Momentus Q2 2023 Earnings Call Transcript

Quartr
Provided by Quartr
August 14, 2023

There are 5 speakers on the call.

Operator

Good afternoon, ladies and gentlemen. Welcome to the Lumenomics Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen only mode and please be advised that this call is being recorded. After the speakers' prepared remarks, there will be a question and answer session. And now at this time, I would like to turn the call over to Mary Horne, Investor Relations for moment.

Operator

Please go ahead, Mary.

Speaker 1

Thank you, and hello, everyone. Welcome to Moventis' Q2 2023 earnings conference call. With me here today are John Ruth, Chief Executive Officer of the company and Chairman of its Board of Directors as well as Eric Williams, Chief Financial Officer. Each will provide prepared remarks. Following these prepared remarks, we will take questions from analysts.

Speaker 1

Earlier today, we issued a press release and made a slide presentation available on our Investor Relations website, which provides an overview of our business and financial highlights for the quarter. You can download a copy of the release and presentation slides at investors. Momenta. Space. During today's call, we will make certain forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934.

Speaker 1

Forward looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward looking statements in this communication. You should listen to today's call with the understanding that our actual results may be materially different from the plans, intentions and expectations disclosed in the forward looking statements we make. For more information about factors that may cause actual results To materially differ from forward looking statements, please refer to the earnings press release we issued today as well as the company's filings with the Securities and Exchange Commission. Readers are cautioned not to put undue reliance on forward looking statements, and the company specifically disclaims any obligation to update the forward looking statements that may be discussed during this call.

Speaker 1

Please also note that we will refer to certain non GAAP financial information on today's call. You can find reconciliations of the non GAAP financial measures to the most comparable GAAP measures in our earnings press release. None of these non GAAP financial measures is a substitute for or superior to measures of financial performance prepared in accordance with GAAP. With that, I'd like to turn the call over to our Chairman and Chief Executive Officer, John Grud.

Speaker 2

Thank you, Mary. It's a pleasure to be here today to provide an update on the progress we have made at momentous over the past quarter and our Q2 financial results. After I make my comments, our CFO, Eric Williams will take you through the financial highlights and outlook. In the Q2, Momentous made solid progress toward our goal of being one of the market leaders in providing satellite buses and in space transportation and support services for U. S.

Speaker 2

Government and commercial customers. We are at the forefront of this expanding market and possess key competitive advantages. Notably, Q2 marks momentous' first $1,000,000 revenue quarter with Q2 earnings finishing at $1,700,000 for the quarter. In my remarks today, I'll discuss the progress we have made in our long term strategy for growth and profitability. First, we continue to see growing interest from both government and commercial customers, which are expected to translate into contracts over the coming months, and I'm happy to have more details to share today on an important contract with the Space Development Agency.

Speaker 2

We have also signed a contract for a new hosted payload customer. I'll discuss these in further detail later. 2nd, we continue to operate 2 VigorEye Orbital Service Vehicles or OSVs in low earth orbit, which is the 2nd and third VIGORIDE that we launched in January April 2023, respectively. On our 3 VigRide missions conducted to date, we have successfully demonstrated our core technology, which is operational in space. With 3 spacecraft on orbit, we've accrued significant flight heritage with about a year of in space flying time.

Speaker 2

3rd, we are evolving our business strategy to lean into significant markets where Momentous has clear advantages. For example, we recently announced our M1000 satellite bus offering. The M1000 satellite bus is based on our successful VigRite Formal service vehicle and builds on its flight heritage to offer a low cost, flexible and capable bus for government and commercial customers. In fact, over the past quarter, we have submitted proposals to U. S.

Speaker 2

Government customers like the Defense Department's Space Development Agency and to commercial companies to produce satellites using to maximize our competitive edge and plan to demonstrate the functionality and operability of this technology in space over the coming months. Turning to Slide 5. Momentous launched 3 orbital service vehicles in less than a year from May 2022 to April 2023. During these missions, we've deployed a total of 15 customer satellites and provided hosted payload services for a groundbreaking scientific mission from Caltech, a leading technical university. We've demonstrated our technology in space, including our pioneering and environmentally friendly thruster that uses water as its propellant and shown our ability to perform on our commitments for our customers.

Speaker 2

Turning to Slide 6, our Vigride 5 mission, which was launched in January 2023 is ongoing and the spacecraft remains in good health. During the Vigride 5 mission, momentous deployed a customer satellite from Kosmosus in Singapore into low earth orbit and also carried a large hosted payload for Caltech. Since then, momentus has been providing ongoing hosted payload services to Caltech's Space Solar Power Demonstrator or SSPD mission And Caltech reported that its payload recently demonstrated its ability to wirelessly transmit power in space and Beam Powered Earth. Momentis will continue to provide hosted payload support to the SSPV over the coming months as it continues its operations. Our contract calls for us to provide hosted payload support to the SSPD mission for at least 6 months and up to 2 years under a contract option.

Speaker 2

Hosted payload missions like we are providing to Caltech are more profitable than transportation missions, particularly for larger hosted payloads and longer duration missions. During the BigRide 5 mission, the momentous team conducted inaugural testing of the microwave electrothermal thruster or MET used on the spacecraft that uses water as a propellant. This has included 35 firings of the thruster And a successful altitude raise of the VigorIde Orbital Service Vehicle by more than 3 kilometers. On the VigorIde We operated the MET successfully in space at full power across the range of durations for firing that we plan to use operationally to deliver satellites to precise custom orbits and to provide in space infrastructure services like hosted payloads. Momentous is a pioneer in bringing this efficient and environmentally friendly propulsion technology to market.

Speaker 2

We're proud that the MET has shown its ability to operate as intended to perform these missions in space and we look forward to using it to support commercial and U. S. Government customers. On VIGORIDE 6, which was launched in April 2023 and is ongoing, we have deployed all customer satellites, including the Ravella payload for ArcaDynamics, the Vireo CubeSat for C3S LLC, The DISCO-one CubeSat for our house university and the Iris C payload for an Asian customer booked through ISO launch. The culmination of the VIGRIDE 6 commercial deployments contributed to momentous recognizing revenue of $1,700,000 in the 2nd quarter.

Speaker 2

This is a significant milestone in our progress as a company and makes Q2 our first $1,000,000 quarter. During the Vigride 6 mission, momentous also deployed 2 cubesats into low earth orbit as part of the NASA lighted LLITE or low latitude ionospherethermosphere enhancements in density mission. These 2 CubeSats housed behind single deployer door were released from the VIGORIDE OSV earlier than scheduled. While the CubeSats were deployed at the intended altitude of 4 95 kilometers, they were deployed at a different inclination than the intended target orbit needed for the science experiment. NASA has confirmed the 2 CubeSats are functional and the team will be able to operate the science instruments aboard.

Speaker 2

Momentous conducted a thorough investigation and identified the root cause as human error in the mapping of the software command. The company has implemented corrective actions to prevent a recurrence. BigRide 6 remains in good health and the team is working towards some of our mission Milestones like our solar array demonstration, which I'll speak about in more detail later in the presentation. We are proud of the performance of our VIGOR IDE vehicle and see multiple use cases for it, particularly in support of more complex missions. We also have many customers whose mission requirements don't require the pedigree of Avigaride.

Speaker 2

In those cases, we will use another mechanism like a deployer to deliver our customers to their intended orbits. This approach serves the needs of our customers who don't require Delta V and further improves the economics of VIGORIDE. For example, our next mission is planned for launch on the SpaceX Transporter 9 mission targeted for no earlier than November 2023 to low earth orbit. Rather than using a VigRide OSV on this mission, we are carrying our customers on a deployer. The payloads we are flying on the November mission include a satellite from SAT REB in Poland called the AMAN-1 Earth Observation Satellite.

Speaker 2

Satellite can be used for services such as land survey, precision health, agriculture and data for weather, environmental and smart cities applications. The JinjuSat-1 satellite will be deployed for ConTech Company of the Republic of Korea. Once in orbit, Cameras mounted on the satellite will carry out a mission to take pictures of the earth. The Toccadcho satellite will be deployed for Lunasant, A U. S.

Speaker 2

Subsurface imaging company with the goal of making underground resources like water and minerals easier to find. The Picacho CubeSat is a technology demonstration of LUNISAN sensors. It will measure the power spectral density of Low frequency radio signals in the ionosphere which will help inform designs for the company's future satellites. Moving into next year, we do aim to fly our next Vigrai vehicle on the SpaceX Transporter-ten mission targeted for launch no earlier than February 2024. On this mission, we will carry satellites that require orbital delivery services as well as hosted payloads for commercial customers.

Speaker 2

We also plan to carry a momentous hosted payload that we will use to conduct and rendezvous proximity operations demonstration. I am also pleased to see the operational progress that our talented engineering and operations Team continues to make an increasing productivity, improving quality and lowering unit costs. For example, VigorIde 6 assembly integration and test was 36% faster than VigorIde 5 with a 51% decline in nonconformances. With VIGORIDE 7, we plan for a fuller load of payloads and better mission economics and we anticipate that VIGORIDE 7 will generate more revenue than VIGORIDE 6. Turning to slide 7.

Speaker 2

As I mentioned earlier, we've Our product offerings to include low cost, flexible and powerful satellite buses. We are We used to have recently announced our M1000 satellite bus, which is well positioned for a large and growing market. For example, Allied Market Research reports that the global satellite bus market is valued at $11,900,000,000 in 2020 and is projected to reach $20,800,000,000 by 2,030. The M1000 satellite bus is based on our space proven VIGRIDE OSV, its core technologies are the same as VIGORI and the newly branded M1000 satellite bus is tailored and enhanced as needed to meet the mission requirements of different customers in both the U. S.

Speaker 2

Government such as the Defense Department as well as for commercial customers. Our M1000 bus has attributes that we expect to make it highly competitive in the market. It has high power, Flexible configuration to support individual customer needs, can carry more payload than competing buses and can be produced to meet customer needs rapidly, all at low cost. Turning to Slide 8, according to the Space Foundation, which released its annual space report on July 25, The global space economy grew by 8% in 2022 to $546,000,000,000 Of note, Space Foundation also estimates the total space spending by the U. S.

Speaker 2

Defense Department, both classified and unclassified spending for all military branches Intelligence agencies grew to $42,900,000,000 in 2022, a 21% year over year increase. The M1000 satellite bus is well positioned for these growing attractive markets and we're starting to see some traction. We were recently awarded a small business innovation research contract from the U. S. Defense Department Space Development Agency or SBA.

Speaker 2

And I'm pleased to share we have signed the contract for that work. The first contract action is worth roughly $746,000 and includes an option for a contract modification at a later date to add an additional $1,196,000 that we expect the SDA to exercise that will bring the total contract value to over $1,900,000 The scope of this project involves making tailored modifications to the system underlying the M1000 satellite bus and VigorEye Orbital Service Vehicle, So that is even better positioned to be used for SBA's future needs. Last month, we also submitted a bid to the SBA for Tranche 2 Transport Layer Alpha program that involves building 50 satellites. These 50 Satellites will be part of a global constellation of communication satellites supporting the needs of the U. S.

Speaker 2

Defense Department and military services. As a reference point, awards made by SDA for TRONCH-1 of the transport layer satellites were about $700,000,000 to Lockheed Martin, $692,000,000 to Northrop Grumman and $382,000,000 to York Space Systems for a slightly smaller number of 42 satellites, which gives you a rough sense of the size of the contracts expected under tranche 2. For our proposal for the tranche 2 transport layer alpha program, Momentous is the prime contractor on this effort and we've pulled together a team of traditional and non traditional defense contractors that we are confident can deliver for the SDA. We believe we are well positioned for this project due to the differentiated capabilities, Low cost and strong team we have put forward to the SDA. This proposal is now under evaluation by SDA And we expect that agency to make contract awards in late September or early October to 2 teams to build 50 satellites each.

Speaker 2

We've also included our M1000 bus as the featured product in other proposals that are undergoing reviews by both government and commercial customers. In addition to the M1000, we're continuing to offer orbital delivery and hosted payload services. Momentous submitted a proposal to the Defense Innovation Unit or DIU for novel approaches to operationally responsive space. This project requires precise point to point delivery of cargo in a cost effective manner at scale, a need for which our capabilities and technology are well suited. Therefore, we are optimistic about our chances of winning this bid as momentus' value proposition lies right in

Speaker 3

the sweet spot.

Speaker 2

The DIU has indicated they will make a contract award within 60 to 90 days, So we're currently awaiting notification. Momentous has signed a contract with Fossa Systems to provide hosted payload services starting in 2024. Momentous provided orbital delivery services to Fossa on the inaugural mission of Vigorite in 2022 and most recently provided mission management and integration support for the launch of the Fossa Ferrox 1 satellite in June 2023. We are pleased that Fossa has selected momentous again to support its growing needs and innovation that they are bringing to the market. They are a valued repeat customer.

Speaker 2

Commercial and government customers have shared very positive feedback about our capabilities and competitive pricing. This gives us confidence that we're well positioned to succeed in this market. Turning to Slide 9, The anticipated demand for our services is only expected to increase, especially as we're seeing heightened government and DoD interest. In addition, as we pivot towards expanding to the large and mature satellite bus market and continue to pursue launch aggregation as a potential revenue stream, We are taking steps to ensure our launch schedule is optimized to meet this anticipated demand. Momentous differentiates itself by reserving space on SpaceX launch vehicles used for rideshare transportation missions that we then make available to customers.

Speaker 2

Other companies will take your reservation and then try to find a spot for your payload in a rapidly crowding launch manifest introducing significant schedule risk to customers. We've already got space dedicated and we're ready to help customers make the most of it. First, we will be flying on the SpaceX Transporter 9 mission targeted for no earlier than November 2023 to low earth orbit. Momentous has also reserved ports on all the SpaceX transport missions through the end of 2024 including transporter 10 targeted for February 2024, the Transporter 11 mission targeted for June 2024 and the Transporter 12 mission targeted for October of 2024. Turning to slide 10, The market opportunity for momentous is substantial and experiencing strong growth.

Speaker 2

For example, as I mentioned, the Space Foundation's annual space report released last month shows that in 2022 the global space economy grew 8% reaching $546,000,000,000 The commercial space market climbed nearly 8% reaching over $427,000,000,000 and the U. S. Government spent $69,900,000,000 on space programs with the majority coming from the Department of Defense. We are pleased about the interest and our capabilities from U. S.

Speaker 2

Government customers responsible for national security missions. The flexibility, payload capacity and power available in the Viguoride Orbital Service Vehicle and M1000 satellite bus make them well positioned to support a range of national security missions like space situational awareness, surveillance, reconnaissance and other missions. The BigRide Orbital Service Vehicle can also deliver national security payloads to custom orbits to support their unique mission requirements. The speed with which we can move from initial customer requirements to operation in space is a major discriminator that sets us apart from traditional companies that support Defense Department missions. Having large amounts of power available support intensive high end national security payloads like sensors, communications equipment and other electronics also distinguishes momentous from our competitors.

Speaker 2

Coupled with the ability to change orbital altitude and inclination, Our capabilities are well suited to support the kind of maneuver in space that senior U. S. Officials like Space Force Chief of Staff, General Salzman have discussed as a key need in the highly contested space environment. In addition, momentous has a highly Aireon's team of professionals and engineers with decades of national security experience that gives us an edge over other U. S.

Speaker 2

Companies and also over international competitors who are unable to meet the needs of these large Defense Department customers. New regulations are also playing a role in expanding the opportunity for momentous. For instance, Last year, the FCC or Federal Communications Commission adopted a rule that will require satellite to remove their satellites from low earth orbit within 5 years following mission conclusion. With the number of satellite deployments growing rapidly, The problem debris in space is accelerating rapidly. The rule from the FCC acknowledges the And we expect will create significant customer demand for satellite de orbiting services.

Speaker 2

NASA and the U. S. Defense Department I've also been letting contracts for studies and demonstration missions for work on addressing the problem of growing orbital debris. Satellite view orbiting is a complex mission, but I'm proud to say that momentous anticipated a more active stance on debris removal from regulators and has been investing in developing this capability for several years. We think our early investments in upcoming technology demonstrations provide us with a competitive advantage over others.

Speaker 2

If you consider that roughly 2,500 satellites were placed in orbit last year and that annual deployments are forecasted to roughly triple by 2028 according to Deutsche Bank, it's not hard to envision a scenario in which thousands of Turning to Slide 11. Momentous is well positioned to grow in the space market, thanks to our value proposition with differentiated capabilities. We have now delivered 15 satellites to orbit in our history while demonstrating the maturity and operational capabilities of our technology Along with its functionality in space, we are continuing to develop new differentiated technology and are expanding our product offerings to the large mature satellite bus market and to the expanding space servicing and de orbit markets. We're working to develop additional features and capabilities for our VigorIde and M1000 bus performance such as a high speed mission data link, adding expansion tanks, incorporating security features and adding a precision pointing to host sensitive and classified U. S.

Speaker 2

Government payloads. We expect to begin introducing some of these features in 2024. A great example of our innovation is our Tape Spring Solar Array or TASSA, T A SSA, which has been in space since April on our VIGORITE-six mission. We expect to soon unfurl and demonstrate this technology in the coming weeks. Our team led by Chief Technology Officer, Rob Schwartz has been working on the TASA construct for several years as a potential means of reducing BigRide unit manufacturing costs and lead times.

Speaker 2

The Tassa array is about 11 meters or 36 feet long. To build Tassa, the team bonded large sheets of flexible solar cells to tape springs. Its concave shape provides its structural strength. It's very similar to the rollout tape measures you can buy from places like Home Depot. They keep their stiffness and strength due to their shape only on a much larger scale.

Speaker 2

The 4 inches mandrel is much smaller than those used in competing rollout solar arrays providing weight savings. Once development is complete, we estimate that replacing Viguride's 3rd party solar array with Tassa could reduce the overall recurring production cost of Viguiron by as

Speaker 4

much as

Speaker 2

10%, while potentially reducing lead times by several months. We've applied the patent to technology behind Tasset and we're seeing interest from commercial and government customers given the efficiency we expect to demonstrate for low cost power in space. Finally, our Rendezvous and Proximity Operations or RPO technology demonstration is planned for our Vigoride 7 mission, which is scheduled to be launched on the SpaceX Transporter 10 mission in February 2024. RPO capability is key to our ability to expand the menu life. The RPO mission also supports another innovation focus of ours, which is to evolve towards a reusable version of or a refuelable version that would stay in space and be refueled and therefore reused on later missions.

Speaker 2

Currently after completing its mission, Vigoride will move to a lower degrading orbit and safely and responsibly burn up during reentry. A reusable VIGORIDE after completing its mission will rendezvous with and provide services to additional customer satellites, thereby providing greater return on investment for each VIGORI launched. Turning to Slide 12. In summary, momentous is well positioned for the future. We have a favorable demand outlook, demonstrated competitive advantages, attractiveness for growing U.

Speaker 2

S. Government and Defense Department programs and significant potential for margin improvement. In a moment, our CFO, Eric Williams will walk us through the financials. But before he does that, I'll comment briefly on where we've come from and where we stand on our journey. It is clear that we face some headwinds in the recent risk off environment in the market and seen our stock price reflect that.

Speaker 2

Clearly, we would have liked for the market to have given greater value to the achievements that have put us in position to achieve becoming a public company just over 2 years ago. In August of 2021, our relationship with the Defense Department was not good to put it charitably and some in the market did not believe we would be able to repair it. That is most clearly not the case day as indicated by our recent contract award from the Defense Department's Space Development Agency and its positive comments to us about our capabilities. In August of 2021, we had yet to test our microwave electro thermal thruster on the VigRite orbital service vehicle in space And some doubted we ever would. Today, we have tested it successfully in space on Viguorite and not once or twice, but dozens of times in space, the ultimate test.

Speaker 2

In August of 2021, we hadn't begun to contemplate the ability to expand into the satellite bus market. Today, we have what is arguably the best value smallsat bus available based on comments by Defense Department officials to us and we have recently submitted a major proposal to join the Defense Department's proliferated low earth orbit satellite constellation. In August of 2021, we had a young workforce. Today, this workforce, the foundation of our company's value, has matured to the point of having put 3 VigorEye Orbital Service Vehicles in space, deployed 15 customer satellites and is at this very moment managing and controlling 2 of our Vigorides simultaneously in orbit. During our launch campaigns for the 3 VIGRIDE missions, when I'm here late at night and on weekends, I've been invigorated by Walking around and seeing the passion of our employees hard at work despite the day or hour.

Speaker 2

I'm tremendously proud and could not be more appreciative of every single momentous employee and we're working hard to retain them. Momentous is pushing ahead on our growth path. We are competing vigorously in the defense, government and commercial markets. We have several promising near term opportunities in our sweet spot. We are actively seeking new investors while considering a full range of strategic options, which is why we engaged Deutsche Bank recently.

Speaker 2

And we are continuing to drive our technology forward in concert with the demand signal we are getting from customers. With that, I'll turn the microphone over to our CFO, Eric Williams.

Speaker 4

Thank you, John for the introduction. I am pleased to present highlights of the financial results achieved by the momentous team during our Q2 of 2023. Turning to Slide 14. Our 2nd quarter results reflect our ongoing progress and investments towards our future launches. We have cumulatively signed contracts for approximately $32,000,000 in backlog or potential revenue as of July 31, 2023.

Speaker 4

These contracts include firm orders as well as option. These options give our customers the flexibility to quickly opt into an available launch slot on short notice without requiring a separate agreement. The breadth of these signed contracts spans across 18 companies and 14 countries. Typically, our customers have the right to cancel a flight reservation and when doing so, will forego their deposits and milestone payments. Should a customer cancel a contract for their rescheduling needs or other reasons before all of its statements are made, the resulting revenue will be less than the full value of Momentum has historically included in backlog both firm orders as well as option.

Speaker 4

These options give our customers the flexibility to opt into an available launch slot without requiring a separate agreement. We ended Q2 2023 with unrestricted Cash and cash equivalents of $21,300,000 and approximately $9,000,000 in outstanding gross debt consisting of a term loan that we began to repay in March of 2022. Next, I would like to address a topic that will be mentioned in our 10 Q to be filed with the Our 10 Q will include language evaluating whether there are conditions and events that raise substantial doubt about our ability to continue as a going Sure. This gun concern determination was concluded as we prepared our financial statements for the after management conducted a comprehensive evaluation of the status of our current liquidity and projected cash flows for the next 12 months. When taking into account certain external factors, this analysis concluded that given our current cash balance, the company is unable to meet its obligations for the next 12 months.

Speaker 4

Although the company has a history of successfully raising cash primarily through the issuance of equity, Consistent with the relevant technical guidance, any projected or anticipated equity financing transactions are not generally viewed as probable for the purposes of going concern assessment. Momentus has taken and continues to take several proactive steps with respect to managing our burn rate and extending our cash runway while we continue exploring new business opportunities and working to raise additional capital. Towards the end of Q2 of 2023, we reduced our headcount consisting of both full time employees and contractors by approximately 30% to substantially reduce our burn rate while retaining the talent we need to execute in our key near term initiatives. We expect to realize the full impact of those cost reductions during Q3 of 2023. In addition, the company has been working to raise additional while pursuing and evaluating strategic alternatives.

Speaker 4

To that end, the company engaged Deutsche Bank as a financial advisor. We invested approximately $14,600,000 in operations during Q2 compared to 18 point $7,000,000 in Q1 2023 $22,900,000 in Q2 2022. We recognized $1,700,000 in revenue in Q2 as a result of meeting a variety of customer service milestones associated with our BigRite 5 and VIGRIDE 6 launches. In the quarter, we generated approximately $18,900,000 in losses from operations compared to 23 Adjusted EBITDA was negative $14,400,000 for Q2 2023, a sequential improvement of approximately 1 $400,000 from Q1 of 2023 $3,800,000 better as compared to Q2 of 2022. Non GAAP SG and A expenses for the Q2 of 2023 totaled $6,400,000 an improvement of $1,800,000 as compared to Q2 of 2022.

Speaker 4

Non GAAP R and D expenses for the Q2 of 2023 totaled approximately $9,500,000 is down $900,000 from Q2 of 2022. We ended Q2 2023 with approximately 95,000,000 shares Sandy. In addition, we have filed proxy materials that are scheduled to have a shareholders meeting on August 22 to approve a reverse split of our stock. We expect this to allow us to continue to meet the NASDAQ listing requirements and aid in future capital raising. Please refer to the press release issued today for the reconciliation of non GAAP numbers to GAAP.

Speaker 4

I will now hand the call back to Mary.

Speaker 1

Thank you, Eric. In a moment, we will move on to the question and answer portion of our call. I would like to remind participants that all disclaimers outlined at the outset of this call extend to the question and answer session. This concludes our disclaimers relating to non GAAP financial information, forward looking statements and the technology underlying our planned service offerings. Operator, would you please remind participants of the entry of the queue?

Operator

Thank you, Ms. We'll go first this afternoon to Michael Matheson at Singular Research.

Speaker 3

Good afternoon, everyone. Congratulations on all that revenue.

Speaker 4

Thanks, Mike. Appreciate it.

Speaker 3

Just kind of looking into the dynamic of the going concern issue versus revenue versus the burn rate. I'm sure that's an equation you sit there solving every afternoon. If I'm sort of following it, it looks like you booked all the revenue that was available from the Vigoride 5 and 6 missions having deployed all the satellites. Looks to me like the next revenue opportunity would be the November mission. Is that fair?

Speaker 4

We have not totally finished recognizing revenue on V5, but we have completed revenue associated with V6. We do have some residual revenue to be recognized relating to In support of the Caltech mission, which we're hosting currently still hosting. Our next and as you know, that next revenue event would be the Transporter 9 mission in around the October timeframe, October November.

Speaker 3

And just following up on that mission, is all the capacity booked for that launch and how many deployments would full capacity represent?

Speaker 2

In November, it's John Rood, Michael. Thank you for the question. In November, we will launch at least 3 satellites mentioned and potentially one additional one that we're working with the customer on. The 3 satellites would be from SAT Rev in Poland, Also one from called JinjuSat, one from ConTek in South Korea And a third one from LUNISAND, which is a U. S.-based company.

Speaker 2

And then as I say, it's there's a potential for a 4th satellite, but that Thank you, Michael.

Operator

Thank you. And nothing coming in at this time, but we'll give them one more opportunity to ask any questions. We'll take a follow-up question from Michael Matheson.

Speaker 3

Thanks you guys. It looks like the way was clear for me to ask a follow-up. So again, just sort of solving that The equation of burn rate versus the cash on hand, you mentioned that you've taken a lot of steps to reduce the burn rate. Would you feel comfortable giving us any kind of a figure to work with or just lower as far as you wanted to go?

Speaker 4

I'd say lower is probably about as far as we're going to go. I think if you wanted to think about the subsequent quarter, definitely lower than our past Right. We did that 30% reduction in headcount. And through the financials, you can get a sense that it wouldn't be a full 30% The Board with respect to cash on the quarter, but you can view it as we're pushing on it fairly hard to be able to get as much runway as we can out of that.

Speaker 3

Yes, exactly. Okay. Well, thank you again for the information.

Speaker 2

Thanks, Michael.

Operator

Thank you. And gentlemen, it appears we have no further questions this afternoon. So that will bring us to the conclusion of the moment this 2nd quarter earnings call. We'd like to thank you all so much for joining us today and wish you all a great evening.

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Key Takeaways

  • In Q2 2023, Momentus achieved its first $1.7 million revenue quarter, driven by customer satellite deployments on the VigRite 5 and 6 missions and ongoing hosted payload support for Caltech’s Space Solar Power Demonstrator.
  • The company successfully demonstrated its microwave electrothermal thruster (MET) using water propellant with 35 in-space firings and a 3 km altitude raise, marking a milestone for its environmentally friendly propulsion technology.
  • Momentus launched three Orbital Service Vehicles in under a year, deployed 15 customer satellites, introduced the M1000 satellite bus based on flight-proven technology, and secured rideshare slots on SpaceX Transporter missions through late 2024.
  • Backlog of approximately $32 million spans 18 companies in 14 countries, including a $746,000 SBIR contract with the Space Development Agency and proposals for the SDA’s Transport Layer Alpha program and DIU responsive launch services.
  • As of July 31, 2023, the company held $21.3 million in cash against $9 million of debt, flagged a going concern due to operating losses, and implemented a 30% headcount reduction while pursuing additional capital and strategic alternatives.
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Earnings Conference Call
Momentus Q2 2023
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