Posted: Friday, May 13, 2022
The 'Space-as-a-service', 'Satellite-as-a-service' and 'Space Data as a Service' are the newest business models of Space Industry, according to a recent report from International Defense, Security & Technology Inc (IDST). They said that the modern space industry is witnessing exponential growth in small satellite and nanosatellite areas. Nanosatellite and microsatellite refer to miniaturized satellites in terms of size and weight, in the range of 1-10 Kg and 10-100 kg, respectively. 'CubeSat' is one of the most popular types of miniaturized satellites. These are the fastest-growing segments in the satellite industry. It is expected that the numbers of satellites in orbit are going to increase more than linearly with about 8000 spacecraft in orbit in 2024 due to constellations only. Over 2500 nanosats are estimated to be launched in 2021-2027. The report said: "The growth in small satellites is driven by the miniaturization of electronics and sensors and the availability of high-performance commercial off-the-shelf components, significantly reducing the cost of hardware development. The other rationale for miniaturizing satellites is to reduce the launch cost; heavier satellites require larger rockets with a greater thrust that also have a greater cost to finance. In contrast, smaller and lighter satellites require smaller and cheaper launch vehicles and can sometimes be launched in multiples. The access to orbit and economy of these spacecraft is also improved through the availability of secondary launch payload opportunities, especially for small satellites which conform to standardized form factors. They can be launched 'piggyback', using excess capacity on larger launch vehicles." Active companies in the markets this week include Sidus Space, Inc. (NASDAQ: SIDU), Tesla, Inc. (NASDAQ: TSLA), Amazon.com, Inc. (NASDAQ: AMZN), Lockheed Martin Corporation (NYSE: LMT), Virgin Galactic Holdings, Inc. (NYSE: SPCE).
The report continued: "As the space sector expands, companies large and small are adopting new business models, including Space Data as a Service, Satellite as a Service and Ground Station as a Service, These new models are emerging as the space sector is witnessing large commercialization of satellite applications, which has opened new opportunities through the use of small satellites, on-orbit servicing, and low Earth orbit constellations. These services promise the benefits of space without the demands of satellite manufacturing, government regulations, launch integration or space data delivery. The software technology sector has been shifting from an upfront customer purchase to a service model – Software-as-a-Service (SaaS) — for years now. Using the cloud and a baseline subscription service model, the sector achieves steady recurring revenue, high customer renewal, and scalability. In turn, customers access the exact solutions they need, avoiding upfront costs and risks. One of the most successful variants in the SaaS market is called "vertical software," which focuses offerings on very specific industry segments such as healthcare or construction. The space sector is beginning to catch up to some of these trends in the wider technology arena, beginning with the purchase of subscription services (OpEx) rather than the purchase of hardware (CapEx)."
Sidus Space, Inc. (NASDAQ: SIDU) BREAKING NEWS: Sidus Space, Inc. Reports First Quarter 2022 Results and Business Update - Revenue Increased 1075% in First Quarter 2022 from First Quarter 2021 - Sidus Space, Inc., a Space-as-a-Service satellite company focused on commercial satellite design, manufacture, launch, and data collection, today announced recent company highlights and financial results for the first quarter ended March 31, 2022.
Q1 2022 Financial Highlights:
Revenue increased to $1,799,335 for the three months ended March 31, 2022 from $153,136 in the comparable period of 2021, an increase of 1075%. This was driven by growth in number of customers and significant growth in the size of contracts.
Gross Profit increased to $978,337 for the three months ended March 31, 2022 from a loss of $134,540 in the comparable period of 2021. This was primarily attributable to the increase in revenue and decrease in labor intensive contracts and an increase in our higher margin Satellite-as-a-Service business line.
Operating Expenses increased to $3,242,783 for the three months ended March 31, 2022 compared to $385,174 for the three months ended March 31, 2021. This was primarily the result of the expansion of staff, the leasing of more space for expansion and a one-time non-cash expense of $1.2M.
As of March 31, 2022, the Company had $10.4 million in cash.
March 31, 2022 Operational Highlights and Recent Developments
We announced the upcoming launch of the LizzieSat™ aboard a NASA Commercial Resupply Services (CRS) rocket (wherein SpaceX and Northrop Grumman are contracted to launch to the orbiting laboratory). LizzieSat™ is scheduled and expected to be delivered to the International Space Station (ISS) later this year.
We announced the successful completion of the LizzieSat™ (LS) Preliminary Design Review (PDR). A PDR ensures the design and basic system architecture are complete and that there is technical confidence the capability need can be satisfied within cost and schedule goals. A successful PDR means that a satellite is on track and development is progressing as planned.
Over the last three months we rounded out our executive leadership team with the hiring of three key individuals with highly relevant industry experience including positions with Lockheed Martin, NASA, Blue Origin and others. These individuals include John Curry as Chief Mission Operations Officer, Teresa Burchfield as Chief Financial Officer and Gerry Schaafsma as Chief Sales and Revenue Officer.
We continue to manufacture and deliver hardware to a broad range of customers including the Department of State, the Department of Defense, Northrop Grumman, Leidos, Aegis, Teledyne Marine, Bechtel, and L3Harris in areas that include launch vehicles, satellite hardware, and autonomous underwater vehicles.
"As we delivered on previously announced contracts, our revenues increased dramatically. We believe that we are well-positioned to compete with legacy space-based data providers and other emergent providers due to our vertical integration strategy that combines rapid production with flexible technology insertion points. While readying for launching numerous satellites over the next 12-24 months, we anticipate our backlog to continue to increase. The company, built on years of experience manufacturing for commercial, military and government customers, has positioned itself to become one of the leading companies in the low earth orbit (LEO) satellite industry. We believe the LizzieSat constellation of satellites will level the playing field by bringing space down to earth for everyone and making access easier for all consumers," commented Carol Craig, Founder and CEO of Sidus Space. CONTINUED… Read this full press release along with full balance sheets for SIDU at: https://www.financialnewsmedia.com/news-sidu/
Other recent developments in the makrets of note include:
Tesla, Inc. (NASDAQ:TSLA) - Morgan Stanley said that Most "institutional investors and industry experts" surveyed by Morgan Stanley expect SpaceX to become more valuable than Tesla and see it as a more attractive investment. Elon Musk's two largest companies already command enormous valuations, with Tesla currently at $858 billion and SpaceX at $100.3 billion. "From our investor conversations, the sentiment on SpaceX has increased substantially along with the company's valuation in the private market," Morgan Stanley analyst Adam Jonas wrote in a note.
Between Elon Musk's two largest companies, investors and experts have a long-term favorite. Most "institutional investors and industry experts" surveyed by Morgan Stanley expect SpaceX to become more valuable than Tesla and see it as a more attractive investment. "The majority of our clients (by survey and client discussions) believe SpaceX could ultimately command a higher valuation and significance than even Tesla," Morgan Stanley analyst Adam Jonas wrote in a note Tuesday.
Amazon.com, Inc. (NASDAQ: AMZN) recently announced financial results for its first quarter ended March 31, 2022.
Operating cash flow decreased 41% to $39.3 billion for the trailing twelve months, compared with $67.2 billion for the trailing twelve months ended March 31, 2021. Free cash flow decreased to an outflow of $18.6 billion for the trailing twelve months, compared with an inflow of $26.4 billion for the trailing twelve months ended March 31, 2021. Free cash flow less principal repayments of finance leases and financing obligations decreased to an outflow of $29.3 billion for the trailing twelve months, compared with an inflow of $14.9 billion for the trailing twelve months ended March 31, 2021. Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations decreased to an outflow of $22.3 billion for the trailing twelve months, compared with an inflow of $16.8 billion for the trailing twelve months ended March 31, 2021. Common shares outstanding plus shares underlying stock-based awards totaled 523 million on March 31, 2022, compared with 519 million one year ago. Net sales increased 7% to $116.4 billion in the first quarter, compared with $108.5 billion in first quarter 2021. Excluding the $1.8 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 9% compared with first quarter 2021. Operating income decreased to $3.7 billion in the first quarter, compared with $8.9 billion in first quarter 2021. Net loss was $3.8 billion in the first quarter, or $7.56 per diluted share, compared with net income of $8.1 billion, or $15.79 per diluted share, in first quarter 2021. First quarter 2022 net loss includes a pre-tax valuation loss of $7.6 billion included in non-operating expense from our common stock investment in Rivian Automotive, Inc.
Lockheed Martin Corporation (NYSE: LMT) recently reported first quarter 2022 net sales of $15.0 billion, compared to $16.3 billion in the first quarter of 2021. Net earnings in the first quarter of 2022 were $1.7 billion, or $6.44 per share, compared to $1.8 billion, or $6.56 per share, in the first quarter of 2021. Cash from operations was $1.4 billion in the first quarter of 2022, compared to $1.7 billion in the first quarter of 2021. Free cash flow was $1.1 billion in the first quarter of 2022, compared to $1.5 billion in the first quarter of 2021.
"Lockheed Martin had a solid start to the year by delivering margin expansion and free cash flow above our expectations despite recent Covid-surge impacts on our operations and supply chain. We remain confident in our guidance for the remainder of the year and our growth outlook beyond," said Lockheed Martin Chairman, President and CEO James Taiclet.
Virgin Galactic Holdings, Inc. (NYSE: SPCE) recently announced its financial results for the first quarter ended March 31, 2022 and provided a business update.
"We are executing on our plans to scale the business by developing our future fleet, investing in digital manufacturing technologies, and building out our commercial strategy to deliver a consumer experience like no other," said Michael Colglazier, Chief Executive Officer of Virgin Galactic. "Against a backdrop of escalating supply chain and labor constraints, our teams are containing the majority of these issues to minimize impact on schedules. We look forward to returning to space in the fourth quarter and launching commercial service in the first quarter of next year."
First Quarter 2022 Business Highlights Were: In January 2022, completed a convertible debt offering that resulted in $425 million in gross proceeds to the Company. $52.3 million of net proceeds were used to fund the cost of capped call premiums related to the transaction. The remainder of net proceeds are expected to be used to fund working capital, general and administrative matters, and capital expenditures to accelerate the development of the Delta class spaceship fleet and next generation motherships.
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