Globalstar (GSAT) 7 Mar 222022 Q4 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Globalstar Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Jay Monroe, Executive Chairman.

Thanks for joining Globalstar's fourth quarter and full year 2022 investor call. call Harbor statements laws. provided today's within to that Safe the under note contains intended forward-looking fall Please the securities that for and week's results in the including in its the could last materially on filings, year Factors described Form ended report are and XX-K Globalstar's to SEC the financial factors earnings risk differ statements release. annual section the of forward-looking cause XXXX

it. to since time last call, be our back pleased at It's been some and earnings we're

busy announcing powerful, our more. executing, list and critical been long have involving We much interim developments developing, spectrum, of a so in long-term the services, wholesale partnerships

We also Day host Investor plan provided our to full a similar events presentation time during November the and and in when update right. is

on our to be earnings to Clary, Kagan, the future plan Kyle moving periods hitting brief, Dave and and prepared will questions. comparatively for to Tim we keep available the highlights prior Rebecca answer Pickens directly your and calls, this On Today, remarks Q&A. call Taylor

As satellite about on plan. Xth wholesale not our answer we future focus announcement, Instead, to September aspects be of other we partner able has the we company's questions XXth -- the services. even announcement business. that our is wholesale any of But September will business will or their say been of what can the our before policy is the foundation

including finalizing finish which at continue will class, this our work opportunities, utilizing execute the to We capacity, for retained September. own to NTN our our XGPP expect we band new satellite

operate on networks, satellite and the proliferation addressable connectivity. of with and greatly market for able total terrestrial chipsets Standardization satellite NTN to for devices both increasing the allows

deployed This fully new spectrum unique will this today wholesale grow as while consistent business which satellite Globalstar and materially generate are for allows bands. S the contracted, maintaining future, cash in coming protected will in years. licensed assets to the and operate satellite assets C flow which L, do strategy We the we the through

are capacity. and to of and a to business the effort, exciting businesses. available our is $XXX satellite top Duplex close excess On our revenue MSS and announcing SPOT million wholesale partnership by We anchored in annual core legacy new of generates help utilize our

As and major the first product very business MSS growth have Commercial we for our IoT will from year. as of we IoT, had later expected experienced, the launching core driver which this soon benefit is introduction X-way our

We continue close have to to in to help appropriately believe the and sales. opportunity significant team this growth added

major in terrestrial week. have announcements Our assets spectrum develop last just the continued with two well to

in the authority First, successful completion national Europe, Spain, of the continents. X many Band for in which across XXth Spain licenses more there. represents terrestrial XX foreshadow authorization our should first

new with yesterday, Qualcomm. Secondly, we collaboration our announced

with radio the As The calls vendors spectrum agreement platform, is RF the including for cell introduced into to wireless availability view will of Band chipset both an and FSM and the increase the The additional summer. rapid infrastructure substantially Qualcomm private its secured, increasingly this borderless expected rolling strategic this introduces national of small for XX XG and front Qualcomm networks. resource. ecosystem FSM number this is full important Band the out XX. adoption be end. authorizations This as are we Qualcomm network, the sales

other of Qualcomm or of Qualcomm's Qualcomm's commercial Band range and Qualcomm the enabled XX Band be laptops also of largest, world's chipset their and will via Qualcomm mobile smartphones, XX positions globally. XG The that of business, encourage will for further spectrum new suite offer the devices across use our Partners system access global jointly through with SIs, channels. products integrators, to widest will agreement global monetize so Band be expanding network offered these the XX. with multiple ecosystem able to and through solutions rapidly Globalstar a Globalstar working to with

have with can terrestrial any other in the initial Qualcomm where spectrum us Together of U.S. XG Band following expand authority. we solutions support in modems. This effort company's to with ecosystem of network country and in prior SIs, obtained these represents continuation the XX in or a to agreement the Globalstar Snapdragon deploy support new announcement their

We terrestrial of negotiations Band with in hundreds of users dollars annual for XX. spectrum are representing of millions leases

we including to are to shareholders and the to the at the and sign Globalstar accelerating we remaining the the financing near this hand. structure conditions complete the well dilution. announced precedent, X-K, was an front, last refinancing we of week, capital facility On opportunities accomplished first-lien are did in in currently the pleased working value improved positioned realize are of the flow, were cash very which without future. agreements the And With

the alternatives continue is distribution to industrial and This established a across use we our IoT my year. offerings is this evolving introduction versus products Concluding us increasing module as and more of and represented the X-way X-way XXXX market a more today, increasing close the our significant critical believe allows channel. again company's a with opportunity existing will becomes The EBITDA massive and large IoT financial later growth accelerating, in gap an Entering OEM IoT cases. including will revenue connectivity adjusted Commercial market and accelerate XX% this growth results, competitive remarks will with improvement Globalstar, service attack the for XX%. and we

Dave, focusing up remind on related not results. whomever in are and our the questions business the financial part advance other We questions open to our activities our Kyle questions answer of call we Please to market. to Tim. will thank we handset direct the you And for in Q&A, to you you your prefer. direct including able the now Rebecca, and that We availability of

Flannery first with Morgan from Stanley. [Operator Simon Instructions] question Our comes

be revenue color new will coming And revenues your I flow, and cash your versus was extent cash you can around wondering if any and comments of provide additional talk inflows? to any out CapEx deferred comments guidance that? around to what you just could or prior particularly, more updates to free the XXXX balance

Rebecca. It's Simon. Sure,

guidance confident range revenue reaffirmed, XXXX third nothing in from that we of earnings September week. last has to and $XXX those in the have million we quarter There's that that still signed our we projections release prepay the about that believe, issued $XXX changed would agreement November, million. in I that So impacted feel

changed, CapEx, So has obviously. though,

So now about committed to we're funding operating $XXX new the of the flows. primarily million through satellite for CapEx cash

bit as guys over favorable know. having by on And quite so of the couple to interest are funded not rates, at then raise of saving senior $XXX side, be you that will years. of And the a astronomical next million we debt

But a are repayment cash flow the that upwards we're issue those from to we're the in period again, offsetting in depending spending will assumptions, million launched. CapEx satellites So on period. is saving over that million after investment That us terms perspective, more the the of service come of timing $XXX over Phase of just a $XXX construction X CapEx.

investment it's of again, cash and issue. the an just upfront flow So timing

anything revenues, this And how going balance year? or deferred that grow what on year your this decline? the Is you to use revenue

when But as still out have it to do over regardless, earn that service a bit how classification work revenue on the balance turn sheet. Phase deferred period. we will to our the be debt prepayment So little X will revenue we it will or into figure new in as of the far study gas

will in period in deferred revenue, years, Now that is recognized prior sitting started that that be in received the that the $XX million over service November. we

'XX. I it's of Could you And build deal Is by about of said you think the that the been constellation. the since And end Right. a to the looking with update us satellites? a signed manufacturing on year MDA still delivery new launch good? on before and you progress the

Yes, happy go Yes. -- ahead, I'm to Tim.

been working a was anniversary we've weeks on one-year ago. the So the contract, few

the a of initial ago. That milestone the until about leading or contract little first is you eight the happened PDR, And year review. a to design few into a preliminary critical completion design major then up which review. over is months So design months in for the construction period of we're months And nine a months the of it. XX get the that's

XXXX. budget well So we're lined launches up in and schedule, on for on

just last being position talk intersection. positioning competitors? you Globalstar's to hear. one. FCC active Great. be satellite as how And then Could you -- taking what's to to Good terrestrial The relative an about one interest the proposed in see seems just

a and everybody now, take can Simon, changes Generally I that. right in watching speaking, are of that number those. are there Yes, is industry going the on

under so to of our that. And heavy especially have to arrangements. new address its issues FCC the will a of related a series Obviously, spectrum all satellite of is regulatory user Globalstar

to be unlikely that we survive think I someone any And the if process utilize will ours. -- mount that so will that something to direct action FCC it's will wants have

will FCC FCC, how there a and in happen with questions those. next are for that But their the the have with, the front so deal and industry generically, will of will year over to the of number there or in instance, changes T-Mo SpaceX spectrum are wrestle that

So only FCC have of basis on in we I discussions be, XX-year a we're history regulatory globally operating that and, spectrum, will of we of issues every think, ongoing but global cases. therefore, that a cognizant of lot and anticipate within are course, the not harmonized take in issues for front the proceedings, given extremely ongoing which, day. -- ITU settled our context, place our single will And that of more

comes Capital. from question Our next Craig-Hallum George with Sutton

call. and way, thanks -- Jay, at by the Day doing this Analyst for the

great. it's think I

the had significant suggested you Day, you a by agreement Analyst the at year-end. were a for So hoping with partner new potential

towards Can be this update should that you're making on you what just sort this the I any us believe. partnership and progress reiterated of we You expecting? morning, give

a of very as read constantly of Then for was as the you yes, expand of relationships across terrestrial. trying to spectrum doubt, -- pending right authorization. you for We're to foundation we'll last and new of two that part continent George, many models leases a we include them with of more business terrestrial proceed other by which no retained our now to And the roll Spain our the important footprint. out week. of types of bring now the conclusion. are one those those course, in Those well satellite terrestrial looking are that. actually That's categories there capacity.

look near terrestrial alluded Day have come two of to had now. the mentioned I can term, to of those that we think more were are those Investor in to All and I in which that both some which satellite. the But forward fruition we

is you. a refinancing you for of sense to us Got question next be? what just Rebecca. that or be marketed being the that's lien we from facility, first should And how of can the expecting But best give perhaps the structure

Sure.

been challenging guys a few a working with we've So environment, for It's as know. you months. Goldman quite

fundamental know priority demonstrated have to to like. But we're it get taken would I And you time of done. time the or we more some it longer going most obviously it and a as done. as shareholder value than We're get week, it's so to little if our bit more takes last take

few upcoming So it. they in this have a hopefully faith days But deadline. some from were away

So to we size right every working hope while we are got not know day something just at make as are that it, there. we've to now as table the we're announcement far favorable that or the tax think on and to timing, form the options and that or prepared announce we an company

Fabulous. types of is of would borderless What suggest? that best the use And last, Jay, cases are unique. concept quite spectrum you the

Kyle. ahead, go So

George. Hi, Yes.

So of think where a companies rights. terrestrial operations we number have that lot multinational -- have geographies in I various are look, a there large

we have like that now And to able with through those with Qualcomm have of strategic we'll parties. so the we types collaboration ability go be partnership to a

industries, a attractive so large very be here OEMs, industries equipment all seamlessly works several that, we'll manufacturers, that including to companies, I a That's your after. solution of that think And transportation, variety is -- be different going across of will different like that mining operations.

I -- opportunity that moves -- us talked a cut the things agreement revenue. we that lease the I dollars a forward Qualcomm to ago, terrestrial said in point. last in did announced release maybe talked of off some the million about at dollars, think in millions the potential the really that effort. this many dramatically we it's some while get know process deployable. terrestrial hundreds there's, I that One of We past, spectrum we've questions that don't of this. is even But the about where several the how we that that But yesterday to we've year think we've guess, hundred think

the do world, excited that agreement a is how that This the the start to the have starts until solution offer work grow. to point of do how and ecosystem of the last in starting opportunities how going that been completely of of development is now we can today, it's can Qualcomm get the we to And that. we how, fast that ecosystem. kind the we're really see soon we'll step do do to manage inflow to I think to really whereas of we the I'm mean, where to very kind

with next from Riley Crawford Mike B. comes Our Securities. question

Just break to negotiations statement out continue geography? that earlier that on opportunity that you the you're last by terrestrial of on millions in topic Can hundreds spectrum that leases. of out, in

you do take want Jay, it? me to you or want to that take

go No, ahead, Kyle.

Yes.

States, millions it's but -- stages want global. that any too lot dollars, there get of -- to are of definitely of I would of of of it So them. we're terms don't But that to implicate various negotiation be could opportunities to a in specific different United hundreds also get in the the on

of add specific variety different number, I can't a right quite a to large various at cumulatively, opportunities stages. now. up And be they there's but So

ongoing your leased? sale given XX, do satellite be are operations Band still is the that you spectrum? satellite any of could turning to this that your -- would Or discussions Or your needs operate And business? really there with towards possible even of something these be

different leasing the Well, structured, are in There's the be all sense. us around of conversations of kind traditional the can of spectrum. the spectrum to it's that hard sell but leases lots for ways

its Anterix clarification kind middle So could qualify final any in of to there of likes that Is three stage. sort stages, you and do? of early, pipeline terms

I to feel and people then we and disappointed. often end I it's they then us like for towards feel out things we're like point. the hard mean very that it's -- this at Yes, of drag do get

-- countries. a full ecosystem. there's -- a XX So we're got We've different we have lot this -- in

to are I pipeline. to but where the don't opportunities there start of refined on I we get in kind it's a Yes. of -- too think tremendous want ahead amount are of us,

switch Okay. And then just to topics.

of So replacement constellation? can of you now throughput constellation, be share the the you've of what that power output, the the kind of any preliminary finished you'll capabilities from design review capacity characteristics expecting

Yes. the won't And there. get unfortunately, Mike, too we of many specifics into

ever continuation We technical launching have said were major of main satellite point for taking is not planning service that we risk. the of and the that on the any

time. to though, and of discussing So [DUTs] beyond not at be satellite's that's the details we're payload that, the specs and all that this going something

[Operator comes with from Jason Instructions] Bernstein Our next question Cantor.

there? a Qualcomm of Are go simply buy sell around revenues and the one new maybe sort through people cell Kyle. news. to out sort spectrum? small there and ecosystem -- is come Could couple Just actually potential to revenue you the add to lease of of I the that's come Globalstar through a -- guess questions and ecosystem the opportunity to Qualcomm? they going for Or then

Yes.

borders this a resource very them, is I working it that for works, Qualcomm look on believe. across they So ability has the And solution a to goes been a at networking way private for so complete spectrum have that as now. while to the attractive

and whatever all have with a the and work all and to the that -- the to company they're private obviously make interoperability that way all with the reach, their need you're it is us, they together. doing they're work system radios full go work, that with a and here going you the they'll engineering spectrum wanting do the to they'll global but huge to partners of chipsets will would go say, sure work, they're And sure integrator solution to make of devices then global equipment deploy. for So a network

to us to And integrators case-by-case the those work, with and system licensing so lease. do the then agreement basis a work on would

other we'll be Qualcomm. from coming equipment, from get will revenue from will the not parties, lease the is and to. revenue So from us get introduce Qualcomm revenue people selling they -- that

have MDA we that constellation on? yet? really working constellation could. Got satellite XX is larger separate that a In future the haven't it. being is -- constellation that that And the line and XX-K that ITU. it. Got a Or a one by I larger Germany Is delved say if you into more, there’s applications when accepted is the today, satellites on we the

We have at that on no this time. comment one

call look Okay. then. the next I to forward

And like Jay to now session. back to the this closing call Monroe Q&A the remarks. over for concludes I'd any turn

for this today. from others, Thank attendance all doing the analysts forward again. and appreciate We joining and you to investors, look

As we always, are for questions. available follow-up

out For those investors questions deeper asked to talking to of who today and go want to and want reach course, our always, you anytime to us.

to doing again more joining. much We soon with Thank forward look important for Thank you news. it you. very

Thank concludes you. participating. call. for This Thank conference today's you

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