AST SpaceMobile (ASTS) Q4 2025 Earnings Transcript

Image source: The Motley Fool.

DATE

Monday, March 2, 2026 at 5 p.m. ET

CALL PARTICIPANTS

• Chairman and Chief Executive Officer — Abel Avellan
• Chief Strategy Officer — Scott Wisniewski
• Chief Financial Officer — Andrew Martin Johnson

Need a quote from a Motley Fool analyst? Email pr@fool.com

TAKEAWAYS

• Full-Year Revenue -- $70.9 million reported, at the top end of the $50 million to $75 million guidance range, driven by commercial gateway deliveries, government contract milestones, and consulting services.
• Q4 Revenue -- $54.3 million, primarily from gateway hardware sales, U.S. government service milestone achievements, and consulting services to a mobile network operator partner.
• 2026 Revenue Outlook -- Expected range of $150 million to $200 million, with half already contracted and additional potential from further government and commercial deals, and initial commercial service revenue.
• Contracted Backlog -- Over $1.2 billion in minimum committed revenue from commercial partners, supported by prepayments and long-term agreements, including a $175 million prepayment from STC Group.
• Q4 Adjusted Operating Expenses -- $95.7 million non-GAAP, up from $67.7 million in Q3, mainly due to a $23.4 million increase in cost of revenues related to gateway deliveries; excluding cost of revenues, $66.8 million in Q4 versus $62.2 million in Q3.
• Full-Year Adjusted Operating Expenses (Ex-Cost of Revenue) -- $224.8 million, up from $151.8 million in 2024, driven by workforce expansion, manufacturing facilities, and professional fees for spectrum and financing.
• 2025 Capital Expenditures -- Approximately $407 million, exceeding the previous quarterly guidance of $275 million to $325 million, attributed to satellite material pre-purchases and launch contract timing.
• 2026 Capital Expenditure Guidance -- Projected at $350 million to $425 million, focused on launch payments and satellite-related spending.
• Liquidity -- $3.9 billion of cash, cash equivalents, restricted cash, and available ATM liquidity as of December 31, 2025, boosted by $2.2 billion convertible note proceeds and $76 million from ATM facilities in Q4, with no plans for further convertible note offerings.
• Satellite Deployment Goals for 2026 -- Aiming for 45 satellites in orbit and 60 ready to ship by year-end, enabled by batch launches of three to eight satellites using New Glenn and other launch vehicles; 12 additional launches contracted.
• Manufacturing Capacity -- Production ramped to support six satellites per month, with Block 2 BlueBird assembly targeting completion of 40 Micron cores by mid-year; expanded manufacturing facilities in Midland, Texas, and Homestead, Florida, totaling over half a million square feet worldwide.
• Block 2 BlueBird Program -- Block 2 satellites offer a 3.5-times size and tenfold capacity increase over Blocks 1–5, with ~2,400 square feet per unit and future launches in stacked configurations starting after BlueBird 7.
• Proprietary Technology and IP Portfolio -- Over 3,100 patent and patent-pending claims; technology enables 4G, 5G, and future 6G direct-to-device broadband with digital beamforming, multi-carrier aggregation, and capacity for up to 120 Mbps on Block 1 satellites, with significant improvement in Block 2.
• Spectrum Assets -- Access to 1,150 MHz of tunable MNO spectrum globally, including 45 MHz of MSS lower mid-band in North America and 60 MHz of licensed S-band rights outside North America; additional spectrum via partner networks for multi-band flexibility.
• Key Commercial Agreements -- Definitive deals signed in 2025 with Verizon (US), STC Group (Saudi Arabia), and additional partnerships announced with Orange, Telefónica, CK Hutchison, and Taiwan Mobile.
• Government Revenue and U.S. National Security -- Ten contracts executed in 2025, including the U.S. Space Development Agency’s $30 million award for the EUROPA Tranche 2 program and Missile Defense Agency's SHIELD IDIQ, positioning the company as a prime contractor for U.S. defense agencies.
• Profitability and Operating Leverage -- Company projects "flow-through margins and our operating leverage we think, over time, could contribute to an EBITDA margin in the 90% area or higher," with high service gross margins already observed.
• Convertible Notes and Debt Actions -- February 2026 $1+ billion convertible note proceeds designated for spectrum acceleration, AI commercialization, U.S. government initiatives, and selective debt reduction; $457 million of January 2025 convertible notes and $250 million of July 2025 notes converted into equity.
• 2026 Revenue Doubling Expectation -- Management expects "revenue to at least double versus 2025," citing pipeline de-risking, contractual milestones, and government awards.

SUMMARY

AST SpaceMobile (NASDAQ:ASTS) transitioned from pre-revenue to a commercial-stage company in 2025, reporting $70.9 million in full-year revenue and securing over $1.2 billion in minimum committed revenue from commercial contracts. Record capital raises increased liquidity to $3.9 billion, supporting the acceleration of satellite deployment, manufacturing expansion, and technology investments. The company detailed a plan to deploy 45 satellites in orbit and have 60 ready to ship by year-end 2026, enabled by multi-satellite batch launches and ramped production capacity. Management expects full-year 2026 revenue of $150 million to $200 million, as commercial service activation and additional government milestones increase contracted revenue. New government awards, large-scale commercial agreements, and technological advancements in spectrum utilization and phased array design position AST SpaceMobile for robust multi-year revenue growth and high operating leverage.

• The company stated about half of its 2026 commercial pipeline is already booked or contracted, with the remaining composed of advanced-stage and expected new deals.
• The $1.2 billion contracted backlog includes a mix of prepayments and long-term commitments, yet annual revenue from backlog will account for only a minority of the $1 billion 2027 revenue goal.
• Satellite stacking capability, completed in early 2026, is expected to significantly improve launch cadence, supporting the stated deployment schedule and scaling operational execution.
• Integration of a novel ASIC chip into Block 2 BlueBird satellites in 2026 is anticipated to enable 10 gigahertz processing bandwidth per unit, exceeding prior orbital throughput records.
• Current government contract revenue does not depend on full constellation deployment, but management identified government applications as scalable by satellite count and a reliable early revenue source.
• Proceeds from recent convertible note offerings will be used for spectrum deployment, AI-related opportunities, U.S. government market initiatives, and targeted debt reduction, with no further convertible issuance planned.
• Non-cash spectrum licensing costs are capitalized and will only be included in operating expenses once monetization begins and regulatory approvals are received.

INDUSTRY GLOSSARY

• BlueBird Satellite: AST SpaceMobile’s proprietary large phased-array spacecraft forming the core of its commercial space-based cellular broadband constellation.
• Micron: The core modular building block of AST SpaceMobile’s phased-array satellite, referenced as a standardized production element.
• MNO: Mobile Network Operator; telecom carriers partnering for SpaceMobile service integration.
• ASIC (Application-Specific Integrated Circuit): Custom chip designed in-house to enhance onboard satellite processing and expand broadband capabilities.
• EUROPA Tranche 2: U.S. Space Development Agency program for commercial solutions, including AST SpaceMobile’s $30 million satellite communications contract.
• SHIELD: U.S. Missile Defense Agency’s contract framework for satellite-enabled national security applications, with AST SpaceMobile as an awarded IDIQ contractor.
• D2D (Direct-to-Device): Service model enabling broadband connectivity directly to unmodified consumer mobile devices via AST SpaceMobile’s space-based network.
• Golden Dome: U.S. government national security initiative leveraging satellite communications, referenced among awarded contracts.

Full Conference Call Transcript

For those of you who may be new to our company and mission, there are nearly 6 billion mobile phones in use today around the world, but many of us still experience gaps in coverage as we live, work, and travel. Additionally, there are billions of people without cellular broadband, and who remain unconnected to the global economy. The markets we are pursuing at AST SpaceMobile, Inc. are massive. And the problem we are solving is important and touches nearly all of us. In this backdrop, AST SpaceMobile, Inc. is building the first and only global cellular broadband network in space to operate directly with everyday, unmodified mobile devices, supported by our extensive IP and patent portfolio.

It is now my pleasure to pass this over to Chairman and CEO, Abel Avellan, who will go through our activities since our last public update.

Abel Avellan: Thank you, Scott. For the first time in 2025, AST SpaceMobile, Inc. became a revenue-generating business as it significantly advanced all key aspects of our operations, including commercial, government, manufacturing, spectrum rights, IP portfolio, and capital position. The combination of these efforts resulted in the successful launch and unfolding of our next-generation BlueBird satellite, BlueBird 6, the largest ever commercial communication array deployed in low Earth orbit, to enable the first and only global space cellular broadband network for government and commercial customers. On the financial front, during 2025, we raised over $3.5 billion in capital and reported revenue of over $70 million for the full year and signed over $1 billion of minimum committed revenue.

Operationally, we plan to ramp our satellite manufacturing efforts and launch cadence this year while we are rapidly accelerating our government and commercial businesses. We entered 2026 with strong momentum and a clear vision as we lead the space-based cellular broadband industry, a market that we invented. 2026 will be the year we scale our space-based direct-to-device constellation from initial commercial activation to start of commercial service with mobile network operator partners in key markets like the United States, Europe, Japan, Saudi Arabia, and other key strategic markets, including the U.S. government.

In just over one year since the orbital launch of our first five Block 1 BlueBird satellites, we developed our Block 2 BlueBird program, which is roughly 3.5 times larger and 10 times the capacity of BlueBird 1–5, breaking our previous record on both size and capabilities, and then scaled, tested, launched, and successfully unfolded BlueBird 6, our next-generation satellite of approximately 2,400 square feet. BlueBird 7, identical to BlueBird 6, is encapsulated and ready to launch within the next New Glenn launch vehicle at Cape Canaveral and is awaiting orbital launch, which is expected in March.

Our upcoming launch advances our deployment goals aboard New Glenn and will feature a 7-meter fairing enabling twice the payload volume of the 5-meter class commercial launch vehicles, to support up to eight of our largest ever Block 2 BlueBird satellites. We expect to fully utilize New Glenn fairing capacity as we progress through our orbital launch plans. We are especially excited to share this milestone with many of you who we hope will join us in Florida during our next launch. Looking ahead, we are expecting 2026 to be a very active year, particularly as we progress into the second half.

We remain on track to achieve our target of deploying 45 to 60 satellites into low Earth orbit by the end of this year, with current expectations closer to 60 satellites ready to ship and 45 satellites in orbit. We continue to expect launches planned every one to two months on average, starting with our first New Glenn launch expected in March. The New Glenn launch vehicle is completing final readiness for our fully encapsulated satellite, which was handed off on February 18. Importantly, this launch will be the first New Glenn launch to use a previously flown first stage.

To support our launch cadence during 2026, we expect the New Glenn booster to be reused every 30 days or less after our ongoing launch. Our launch plans include a total of 12 additional contracted launches across several launch vehicles. Lastly, we also recently signed an additional agreement to integrate our satellites with a new heavy launch vehicle to be on standby in their manifest. We are laser-focused and working tirelessly on delivering our Micron phased arrays and full satellite production goals. On the manufacturing front, we continue to ramp our operations to support up to six satellites per month.

We exited 2025 having reached a production capacity worth of Micron and phased array per month, and we expect to achieve a testing, assembly, and integration cadence of six satellites per month in 2026. BlueBird 8 to 29 are in various stages of production, and we are scheduled to complete assembly of 40 satellites’ equivalent of Micron during 2026, bringing us to BlueBird 46. A detailed cadence of our 2025 and 2026 deployment plan is shown in the company quarterly presentation found on our IR website. After BlueBird 7, our satellites will support a stackable configuration of three, four, six, and eight satellites per launch, which allows us to meet our 2026 deployment goals.

Additionally, we anticipate our novel ASIC chip will be integrated into our Block 2 BlueBird satellite during 2026 to support 10 gigahertz of processing bandwidth per satellite, which will enable us to exceed the capabilities of up to 120 megabits per second on our in-orbit Block 1 BlueBird satellites. These data rates are high enough to achieve the native cellular capability that consumers now expect everywhere, from areas not served or not served well enough by terrestrial connectivity. Another key enabler is producing the largest ever commercial communications array at scale with our 95% vertically integrated manufacturing strategy.

Over the past several months, we have expanded our manufacturing sites both in Midland, Texas and Homestead, Florida, including acquiring a fourth site in Midland for dedicated Micron production, the building block of our satellites. We will soon be over half a million square feet of operational space globally, providing us with greater manufacturing and work capabilities with tighter control over the manufacturing process from end to end. This rigorous effort, strengthened by our skilled workforce, enables us to proactively manage nearly every step in the process, including securing long-lead materials well in advance of satellite assembly, while keeping our materials and components costs low.

Simply put, we are the first company in the history of commercial satellite manufacturing to produce satellites of our size, scope, and power at scale. Together, our key technology differentiation in the size of our satellite, spectrum availability, and custom ASIC that supports today’s capability to deliver cellular from space is supported by our extensive portfolio of over 3,100 patent and patent-pending claims. 2026 is the year we scale commercial operations. We are the only company capable of delivering 4G and 5G, and in the future 6G, broadband speeds sufficient for voice calls, Voice over LTE, live video calls, streaming, and full Internet access directly to unmodified devices.

Our technology is anchored by our ability to manufacture the largest commercial communications array ever placed into low Earth orbit, creating a durable technology advantage. Our satellites enable digital beamforming and are capable of multi-carrier aggregation in multiple frequencies, supporting simultaneous users per beam, behaving like a terrestrial cell tower from space, when combined with our integrated ground-space gateway architecture and growing commercial ecosystem with over 50 leading global mobile network operator partners who collectively cover nearly 3 billion subscribers. As Scott will discuss in more detail, we continue to expand our commercial ecosystem.

In 2025, we entered into definitive commercial agreements with Verizon in the United States and STC Group in Saudi Arabia and other key markets across the Middle East and Africa. As part of our 10-year agreement with STC Group, we will receive a prepayment of $175 million in 2025, indicative of the ambition we both share in bridging connectivity gaps and delivering cellular broadband directly to devices. Recently, we announced partnerships with Orange, Telefónica, CK Hutchison, Taiwan Mobile, and progress in initiatives with Vodafone to bring our direct-to-device cellular broadband service to their markets, who are now part of our commercial ecosystem with over 50 leading global mobile network operator partners who collectively cover nearly 3 billion subscribers.

To date, our commercial advancement has positioned us to secure over $1 billion in total contracted revenue commitments from our commercial partners. As a reminder, our comprehensive spectrum strategy is defined by our access to approximately 1,150 megahertz of low-band and mid-band tunable MNO spectrum globally, which includes 45 megahertz of MSS lower mid-band spectrum in North America and 60 megahertz of licensed S-band spectrum priority rights outside North America. Our low-band spectrum strategy is centered around the use of premium multi-operator 850 megahertz cellular spectrum. We have important characteristics like longer reach, better penetration, and compatibility with existing 3GPP standards and devices.

We have further strengthened this advantage through strategic MSS and cellular spectrum, including both premium low-band, mid-band, L-band, and S-band spectrum priority rights, positioning us to reliably deliver cellular broadband service at a global scale. We also made significant progress in our government business as our satellite technology continued to be used by the United States government for dual-use and dedicated applications. National security is a key priority for the United States. We continue to see willingness to rapidly adopt innovative, forward-looking technologies like ours.

Taken together, these accomplishments and the competitive advantage we have built give us significant momentum as we progress through 2026, as the partner of choice for global mobile network operators and a unique non-communications capability provider for the U.S. government. And with that, I will turn the call back to Scott.

Scott Wisniewski: Thank you, Abel. I want to take this time to reflect on our business accomplishments in 2025 and how we see the business evolving over 2026 and 2027. Last year, 2025, was the year we activated our revenue engine, with record revenue of over $70 million, achieving the upper end of our revenue guidance. We are no longer a pre-revenue company. During the year, revenue was primarily driven by commercial gateway deliveries and milestones completed from our government contracts. We delivered 15 commercial gateways to MNO partners in 2025. Importantly, these sales are a leading indicator that our MNO partners are preparing for AST SpaceMobile, Inc. commercial service and making investments ahead of that rollout.

This was also a well-diversified set of initial gateway deliveries across nine different customers across five continents, which starts to paint the picture of our initial commercial markets in the U.S., Canada, Europe, Japan, the Middle East, and Africa. In terms of signing contracts, the major customer deals for 2025 were definitive commercial agreements with Verizon and STC Group, joining AT&T and Vodafone. We continue to see heavy engagement from MNOs, resulting in good progress deepening and growing our partner ecosystem, taking advantage of our base of over 50 global MNOs with nearly 3 billion subscribers.

We and our mobile network partners also recently announced additional specific initiatives with Vodafone, Orange, Telefónica, CK Hutchison, Taiwan Mobile, among others, while formally unveiling Satellite Connect Europe and its leadership team as our European distribution joint venture with Vodafone. In 2026, we expect more MNOs to join the AST SpaceMobile, Inc. network, and we expect to harvest our pipeline for many additional definitive commercial agreements as the contractual relationships mature with our existing partners beyond the investor MNOs. The U.S. government was also a significant contributor to 2025 revenue.

During the year, we executed against our existing 10 contracts across an expanding list of interested agencies, developing and testing additional capabilities using our in-orbit infrastructure, capabilities critical to U.S. national security, including the Golden Dome project. The revenue derived from the U.S. government is not dependent on full constellation deployment but is more scalable by satellite count, which makes it an early, reliable contributor to revenue. As a reminder, the goal of these contracts is to develop capabilities that could grow into programs of record, with billions of annual revenue potential in aggregate for missions incredibly important to U.S. national security.

We also recently announced our status as a prime contractor to the U.S. government and received a $30 million contract award from the United States Space Development Agency for the EUROPA Tranche 2 Commercial Solutions program. This contract focuses on developing immediate, resilient, and low latency tactical satellite communications directly between government end users and devices. The award demonstrates how commercial space innovation can be rapidly integrated into national security missions. The award further validates the dual-use nature of our technology for both commercial and national security applications.

Regarding the Golden Dome project, we continue to execute against our current contract with the Space Development Agency, and we were recently awarded an IDIQ contract under the United States Missile Defense Agency's SHIELD program. These awards position us to compete for a wide range of future activities to support one of the largest and most significant United States defense programs in history. As we turn the page into 2026, we see this year as an inflection point as we enter commercial service with our initial MNO partners, while also continuing to generate revenue from the commercial gateway and government strategies.

Before the impact of commercial service revenue later in the year, we expect revenue to at least double versus 2025. In fact, our 2026 expectations are further de-risked given our contracted pipeline, which provides upside with additional government contract wins. Looking ahead to 2027, with a large-scale constellation in orbit, we see a really, really strong outlook for both commercial and government service revenue. 2027 will be the first full-year impact of commercial service revenue, as the AST SpaceMobile, Inc. cellular broadband service becomes available in some of the best markets worldwide to hundreds of millions of subscribers via a low-friction service offering provided when the subscriber needs it most.

We also expect government revenue to continue to multiply in 2027 with significant upside depending on certain contract outcomes. We see the opportunity in 2027 approaching $1 billion in annual revenue, importantly comprised of revenue both long-term contracted or highly recurring in nature, subject to achievement of commercial and government service objectives. Going into the end of the decade, we see further multiples of revenue upside, driven by greater subscriber uptake and market extension. All told, we are confident that our business strategy has strong competitive differentiation and is supported by a growing list of industry tailwinds. We enter 2026 with the assurance and conviction needed to win in an ever-expanding TAM.

I will now turn the call over to Andrew Martin Johnson for the financial results.

Andrew Martin Johnson: Thanks, Scott, and good afternoon, everyone. During 2025, we continued to execute on our commercial objectives while expanding manufacturing and, importantly, significantly strengthening our financial position to support our core objectives in 2026. 2025 is best described as a year of scaling at AST SpaceMobile, Inc. We began the year focused on building out manufacturing to support our targeted launch schedule through 2026, and we ended the year with the launch of our first Block 2 BlueBird satellite, BB6, a seminal moment in the history of our company.

As we speak with you today, we have 29 Block 2 BlueBird satellites in various states of production and are on target to complete the assembly of 40 satellites’ equivalent of Microns during the first half of 2026. For 2026, AST SpaceMobile, Inc.'s global workforce is intensely focused on completing our Block 2 BlueBird satellites to support the orbital launch of 45 to 60 total satellites during the year as we work towards commercial service activation in the second half. As Scott described, our focus on launch cadence and commercial service activation in 2026 is complemented by our increasing revenue opportunities, both from commercial and U.S. government partners.

We are now a revenue-generating company, and we will work hard to achieve profitability from our growing revenue initiatives that are intrinsically linked to the increasing number of Block 2 BlueBird satellites that we put into low Earth orbit. Our rapid growth is supported by a fortified balance sheet.

Not only do we now have the cash to support the full build-out and launch of a constellation of over 100 satellites to provide worldwide SpaceMobile service, our most recent financing activities position us to accelerate deployment of our controlled spectrum bands on a global basis, monetize the capabilities of our proprietary technology to capture the evolving commercial opportunities related to artificial intelligence, enhance investment in government space opportunities in the United States, reduce our higher-interest debt, and pursue opportunistic investments to accelerate our SpaceMobile services and capabilities.

All the while, we continue to balance a prudent approach to our spending while moving quickly to protect and capitalize on our first-mover advantage of bringing space-based broadband connectivity direct to unmodified smartphones in the rapidly growing direct-to-device market. Our intentional focus on investing in operational growth led to higher adjusted operating expenses and capital expenditures in 2025, both consistent with our expectations and previously communicated during our Q3 2025 earnings call. Importantly, our revenue ramp continued in Q4 with significant revenue growth from commercial gateway deliveries, services, and contracted milestones completed for the U.S. government, resulting in 2025 revenue near the top of our guidance range.

Moving to the operating and capital metrics, let us review the key metrics for the fourth quarter and full year of 2025 in more detail. For the fourth quarter, we incurred non-GAAP adjusted operating expenses of $95.7 million versus $67.7 million in the third quarter. As a reminder, non-GAAP adjusted operating expenses exclude non-cash operating costs, including depreciation and amortization and stock-based compensation.

The quarter-over-quarter increase of $28 million resulted primarily from a $23.4 million increase in adjusted cost of revenues related to gateway deliveries, the first revenue from our MNO partners, together with a slight $3.5 million increase in adjusted R&D costs and a $3 million increase in adjusted engineering services costs, partially offset by a $1.9 million decrease in adjusted general and administrative costs. Our Q4 adjusted operating expenses, excluding those adjusted costs of revenue, would be $66.8 million compared to $62.2 million in Q3 2025, which is in line with the mid-$60 million guidance that I previously provided.

For the full year of 2025, non-GAAP adjusted operating expenses, less adjusted costs of revenue, totaled $224.8 million compared to $151.8 million for the full year of 2024. The primary drivers of the increase were growth in our workforce, including contractors and consultants, our expanded production facilities, and other professional fees, including legal fees related to our spectrum and financing transactions. Turning now to our capital expenditures for 2025, capex was approximately $407 million versus approximately $259 million for 2024. This figure was made up primarily of capitalized direct materials and labor for our Block 2 BlueBird satellites and payments made in connection with multiple launch contracts, with the balance relating to facility and production equipment expenditures.

This amount was above the quarterly guidance of $275 million to $325 million that I provided during our last earnings call, mainly due to intentional growth investments to accelerate satellite material purchases and the timing of launch contract payments. For 2026, we estimate that our adjusted operating expenses, excluding cost of revenue, will be in the range of approximately $70 million to $80 million as we add to our workforce and continue to design, manufacture, launch, and operate our growing satellite constellation, as well as pursue the monetization of our L- and S-band spectrum usage rights.

We expect our capital expenditures to remain flat in Q1 2026 with Q4 2025 and to come in at a range of $350 million to $425 million, primarily driven by the timing of launch payments related to our near-term launches, which, as I previously explained, vary from quarter to quarter. We continue to estimate that the average capital cost, including direct materials and launch costs, for our constellation of over 90 Block 2 BlueBird satellites will fall in the range of $21 million to $23 million per satellite. Our cost per satellite estimates are subject to fluctuations based on dynamic geopolitical factors that could impact our costs.

As a reminder, the timing of the changes in our adjusted operating expenses and capital expenditures, as I have just described, could be delayed or may not be realized due to a variety of factors. Our planned revenue ramp continued during the fourth quarter, and we expect to continue to grow in 2026 holistically. With respect to revenue generation, we believe we can enable continuous SpaceMobile service across key markets such as the United States, Europe, Japan, and other strategic markets with the launch and operation of approximately 45 to 60 BlueBird satellites, and enable additional strategic worldwide markets with the launch and operation of approximately 90 BlueBird satellites.

Further, as we continue to launch and deploy our constellation, we will continue to support U.S. government applications, currently ongoing and accelerating as our constellation grows. In the fourth quarter, we recognized revenue of $54.3 million, primarily driven by gateway hardware sales and various U.S. government service milestone achievements. Additionally, in Q4, we recognized revenue in connection with the provision of critical consulting services for an MNO partner. For the full year of 2025, we achieved revenue of $70.9 million, representing the top end of our 2025 revenue guidance range of $50 million to $75 million.

Now turning to our revenue expectations in 2026, we manage the top line with a focus on full-year performance, given the quarterly variability inherent to our business, including the timing of contract signings, equipment sales, and milestone achievements. As a result, we believe our revenue performance is best evaluated on a full-year basis. As we continue advancing our launch and network activation initiatives, we expect revenue to grow meaningfully relative to our 2025 financial performance. Specifically, we expect to generate full-year 2026 revenue in the range of $150 million to $200 million.

We expect revenue to continue to be driven by gateway deliveries, achievement of contracted milestones for the U.S. government, and MNO consulting services, with potential upside related to the recognition of initial commercial service revenue. Quarterly revenue will likely vary significantly depending on achievement of milestones and the timing of customer activities. We believe that approximately half of the revenue opportunity within our commercial pipeline this year is already booked or contracted. The remaining portion consists of a combination of advanced-stage opportunities that have not yet been signed, as well as net new business we expect to secure over the course of the year.

As previously noted, we anticipate government-related revenue growth to be driven by the factors outlined earlier in Scott's remarks. The achievement of our revenue plan remains subject to several contingencies, including the successful launch and deployment of Block 2 BlueBird satellites, related U.S. government applications, contractual milestone achievements, critical gateway equipment sales to our MNO partners and their anticipated commercialization efforts of SpaceMobile service, and service revenues in connection with the activation of our commercial service provided by our existing and planned deployed and operational satellites.

Finally, on liquidity, on a pro forma basis inclusive of cash raised in February via the convertible notes offering, with a 2.25% ten-year coupon at an effective strike price of $116.30 per share, and the available liquidity under the at-the-market, or ATM, facility, our cash, cash equivalents, and restricted cash as of December 31, 2025, was approximately $3.9 billion. Primary drivers for this cash increase include the execution of the two convertible notes offerings in October 2025 and February 2026, for a total of approximately $2.2 billion of net proceeds, and approximately $76 million of net proceeds raised from the 2025 ATM facilities during Q4, leaving approximately $80 million available under that facility.

In addition to capital raised via the recent 2.25% ten-year convertible notes, we also took action since our last earnings call by further reducing our outstanding debt related to the January 2025 and July 2025 convertible notes, each due in 2032. Following the February equitization transactions, we have now converted approximately $457 million of the outstanding $460 million of the January convertible notes into 19.2 million Class A shares and $250 million of the outstanding $575 million of the July notes into 4.5 million Class A shares. We will continue to look at attractive debt reduction efforts, including convertible notes, as the year progresses.

Given the current strength of our balance sheet that now includes cash, cash equivalents, restricted cash, and available liquidity under the ATM facility of over $3.9 billion on a pro forma basis as of December 31, we are now not only fully funded to manufacture and launch a constellation of over 100 satellites to provide worldwide SpaceMobile service, but we have increased our financial flexibility to make further investments to expedite the timing of and augment the capabilities of our SpaceMobile service. At this time, we do not have any plans to pursue additional convertible debt.

The combination of increasing commercial and government opportunities, rapidly scaling manufacturing and satellite launch operations, and a fortified balance sheet firmly positions AST SpaceMobile, Inc. to achieve our objectives on behalf of all of our stakeholders in 2026 and beyond. I am incredibly proud of the significant progress the company made in 2025, backed by the intense focus and tireless efforts of our worldwide workforce. It is now time to further focus on our launch cadence to bring SpaceMobile service to connect the unconnected in the coming periods. I will now turn the call back to Scott Wisniewski. Scott?

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

Operator: Justin from Georgia asks, any interesting learnings from BB6 and 7? Is the production of composite satellites going to be vastly different? Any unforeseen delays?

Abel Avellan: Thank you, Justin, for the question. BB6 is the largest phased array ever deployed in space. It is 3.5 times bigger than our previous deployments, which were also the world record on size, and, going through that first deployment of 2,400 square feet successfully, learning how to capture, control, and manage the satellite at that size will allow us to actually do it much faster as we do 7, 8, 9, 10, 11, 12, 14 satellites that are upcoming. So, yes, that was a very, very important milestone in learning how to operate, deploy, and fly something of this size, which will help us to do it faster in the next deployments.

The other thing that will happen going forward after 6 and 7 is that we are stacking the satellites. So we are not launching individual satellites anymore. They will be batched in groups of either three, four, six, or eight in a single launch. That is what will allow us to meet our launch cadence this year, with an expectation of 45 satellites in orbit and 60 satellites ready to ship during 2026.

Operator: Justin also asks, is there an updated timeline for the mid-band constellation for using L- and S-band spectrum?

Abel Avellan: Yes. There is. We are planning to start launching the mid-band constellation by the end of the year. The mid-band constellation has the advantage of combining 3GPP standard operator-owned frequencies and also our L- and S-bands, which combined give great flexibility to the offering and also allow us to continue to increase the peak data rate capacities that we have in our system, going way above our 120 megabits per second that we already have in Block 1.

So that allows a combination of IMT spectrum, which we see as a RAN extension to extend capability in places where there is no spectrum lit up, to overlay spectrum in our L and S in order to cover all locations as a supplement and an augmentation of the terrestrial network with data rates that far exceed our current 120 megabits per second in the low-band Block 1 satellites. With the larger satellites and with access to combining, in certain regions, over 100 megahertz of spectrum—combining the spectrum of our network partners and our own—this will give a true broadband experience on a global basis.

Operator: Laiden from New Zealand asks, with the larger designs complete and being produced, do you anticipate future R&D or new product lines? This may be data centers, exclusive military constellations, collecting data on usage, providing aircraft and ship traffic radar, etcetera.

Abel Avellan: Thank you, Laiden. The most difficult aspect of the R&D with the launch, deployment, and usage of our BB6— the core aspect of it—is complete. So the ability to produce a lot of power, the ability to have a very large aperture with a very sensitive aperture, the ability to have many, many gigahertz of processing power with our own ASIC, the ability to do it cost effectively with our own power generation technology—all of that R&D has been completed and is an integral part of what we have and where we are operating, and, as you said, being completed. Now we do see many other opportunities for the technology that we are starting to see usage of.

One is radar. Another is power generation. Another one is multiplying the spectrum usage. We believe that combining our large aperture with our AI capability will create a multiplier for the spectrum. So the 50 megahertz that we have will feel a multiple of that. It could be three times that. It could be 10 times that. We see a lot of opportunities combining all these capabilities, including very precise geolocation, radar, communications—all that wrapped up with an AI infrastructure. We think there is significant additional value that we can create with our infrastructure and the already invested R&D.

Operator: Kevin from Vancouver asks, can you share more color on the most recent $1 billion convertible note offering? Many investors are confused as your current liquidity was already approximately $3 billion and sufficient for around 100 satellites. Were there any specific opportunities in mind when you issued the offer, or is it really “just in case” something pops up?

Andrew Martin Johnson: Thanks for that question, Kevin. This is Andy. It is absolutely the case that in Q4, when we finished the convertible in October, we were in a position to fully fund the worldwide constellation at 100-plus satellites. Nothing has changed on that front. And the convertible deal that we did at just over $1 billion in February provides us essentially extra flexibility to look at investments that go beyond that first 100 constellation. What I mean by that is, number one, we can accelerate the deployment of our controlled global spectrum with this added funding. We also have the opportunity to monetize our technology to capture commercial opportunities related to AI, which are increasingly coming our way.

We will look to deploy funds to enhance our investment in government space opportunities in the United States. We have talked about our debt profile. These funds provide us flexibility to look at reducing higher-interest debt that we currently have. And finally, opportunistically, any investments that help us accelerate the time to bring SpaceMobile service and capabilities will be a good use of these funds as well. And I would just close by noting that we have confirmed that we have no current plans to look at an additional convertible deal. We feel that the balance sheet is where it needs to be to provide us the opportunity to execute our objectives in the near and midterm.

Scott Wisniewski: And with that, I would like to thank our shareholders for submitting those questions. Operator, let us open up the call to analyst questions now.

Operator: Thank you. And if you would like to ask a question, please press 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press 2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from the line of Griffin Taylor Boss with B. Riley Securities. Please proceed with your question.

Griffin Taylor Boss: Hey. Good afternoon. Thanks for taking my question. So, first, I just want to talk about, you know, this expanding TAM that you have talked about. With the dual-use capabilities and government contracts, do you see any scenario where you build and launch future Block 2 BlueBird satellites with different payloads that might be exclusively for government customers or applications?

Abel Avellan: Hey. How are you? Listen, the satellites are really designed to manage all these applications in a single platform. So, we do not need multiple satellites for multiple payloads. The core applications for our government contracts and for our partnership with the MNOs are all possible through the same platform, which are in fact already being used in combination of the two. So we want to maximize and take advantage of a platform that can be used simultaneously for the two.

Griffin Taylor Boss: Got it. Okay. Understood, Abel. Thanks for that. And then just a second one for me. You always mentioned your thousands of patents and you talked about on this call your expertise in building and deploying massive structures in low Earth orbit that could be used for, you know, myriad opportunities and, you know, you specifically call out these burgeoning opportunities in AI. You called that out with a convertible raise too. But you have this one specific patent that has been of interest to us for a while for thermal management systems for structures in space.

And, you know, that is a patent that describes a process for a satellite wherein, you know, heat is dissipated locally at each antenna and heat could be directed to each antenna assembly during periods of extreme cold. So just curious if you could maybe elaborate on that specifically as well as, you know, your other capabilities and how that could potentially be used for opportunities in data centers in space or why that makes, you know, AST satellites attractive for those types of capabilities.

Abel Avellan: Yeah. No. Absolutely. I mean, there are many key enablers that needed to be designed by us and deployed and patented in order to solve probably the more difficult problem, which is connecting broadband to regular handsets. For that, we needed to develop and vertically integrate 95% of our technology. We had the technology to produce low-cost power that is very significant at our size. We are a factor of 10 lower per square meter in power production cost versus what historical manufacturers have been using.

The size of the satellite and then the ability to generate power at a low cost per square meter and then being able to dissipate and effectively run a lot of wattage per square meter within the power constraints of space. So that is why we have built up a significant portfolio of IP. That particular technology you mentioned is a technology that enables a lot of things.

Then, when we talk about the ability to manage the spectrum using AI capabilities—we call it AI spectrum management—the ability to use these satellites not only for communications but other applications like radar, and when you combine that with the ability to store and manage data in a way that uses the spectrum very, very efficiently, it opens a lot of other opportunities on the TAM that we have. We believe the largest TAM is in true broadband directly to the handset, where you will be basically becoming what I call the third leg of communications. You have Wi-Fi, you have cellular, and now you have space.

And our belief is to participate at scale in a way that is meaningful for our global operators, the broadband capability is essential. And it is something that we have now. I mean, that is what we have with the satellite that we are deploying right now, and we are extremely happy on the performance that we see on our BB6 in the new 2,400 square feet platform that we just launched.

Griffin Taylor Boss: Got it. Thanks for all the color, Abel. I will hand it off here and hop back in the queue. Thanks for taking my questions.

Abel Avellan: Thank you.

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

Colin Canfield: Hey. Thank you for the question. As we parse out the comments that you talked about on 2028 revenue potential, just thinking like the bull-bear of what you said, so multiples versus $1 billion potential in 2027, which suggests, let us call it, $1.5 billion to $3.0 billion for 2028. How does the team kind of think about the mix of opportunities between government and B2B customers? And then kind of within B2B, how do you think about tech discussions between communications, intelligence, and on-orbit compute? Thank you.

Scott Wisniewski: Thanks, Colin. I will take that. So we put forward our expectations for revenue in 2026, building on the high end of our guidance that we achieved in 2025. And then we stated a goal for 2027. So we did not state anything for 2028, so I will keep my comments to 2027.

But I think what we see is, as we get this platform on a full-year run rate, and we are able to put the consumer business—the D2D communications business—in place in some of the most favorable markets globally, and then you put that alongside our government applications getting some time to mature and some potential contract wins we are chasing, that is how we got to that 2027 goal number. And we think that is probably more weighted towards commercial based on that framework, but of course there is upside if government does better. And as you go out into 2028 and later in the decade, ultimately, we do think that our commercial business is going to be bigger.

That has always been the premise. So commercial, at scale, should be bigger than government. We think that market is really attractive. We think all the demand drivers we have tracked for seven or eight years of the company are intact and growing stronger by the day. But the government business is also very attractive. And, as we said, with all the various use cases we are tracking, there is potential for multiple billions of annual revenue through those use cases as well. So we see a really bright picture. I would say it is largely consistent with how we have always seen it, although government has trended up over the last year or two.

But that is how we see the mix playing out, and, as we are deploying and as you saw, we put out a number of customer announcements today. We see the strength of that demand as strong as ever.

Colin Canfield: Got it. Thank you. I appreciate that. And as we think of the progression of growth, is it fair to use the 4Q performance as a baseline for 2026 and then grow from there, or is the commentary in terms of growth for 2026 more aligned with just growing from the 2025 annual number?

Scott Wisniewski: The way I think about it is, before we initiate commercial service here, we are doing revenue that is kind of earlier stage. So the commercial revenue is not as consistent, and the government revenue is building nicely, but much lower than where it can be. So quarter to quarter, I would not say we are planning on building quarter to quarter. Think about it annually, like Andy put it in his speech. It is really about an annual target. And so I think at least doubling where we hit in 2025 is the right way to think about it, with, of course, upside as we launch commercial service.

But quarter to quarter, at least in the next few quarters, before commercial service comes into play in 2026, that is how to think about it. We are putting commercial infrastructure in place, and we are performing against our government pipeline.

Colin Canfield: That is great. Thank you.

Max Colbert: Thank you.

Operator: Our next question comes from the line of Bryan D. Kraft with Deutsche Bank. Please proceed with your question.

Bryan D. Kraft: Hi. Good afternoon. I am just trying to understand the manufacturing side a little bit better. Would you mind providing just some color on how many satellites beyond BB7 are built and ready to ship today, and maybe how many you expect to be built and ready to ship by midyear? I know you talked about the Microns, and those are the hardest part, but I think there is some assembly that takes some time beyond the Micron themselves. Then, just related to that, I think clearly the manufacturing pace is somewhat behind where you had expected it to be.

Perhaps you could maybe just give us some appreciation for the kinds of things that maybe took longer than you had expected and whether you think you have now worked through all those issues and you are kind of accelerating the pace up to where you had expected it to get to. Thank you.

Abel Avellan: Yeah. I think we are at a point where you see that acceleration. We certainly see that in the manufacturing of the key building block, which is the Micron. We are on satellite 30–60 in Micron production. We are on target to at least be ready to ship this year 60 satellites, with a minimum of 45 into orbit. We went through a phase and, you know, just a year ago, our satellites were 3.5 times smaller. They were already very big. They were the biggest ever launched. This one—these ones—are 3.5 times bigger, and that is maybe BB6 and BB7.

Past that, what will help us to accelerate our cadence of satellites in orbit is we are able to stack them, and that stack is difficult. You need to be able to stack either three, four, six, or eight satellites, and that is near completion. So you will see batches of six getting out of the factory very soon here.

Bryan D. Kraft: And, okay, so on the stacking, if I may, just in layman’s terms, are you saying that there are specific engineering things that you had to figure out in order to get the stacking right, or are you just saying that getting that many done at once so that you could stack them and get it ready for a combined launch took some time? Just if you do not mind clarifying.

Abel Avellan: Getting them ready for a combined launch is the key. I mean, you are talking about something like a five-story building worth of satellites, stacking them in either blocks of three, four, six, or eight. But that process is completed, and the next batch of six—you will see the pictures in the deck that we put in the IR deck—and we have passed that phase and are getting ready to resume the shipments to the Cape.

Bryan D. Kraft: Thank you. If I may sneak one more in, I know you said that BB7 is expected to go up this month, and then, you know, launches every one to two months. Could we expect possibly a launch with multiple satellites in April, or is it likely to be two months post the March launch?

Abel Avellan: Yes. All further launches are in a stacked configuration. We do not have any more single launches like we did on BB6 and BB7. This next coming launch is super important for us, as it basically allows us to reuse the first stage of the New Glenn, which is the only commercial platform that exists that can actually stack eight of our satellites. The other platforms can stack six or three. With the New Glenn, we get the maximum amount of satellites per launch, and that ability is becoming available with the new satellites.

Scott Wisniewski: And, Bryan, I would just add that we expect to ship that next batch in April. So depending on timing, and, of course, under ideal conditions, it is about three weeks or so to launch from there. So we are not going to speculate on launch timing for that, but we look to be in a position to ship those in April. And you can see that on page 10 in our deck.

Bryan D. Kraft: Okay. Great. Thank you.

Operator: Thank you. Our next question comes from the line of Louis De Palma with William Blair. Please proceed with your question.

Louis De Palma: Good evening, Abel, Scott, and Andy. Congrats on all of the partnership announcements and the progress with your constellation. First, I was wondering, are you in Barcelona for the conference? And will there be more announcements this week besides what you have already announced? Are you holding back certain announcements?

Scott Wisniewski: Hey. How are you doing? It is Scott here. Yeah, we are in a conference room in Barcelona, so it is great to do the call this quarter on the road. But, yeah, we did have a flurry of announcements today, and you can expect more for the rest of the week as well.

Louis De Palma: Excellent. And my second question is, what service level will your network support when you launch the different beta offerings in the summer? Will there be different phases in terms of the service capabilities as more satellites come online? Or should the initial beta that launches—whenever that takes place—have close to a true 5G experience?

Abel Avellan: Yeah. The way to think about this is peak data rate. So what peak data rate you can expect on the phone will be directionally proportional to the amount of spectrum that we get allocated, which, with some partners between our spectrum and their spectrum, can add up to around 100 megahertz. And you can put a multiple of that number of megahertz to think about what is the peak data rate. Today, we are managing between three and four bits per hertz, so that multiple is in that order.

So the initial launch of commercial services is with the lower end of that, as the allocated spectrum will be less, but as we enable more spectrum—which the satellites support now—they have great flexibility to keep adding spectrum and later even combining low-band spectrum with mid-band spectrum. Then you will see the peak data rates keep enhancing. So that is the way to think about the key performance metrics as we launch services.

Louis De Palma: Thanks. That makes sense, Abel. And one financial question: for the $1 billion revenue goal for 2027, how much of that is customer or subscriber usage-based versus being minimum revenue commitments that are contractually obligated with your MNO partners such that, if you actually are able to get between the 45 and 50 satellites online by the end of the year, how much of that $1 billion has been already in the bag, so to speak?

Scott Wisniewski: Sure. So, remember, we are at $1.2 billion contracted backlog right now, which we are very proud of and is a testament to how we have built the ecosystem with our partners and how confident our partners are in the business that we are building. But that is still a very low number compared to what our expectations are for the revenue potential of the business. So while it is a good indicator—that backlog, which again is over $1.2 billion— in terms of its contribution each individual year, it will be a minority for sure.

So if we are, in terms of a goal of a billion dollars, you can think of that in the low hundreds of millions—somewhere in the $100 to $300 million range depending on the year.

Louis De Palma: Great. Thanks, Scott. Thanks, everyone.

Operator: Thank you. Our next question comes from the line of Christopher Schoell with UBS. Please proceed with your question.

Christopher Schoell: Great. Thank you. Looking at your new disclosure, it appears your services gross margins are around 90%. Is this a good way to think about the business longer term? And as revenue generation starts to kick in, can you just remind us how you are thinking about operating leverage and where you believe steady-state EBITDA margins can reach for the business? Thank you.

Scott Wisniewski: Yeah. We have been pretty consistent about this over time. And when you look at the history of the satellite industry when it has been performing well, it has margins in the 80-plus percent range. And even today, if you look across the market, there are businesses with 90-plus percent flow-through margins in certain segments of their business. They just might not report it that way. So this has just tremendous operating leverage in it, and we have always known that off a fixed cost base. So as we have built the business, nothing has really changed.

We struggle to find true variable costs in a meaningful way, and this is compounded by the fact that, remember, our go-to-market strategy is with a revenue share. So that is a big way that we even get greater leverage in the business and make it not just wholesale, but super wholesale. So at this point, our flow-through margins and our operating leverage we think, over time, could contribute to an EBITDA margin in the 90% area or higher.

Christopher Schoell: Great. Thank you. If I can just fit in one more. I recognize that the 10-Ks talk about 90 satellites supporting your longer-term business goals, but does your ability to raise capital maybe incentivize you to perhaps go beyond what is contemplated in the original business plans?

Andrew Martin Johnson: I think having that flexibility— I mean, markets and the capital have been wonderful for us over the past year, so that is absolutely the case. But the reality is, when we get our constellation built, we are going to get leverage in the P&L to actually be cash flow positive from operations. So we do not feel like at this point we need to look beyond what we have raised right now. It provides us the flexibility to make additional investments opportunistically in so many other things that we are doing on our spectrum strategy. But the real goal is to generate revenue and profit from the constellation as we get it launched.

So that is how we are thinking about it right now, but it is certainly nice to have the balance sheet fortified the way it is.

Christopher Schoell: Okay. Great. Thank you.

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

Greg Pendy: Hey, guys. Thanks for taking my question. Just a real quick one. On the operating expenses, could you just remind us what you said? And does that include what will likely be spectrum licensing fees—maybe around $20 million a quarter—or, I am sorry, spectrum lease payments?

Andrew Martin Johnson: Yes, this is Andy. So it is a bit of a walk here. You have got sort of the GAAP OpEx, which includes the normal non-cash items we adjust out, which we have talked about, and then from there we also have the cost of revenues, which, when we get to service, will be moving to a more traditional COGS P&L that you would be more used to there. But then when you net that out, my commentary was that we were just slightly over where we were in Q3 of 2025 and right in that guidance set that I gave for Q4 in the mid-$60 millions.

It does not include spectrum costs as you described for licensing, given that those are capitalized until we actually start monetizing that asset. And, of course, we are at the point where we are awaiting FCC approval. So we will speak to that as a specific item when it comes time to build that into the operating expense. But right now, apples to apples, that has been out during the course of 2025.

Greg Pendy: Very helpful. Thanks a lot.

Max Colbert: Thank you.

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

Scott Wisniewski: Thank you, operator. And we want to thank all of our shareholders and research analysts for joining the call. We hope to see many of you down in Florida at our upcoming launch. Thank you. Bye.

Operator: This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has positions in and recommends AST SpaceMobile. The Motley Fool has a disclosure policy.