to raise a private round and eventually go public, these other companies are at the forefront of these trends in space and whether that space and/or defense they're going to have a huge hand in it. And so we are lucky, whether it's pure luck or serendipity. For me, AST SpaceMobile, I probably would've eventually got to investing, but I kind of backed into it. I owned a bunch of warrants in New Providence Acquisition, and by the grace of God, they did the deal with AST SpaceMobile. And so I got a head start on most people, and I reviewed the presentation, had a discussion with Abel and I was like, this is the next big idea. I need to invest in this. I'm going to write about it. And this is going to be an important position for me. I didn't realize at that time that I would be holding the stock for 5 years and it would grow into something this big, but the potential was there and the opportunity was there. And so unlike the people over the last several years and Rocket Lab holders, Planet Labs, any number of companies, you name it, they all kind of went through the same thing where you had doubters, you had legacy space guys say, oh, that doesn't make sense, especially legacy guys where they were used to doing things the old way. It's like the old defense primes, right? Where they couldn't see beyond what was defined for them as what was possible. Whereas for AST SpaceMobile, the whole idea of connecting an unmodified phone to a satellite was a preposterous idea. It's like, you can't. close a link budget. Are you crazy? How are you going to do broadband? Those satellites, once they're up in space, first of all, you can't even get one up there, and then it's going to melt. It's not going to work. That's the type of thinking that you need to create new markets and solve problems. That's why these legacy consultant guys, I mean, they've been wrong this entire time and they still stick with it because the egg is on their face. And yeah, they're going to, I guess, take that perspective to the grave. But lucky for us, these detractors over the last 5 or 6 years who have complained about these companies, who've said it's not going to work, fortunately we didn't listen to them and we bought and we continued to buy over those years. And many people have retired and become millionaires. I mean, people talk about the SpaceX millionaires, millionaires in AST SpaceMobile, whether it's employees or investors. And that also includes Rocket Lab and Planet Lab and all these other companies. But I think it is important to recognize where we are, which is the fact that space is the biggest, as SpaceX laid out, and the market is finally waking up to this, like, oh, maybe they are right. It's like space in general is the largest TAM market there is. And the running joke was that You can have the largest ham in space because it's infinite. And everyone kind of laughed that off, but in reality, there's quite a bit of truth to it, right? Because it's not constrained by resources or things here on Earth. Obviously, there are constraints like physics and trying to get weight up to space, and there's those types of things, but they can be solved, right? And then once you're out there, if you were to go to the moon and blow Blue Origin's been talking about being able to manufacture different components from materials on the moon. And so there's all these new markets that are opened up. And so one of the things that I've been harping on, which is the importance of connectivity, which if you look at the SpaceX IPO, what is it? I think like 84% of, or 70% of the profitability, or sorry, revenues come from Starlink, and then 104% of the EBITDA, which of course, you know, obviously xAI is not making money, but, um, all the profitability is supported by connectivity, which is why like all these space companies are trying to push into connectivity. Legacy guys are trying to like reinvent themselves and try to catch up. Um, but connectivity and around Earth and eventually kind of into the stars, um, that is the profit engine and what's going to underwrite the ability to go to the moon, to go to Mars. And so that's a business model, right? And so it's great if you want to have pure play exposure, like there's ASD Space Mobile, there's a few other players as well, but the market is huge and that's where the growth is, right? But then ultimately what the next step, which US Secretary of Commerce Howard Lutnick tweeted today, because he met with Gwynne Shotwell of SpaceX, they're talking about AI data centers in space. And I know some people have pushed back and said, well, AST, they should focus on the direct-to-device constellation and the military applications. Sure, absolutely they should. But 1 to 2 years from now, that's a very short time. Me as an older guy, maybe for some of you younger people, when time goes by, it seems like it goes by slowly, but for someone at my age, time goes by very fast. And so 1 year goes by in a blink of the eye. And so I think folks, you have to start thinking about what's next for AST, for example. Like, you know, the company has almost 4,000 patents and, um, you know, it's building these, the largest, you know, if you think about what, uh, Ashen, Leo Ashenbrenner talked about, which is the critical component for AI, um, data centers and, and AI superiority, it's electricity, right? And so even Elon Musk has talked about going from 20 kilowatts to eventually 100 kilowatts of power in space, which it's a funny metric that he mentions because AC Space Mobile already has that. For example, K2 is trying to— I think their first test satellite is 20 kilowatts and they eventually want to get to 100 kilowatts. We're already there. We're actually probably, in my estimation, around 120 kilowatts, right? Because the ASD Space Mobile, the phased array, if you look at the solar cells that they use, which are from Sharp, You do the calculations, they can generate a little over 100 kilowatts already. And then the tail, which we've talked about, which is, I guess, a bit confidential to a degree, but the tail adds probably another 20 kilowatts of power. Now, it's not as if AST has solved all the heat issues. Now, they can operate a satellite and dissipate the heat, no problem. But you have to remember that AST satellites actually cycle in and out of the sun. And so there is some cooling elements where they don't, they're not completely generating power all the time, but you can solve that through various means, right? Like I was talking about it with another Space Mob member the other day where the antenna elements that pop up on the bottom side of the Micron, those can actually, if you can imagine re-architecting that where they're heat sinks and instead of having antennas for communication, they're heat sinks that pop out And because they're on the other side of the sun, if you had a sun-synchronous orbit, you could use those to dissipate a ton of heat. So there's a lot of things that they can do. But the reason why I think it's important is that you have a company that's already making a several-ton satellite that has onboard processing, currently FPGAs, but they're going to be ASICs. And then eventually, if you want, you could put TPUs or GPUs on them. But these satellites already exist. and the company has already solved those problems. It has patents all around it. Um, and so it was told to me from Hennessy, who was an early long-only investor who got— who planted the seed in my mind. These guys are like, you know, they're— they were way ahead in terms of their thinking. Um, this was like back during the Block.one launch, uh, back in September of 2024. Uh, we were at the bar over at the courtyard at Titusville, and, um, one of the portfolio managers, Dave Rainey, was telling me, he's like, There's going to be several pillars of business for AST. One of them, which I think we all know, obviously, is the patent licensing business, where they've developed so many fundamental patents that they could license those to other space companies. But then he talked about defense, commercial, but one of the things that I didn't really comprehend at the time, which was very like a key foresight, he was saying power. He was telling me, These satellites are the largest solar arrays in low Earth orbit. They're going to generate a ton of power, and there's so many things you can do with that power. And it didn't really dawn on me. I was like, okay, yeah, that sounds interesting. But then of course that was a precursor to this discussion of AI data centers in space. And then once I heard, once I kind of put the two together, it's like, oh yeah, we have the largest power generating satellite in space. And so what's the value of that? And we already have compute power on it. So you can just reconfigure some of these things and optimize it. But for us to make the next leap to AI data centers is, I mean, relative to where these other players are, is very easy. And so I'm not advocating, by the way, that the company should change directions or pivot. No, that's not the case. You definitely want to deploy the constellation. You probably want to deploy the 3 constellations, the low-band Bluebirds, the mid-band Bluebirds, and then Maybe it's a government shell. But then after that, just imagine you're going to have this capacity to manufacture what by then will be perhaps 10, 12 satellites a month. That capacity can be used productively to other areas. And the most logical, the huge massive TAM is going to be AI data centers. And so once we finish those constellations and we're up and running and we're generating billions of free cash flow every year, um, let's go pursue it. Let's do it. Like, why wouldn't we? It doesn't make any sense. Like, we— Google, do you want AI data centers in space? We'll work with you. Um, Blue Origin, do you want— you know, Amazon, do you want it? Uh, any number of players, like, they should be coming to AST. There's probably, um, you know, I think there is a Skunk Works team that's working on this problem now. Um, but the pivot is— it's not a pivot, it's, it's a natural progression where once we get into this point where we have the constellation— and by the way, like, It was disclosed yesterday in the Legato filing that our satellites, the expected lifetime is probably going to be closer to 15 years versus 10 years. The maintenance CapEx for us is going to be very low. And so it's not as if we're going to have to continue to manufacture a ton of satellites to replace ones that are falling, like Starlink, who's in very low Earth orbit. Their satellites are probably going to have an orbital life of 3 years. So they've got to essentially create a new constellation every 3 years. For us, we're going to have a lot of capacity to build multi-ton satellites that are going to generate a shit ton of power that have processing built in. Again, just replacing the ASICs with your favorite GPU or TPU. That's totally something that we should do. And I guarantee you in the next, I don't know, maybe the next year, once the company has cadence going and the constellation's up and we're beaming down service, There is going to be a new disclosure at some point where we talk about the AI data center opportunity and we're working with Google and any number of players. Google was a logical one because they're obviously a strategic investor, but that's going to happen. Maybe I should tweet it so then later I can refer to it and be like, hey, look, see, I told you guys. But I mean, we've been talking about AI data centers since I think fall of last year. So it's going to happen and it's not a distraction. It's not a pivot. It's just a natural progression into something that we're already doing. But yeah, so I think as part of this, that tweet of us being at the right place at the right time, energy fits in that too. And that's why I mentioned T1 Energy as well, which is making solar panels and solar cells domestically in the US. But all this stuff fits together. And yeah, we're very lucky because a lot of these generalists and institutions are just learning about it. They're reading through the SpaceX IPO, prospectus, the bankers are going to be taking the team, Gwynne and maybe Elon for some of the biggest meetings, but they're going to be hitting up Boston, New York, California, Denver. They're going to hit all the places where the large funds are. And these people are going to be learning more about the sector, the opportunity, which is the largest in human history, the TAM, which I actually agree with. And then they're going to also learn about these other companies like, oh, what are the other companies in the sector that are, by the way, mentioned in the S-1? I mean, I would be curious, and from what I heard, the roadshow presentation itself, obviously it's going to look very sharp and there is a mention of AST SpaceMobile and some comparisons from what I understand. And if someone has access to it, by the way, please DM me and give me a copy because I'd love to go through it. But That's the first time that a lot of these guys are going to hear about ASD SpaceMobile. And so I think there truly is going to be this halo effect. Now the detractors are going to say, well, once SpaceX goes public, everyone's going to sell these other stocks and then buy SpaceX, which by the way, I'm going to buy one share to track SpaceX, but I personally don't have much of an interest in buying it at a $2 or $3 trillion valuation. But yeah, it's not as if there's this massive group of people that are following space right now and investing in the sector. If anything, I think the exposure to space, or there's no exposure or limited exposure. If anything, there's probably more retail exposure versus institutional exposure in space. And so with the SpaceX IPO, it's not as if I think that people are going to be selling other space stocks. I think they'll be selling software stocks or other areas that maybe are not performing and then invest in SpaceX. And then again, there's going to be this natural progression to look at this other sector and see what other ways to play it. Because with SpaceX, by the way, it's not a pure-play space company. You're buying xAI, you're buying X, Twitter, and then you're buying Cursor, which is going to be acquired, I don't know in how many— I think it's like a month or two later. But there's going to be all this stuff that's thrown in there. And so for space investors, they're going to look and say, okay, well, what's a pure play way to play this trend of these companies, which are going to have a lot more leverage to Golden Dome, defense spending, exploration? And they'll be like, oh, look, there's this company called Firefly or BlackSky doing Earth observation or Planet Labs or Redwire, or you name it. Rocket Lab, AST SpaceMobile. Oh, there's other ways to play this. And so that's going to be the natural progression where people learn about it and then they realize, like, I don't know if I want to own all this other stuff. And eventually, by the way, like, when SpaceX merges with Tesla, it's like, okay, do I really want to own all that stuff too? And, you know, there you can make arguments for why that could make sense or why you want some exposure. But as I said in my space the other day, I think eventually the game plan, like, once xAI is Ideally, and hopefully at a point where they're generating enough cash flow, my guess is that Elon will— SpaceX itself will probably trade at some conglomerate discount, which is kind of hard to fathom right now because of the high valuation. But I think at some point in the future, they'll probably spin off xAI and X because to me, it doesn't make much sense to wrap it in. It does make sense now for Elon personally because you know, somebody has to subsidize those losses, which is what Starlink is doing. But eventually, if SpaceX trades at some discount because of that, he'll, you know, and this is part of financial engineering 101, he'll eventually, you know, spin it off. But yeah, so I did want to, that's a very lengthy preamble, but I do want to talk a few things about AST first. I did tweet out the other day or yesterday when I was in Vegas and I talked about this in other spaces, This dynamic kind of happened in 2025 where I hadn't been on this guys trip in a very long time for various reasons, but I finally went last year. The stock was like at $20, $25 and I was super happy because we had obviously rallied to $39 over the summer of 2024. And then we consolidated and I know a lot of people were upset when the stock was between $20 and $25, but for me, I was super happy because obviously the stock, just 12 months earlier, was at $2. So I was happy celebrating with friends, and then a number of positive things developed over the end of May, and then we went on this second June run, which was— the first time was 2024, that was post-AT&T and Verizon deals. Then 2025, there were a number of positive catalysts that came in. I think Legato approval came in or that deal went definitive. Another thing was the Trump-Elon fallout. I think another round of that happened in May. And so we went on this massive unidirectional run in June. We went from $20 to, I think it was high of $55. And so you just look at, and there's no science behind this, but you look at the pattern of our consolidation. We obviously hit a huge peak of $129 in January, and then we sold off, which you could attribute is partially January effect or whatever. But we went through this period of consolidation in May, and obviously we bottomed at $63,000 and people were upset. But for me, when I was on this trip, I had the confidence, I guess, maybe it was misplaced, or it wasn't misplaced because it ended up being true, but that was from this Vegas trip, it was going to be this precursor to this big run. There was reason for it. We had At that time, obviously the bad thing was that Bluebird 7 didn't get placed in the proper orbit due to Blue Origin, a snafu there, but we had a lot of things to look forward to, which was the shipment of Bluebird 8, 9, and 10, which 2 of those have of course come to fruition and that's happened. I personally expect, I think the 3rd, Bluebird 9, is probably going to get shipped over this weekend, if it already hasn't. And then of course we had the Falcon 9 launch in mid-June, and then we've got another one likely to happen in early July. And so that second batch is probably close to getting to the point where they're going to ship it. And so that, we have Golden Dome award. I think we had like 3 military awards, which they couldn't disclose in detail in the Q1 call, but I think there's a few other things that are cooking right now. Blue Origin, New Glenn, that's going to be coming back online and I think there's going to be a static fire relatively soon here. So there were a lot of positive things that were on the come, which is why I was excited about it. And so fortunately for me, and for all of you, it came true. We've been in this move up over the last several weeks. And one big thing I forgot is of course the SpaceX IPO, which was, it's about as an obvious catalyst as there is. whether it was me or Rocket Lab guys or any number of people, it's like, oh, SpaceX IPO, it's going to be in June? That's going to be a big catalyst. And you had all these detractors when the stock was at $63, they're like, oh no, it's not going to matter. It's like, yeah, I don't know how anyone can spell it out for you in terms of catalysts, human psychology, all that stuff. It's going to be a positive catalyst for the sector, which it has been and it will continue to be going into June. Now what happens after they price it and how it performs, we'll see. But the good thing for AST in particular, you've got all these positive things that are coming. And so I think the follow-through will continue. But I meant when I said it before that I think we're going to breach an all-time new high. Previously it was, I think intraday, like $128. We're going to blow through that in the next few weeks. But anyway, it is interesting to note that yesterday's real-time short interest Uh, came down for the first time in the last 8 to 9 days. And so why this is important is that, um, the, the new short interest is $66.8 million. That's down from $68.3 million. And by the way, this data kind of adjusts. And so the data the day before that I saw had it at $69 million, but then it got— that got adjusted down to $68.3 million. And that's partially due to, I think, prime brokers who report this information to, uh, Market, which is where I get the information. Um, Sometimes some reports will come in late. But this is the first time it's come down in 8 to 9 days, and that's an interesting data point because let's see here. Short interest has been at the all-time high at approximately 68, 69 million for all these days. And that's in the face of the stock price moving up through that entire period. And so the reason why that's important is that we have a pretty decent amount of shorts that are related to convertible arbitrageurs who short the stock when the stock goes up because they're covering deltas, or sorry, they're putting out more deltas. When you hedge the underlying warrant, when the stock is up, you short stock. When the stock goes down, you cover stock. So what this tells us is that as the stock has gone up and these guys yesterday, or over the last few days as the stock has gone up, there has been some short covering. But you would expect that the amount from yesterday to today, you would expect the short outstanding level, the short interest to actually be higher. It actually went down. So that means that in addition to the convertible arbitrageurs shorting more stock, the net effect was short sellers actually covered quite a decent amount from yesterday to today. So that's important because that could be the start of a trend where these guys are throwing in the towel. And they're starting to cover. The reason why I point this out is that we saw the same exact dynamic back last June when the stock went from $22 to $55, and then it topped out, I think it was in July at like $60. And so right before that run, implied volatility was pretty low, the short interest was quite high. And then systematically over that period of time, it was like a unidirectional movement. Every day the stock was up, The short interest came down. And so I think we're kind of in that same dynamic where these guys, whoever they are, and by the way, this could also be some of the SpaceX investors who had used the sector to kind of hedge their positions. These guys are going to be probably covering their stock heading into that IPO. And so that's going to be a big tailwind, I think, for the stock. Um, let's see, moving on. So Blue Origin factory tour, uh, for those that haven't seen it on CNBC, definitely recommend it. Uh, one of the few— I mean, aside from being very inspirational and, and informative, uh, there were some pretty good nuggets that came out of there. For example, Jeff Bezos talked about the fact that they're building— they're working on booster number 5. And so, uh, for those that remember, booster number 1 is gone. Uh, that was the first one that, that, uh that didn't land. It went out, they didn't have a refire, and then it landed in the ocean. So right now, the company is using booster number 2 and booster number 3. Booster number 4 is probably pretty close, as I had tweeted out, I think it was like a week ago. I think booster 4 is supposed to be finished sometime over the summer. And then they're already working on booster 5, which probably comes online sometime in the fall. Yeah, fall. So, um, that's important because the company Blue Origin is trying to get on this 30-day cadence where, uh, once a booster is used, they can then refurbish it and launch it again in 30 days. Um, with 2 boosters, they can basically launch every 2 weeks, uh, under that, that, that framework. And then of course, as you add more boosters, they can launch more frequently. It got to the point where, um, Bezos said, I want to launch Every week, then every day, and then every hour. I don't know if they'll eventually get to every hour, or I don't know whose payload they'll be launching every hour, but I love the ambition. So that was a very interesting data point, 'cause I think some people have questioned, is Blue Origin gonna be at a point where they can launch frequently enough? And it's like, well, if you've got 4 boosters in the rotation, you can launch every week. And so that's, from an AST SpaceMobile perspective, if you get up to the 8 Bluebirds and you're launching, they're obviously not going to launch every week on Blue Origin, but if they did, that's 8 times 4, that's 32 satellites in a month. And obviously, they've got to get production cadence up, but you could have the entire constellation up in 3 months. Um, the rides to space, uh, is going to broaden out and there's going to be more capacity. And, um, and that's good. That's good for the entire industry. Also, uh, Bezos talked about how they're now making a BE-4 engine, which is the main engine on the booster. They're making one engine every 4 days, which is insane. And it's not just for Blue Origin consumption. They also, um, you know, that, that engine is also used by ULA Vulcan Centaur. So, um, so that's good because I think, you know, it's unclear, at least in the first iteration of Never Tell Me the Odds, they replaced, um, I think they replaced like 5 or 6 of the engines because— and part of it is they're upgrading the engine. So each time they, they, um— oh, check my comments. Bluebird 9 has shipped. Okay, great. Uh, so I guess in real time I, I didn't see that, but I will, I will take a look. Um, but yes, uh, going back to what I was saying, um, they— for the second flight of Never Tell Me the Odds, they actually replaced 6 of the engines because they were upgrading them. Uh, and that's going to be the case for Blue Origin. They're going to iterate, uh, improvements and, and get to a point where launching 8 Bluebirds is, is going to be a piece of cake. Um, the other thing that they said, uh, is— and this was quite interesting— they are now on the number— on number 15 for the second stage. And so they can launch, let me see how many there have been. So they can launch 11 second stage or 11 Blue Origin New Glens, right? And these are expendable. And what was cool, what Jeff Bezos said in a very Amazon way of thinking, he was like, we have 2 teams. We have one team that's focused on getting the expendable, not reusable, but expendable second stage rockets down to such a price that's going to be so cheap to use that is going to be more economically attractive than any reusable vehicle. And then he said, we have a second team that's working on GS2 that is going to be reusable, and their focus is to make that so economic that the expendable one isn't going to be attractive. And so I thought that was a pretty cool disclosure, but it's important that you know, for the second stage, that they build as many of these things as they can on the expendable side. Because obviously, if you're gonna be launching every month, every week, or whatever it is, um, those stages, uh, you're gonna need a lot of them, right, until you get, uh, back to a reusable one. I will say though that, uh, reusability is a very difficult problem to solve. Um, you know, I think Starship, uh, we all hope that they'll get there, but, um, when it comes to the amount of stress, uh, that vehicle on reentry has to overcome and survive and hopefully not shed too many heat tiles. That's a very difficult problem. And so I don't think— I mean, and I'm not a space engineer, but I think that's a problem that's going to take quite some time to solve, if it is solved at all. You could see SpaceX pivot where Starship, the upper stage, ends up being expendable versus reusable. Let's see here. So I'm going to move along. Let's see. Oh, I did want to talk about this because I know, I mean, I've used these products from time to time very judiciously, but I did want to talk about leveraged products because there was another 2x AST SpaceMobile leveraged product, an ETF that came out yesterday. A word of caution, if you ever do trade these things, and they can be, if you're a degen or speculator, and you feel like you have edge, they can be helpful. So what these products do is they, through derivatives, they deliver 2 times the percentage performance of the underlying. So if AST is up 5%, the leveraged product should in a day give you performance of 10% up. And so what's important is that over time, these products, because of slippage, the use of derivatives, but also because of compounding, If you're in a period where a stock kind of trades sideways or chops, then these products actually decay and lose value. They approach zero. And so if you, I guess from a mathematical perspective, and I've done this before, if you were to go into a spreadsheet and just kind of play with numbers and have a hypothetical stock trade up 2%, trade down 5%, trade up 4%, trade down, and kind of show a kind of sideways pattern, you'll notice that the value, because of the chop, the value of that price goes down over time. It asymptotically approaches zero. And so these products are very dangerous. It's something that you would invest, or not invest, you would trade for a short period of time if you think that you have some edge and that maybe you are in a period where, and this is where the product can be useful, if you're in a period where you think there's going to be unidirectional movement, meaning over consecutive days or at least a majority of days, the trend is going to be up. And the underlying might be up 2% one day and the next day it's up 5%, the next day it's up 3%, maybe the next day it's down 1% or 2%, but then the next day it's up 10%. In those trends, if you have unidirectional movement, this is where compounding actually magnifies itself. you can have these situations where a double-levered ETF is going to significantly outperform the underlying by more than 2x, way more than 2x, because of compounding, where the number gets bigger. If you were to have— and you can just do the math. If you were to take a stock, assume some stock price, and it goes up 5%, and it goes up 10%, the next day it goes up to 12%, and then goes up 5%. If you compare the 2x versus the single, the underlying that has half the performance, because of that magnifying effect on compounding, the leveraged product is going to significantly outperform. It's not going to be 2x, it's going to be multiples of that. I mentioned this stuff because I know people do trade these products, and it's, again, it's not something that you should hold onto for a long period of time. It's only if you have some level of edge. Definitely do not do margin. Definitely do not do options on these things because you're playing for really high implied volatility on top of a product that's already levered. And so yeah, every once in a while, like, you'll be able to win in that scenario, but oftentimes you're going to lose. So yeah, just be careful. Be careful with those things. Maybe I'll pause there. If people have any questions or wanted to point things out, happy to cover those. Let me just take a quick look here because someone said that Bluebird 9 is shipped, which I want to see if it is. Um, let's see. Oh, okay. Yeah, so, um, so 12 minutes ago, the last Bluebird, Bluebird 9, has officially left the Texas facility. There's a video which I'm going to watch here, which is great. Um, so we've got all 3. So there, for those that don't know, like, once they're down in Florida, they're going to enter into a payload processing facility SpaceX, and they'll be put, you know, encapsulated into a SpaceX Falcon 9 fairing. And then they'll be, you know, there's some like test and integration stuff going on, but then they'll be ready for launch in mid-June. The other thing I would note is that we do have AST, I believe, I could be wrong on this, but I think I read it. I believe we have got some space down at Cape Canaveral and we are hiring somewhat, a few people there to do, uh, payload receiving and processing. Because we're gonna have so many Bluebirds that are being shipped down to, uh, Cape Canaveral, we actually need like an entire organization down there to receive them and to help with integration either with Falcon 9 or Blue Origin, um, New Glenn, or ULA Vulcan Centaur, which is very exciting. Um, but yeah, that's— I— someone had asked me like when Bluebird 9 was going to be shipped, and I said it's probably gonna be over the weekend, but we got some good news. It's happened already. So I would expect a tweet from the company like over the weekend that they will say that Bluebird 8 and 10 have been, you know, have showed up at Cape Canaveral. And then of course, you know, we'll see another tweet possibly that 9 is there as well. So that's kind of my AST portion of this chat. Let me just look if anyone has questions. here, or wants to add. Um, all right. Oh, someone asked, would love to hear your thoughts about SpaceX S1 TAM numbers for direct-to-device. That's a good reminder, thanks. So, um, they did disclose TAM numbers. I think it was like $750 billion for direct-to-device, which by the way is a separate market from the underlying, uh, you know, broadband connectivity mobile market. This is just for direct-to-device. And then they also talked about broadband, which I think, fixed broadband, which is probably around $800 or so billion, I think. I did wanna point out an important point is that when our mid-band constellation goes up and we're able to utilize the 45 to 50 megahertz of L-band spectrum here in North America, and then some quantum of spectrum in S-band globally, that network, because it's using mid-band spectrum, that actually will eat into the fixed wireless side of what Starlink's doing and OneWeb and our friends at ViaSat, that business is actually, we can go after that market because the data throughput and the performance is not gonna be at the same level as Starlink to your home, but it's gonna be pretty damn good. And you're probably talking on the orders of, well, maybe 200, 300 megabits per second, maybe more, but obviously that's gonna be shared. But I think it's important that this is not just direct-to-device broadband, but once that second shell gets up there, we are going to start encroaching on the fixed wireless market, which is very exciting. And so to the extent that you need a higher level of broadband connectivity, but you don't want a big dish on your vehicle or whatever, you can use L-band, the Legato spectrum that we're going to be deploying, S-band globally. You're going to be able to use your mobile phone or hotspot or tether, whatever you want, right? That's going to give you a pretty high-level performance. I did talk about like how with AI optimization and low-band Bluebirds and mid-band Bluebirds and eventually the C-band, which we don't talk much about, but that constellation, you're probably gonna get within a cell, you're probably gonna get well over a gigabyte of performance, right? With carrier aggregation and MIMO, maybe it's multiple gigabytes, I don't know, but, or gigabits per second. So yeah, that's in the future. And so when thinking about these TAM numbers, I didn't wanna muddy things up when I highlighted some of these disclosures, but $750 billion is kind of the starting point. And then you can also project forward into the other portion of that, which is the fixed wireless business. The other thing I would mention is that there was a really interesting number that was disclosed, which was $632 million, which quite candidly was a very large number in my mind. In the disclosures, they talked about the consumer mobile connectivity, uh, accounting for $632 million of growth in 2025. And, uh, some of our legacy consultant friends said, oh, that's the size of the business. You have to read— and by the way, like, this guy Tim Farrar, he reads language very closely and he tries to contort and use it, uh, in his own special way. But, uh, if you look at the language, it says that that was incremental growth. So I'm not sure what the baseline was for the business for 2020, essentially what they generated in 2024. But there it says the incremental growth on the Starlink mobile business was $632 million in 2025. Now, my guess is that's not just service revenue. There probably was some contract or activation as well thrown into there, but that's a pretty big number for an intermittent crappy service that candidly is not anything comparable to what AST is doing. So that's pretty damn bullish. I don't know any other way you can spin that. The other thing is I think there was an $18 ARPU number thrown around for Starlink Mobile, which I think I didn't look at that too closely, but whether there was some debate as to whether that's through partners or that's actually a standalone product, either way, whether that's through a partner or it's a standalone product, that ARPU, that average revenue per user, is really high. I think most people underwrite the AST SpaceMobile case at around, call it, in developing markets, single digits, maybe $5 at most, and then developed markets, maybe $10. So $18 is a huge number. And if they're able to get that, then yeah, we're not bullish enough. But then, as I mentioned before, I didn't You know, AI data centers is another extension that eventually the company will get to, but you know we won't talk about that. I mean, let's just focus on what we have in front of us. But let me see here. Is there any other comments? All right. So that's that's my that's my talk on ASD. I just wanted to briefly cover. So if you're if that's all you're interested in, you can drop off now. I just.
[00:43:46] 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.
[00:44:09] Speaker B: We're doing something very, very big, and I think with this technology we can really affect billion lives. AST SpaceMobile is the only company that has proven technology to deliver cellular mobile connectivity directly from space to the everyday smartphone. People will just basically turn their phone and be seeing this. 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 NMO. Listen. Mmm, waffles.