Globalstar (GSAT) 5 May 232023 Q1 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Globalstar First Quarter 2023 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.

Good morning, everyone. first very investor then brief move to Globalstar's consist which we joining directly a of opening Q&A. for quarter call XXXX will will Thanks update and fall contains securities the statements call provided laws. today's that Safe Harbor note intended Please to within the under forward-looking forward-looking its Globalstar's Form could the XXXX, SEC year filed its Report the on filings, for first XXXX described cause factors the quarter ended risk that earnings in to differ including and Factors are for the this section XX-K financial materially release. XX-Q results in statements of the of Annual week's

a As of XXXX gets from outlined XX% revenue was increase Globalstar first modest which this XXXX, the for nonrecurring Net first noncash record to an loss this breakeven. revenue total of growth XXXX. charge a over million the the loss quarter to of in close and the release, $X.X $XX in quarter our by net XX% quarter, related decreased us credit led repayment to of facility. had loss million, Even largely by driven quarter the

to we million. growth real the So future. Consistent up XXXX a we for with And robust have XXX% optimism. to of QX continue EBITDA adjusted expect versus this, cause for was foreseeable $XX

support quarter This sustainable to years space growth reflects flow repositioning significant We've terrestrial next chapter. and and of our the assets, the spent beginning our platform, both generation. cash

overhang a structure financings. with many that removed have We our years conclusion capital recent with was endured the of

our advantages end deliver creating value. applications this maximize that disruptor wholesale, IoT few solutions competitive have Furthermore, overall opportunities will Today, As plans to module, close, our we we effective to pillars, build support addressed IoT previously. allow that we a innovative can. the we will competitors plan like have legacy, user to across on products runway term we spectrum, the execute our which market of and a can drive terrestrial significant the in one us cost two launch business our year, way and market near many way to our couldn't four

have millions of We network. for capacity devices funnel utilizing satellite sales the the our potentially and

put, mode. Simply deal in we are

believe utilizing is completed since for for service deployments. in Just flexibility opportunities, The while does this a which the and to other service after United we initially to private an XX, Canada will satellite and entirely is expected a which revenue model signed all terrestrial States not long agreement or validated, lease. and our unique this engineering generate term we additive the incremental represents pursue it payments maintaining deal convert public to wireless milestone Band is analysis good and week, the agreement and our other to and is the value as significant spectrum affect our

to receive XX Canada the for close will We few weeks. Band deposit critical next private of and be a nonrefundable in deployment the also utilization a separate for expect network infrastructure. by in This

are ramping replicate discussions We tuned. two efforts represent not and closing. these and are deals the point many geographies, up exact other we in be having able so ongoing is stay of Grail, to expect to of while The type Holy this the our examples opportunity the

for on XX the with infrastructure vendors us. Qualcomm's few of yield are The will will partnership satellite side. ground incorporation the are our opportunities of handset investments into to new ongoing discussions over opportunities investments we next-gen and our in for is gained While chipsets the to major having are IoT we network market satellite our ecosystem that businesses and leverage are we significant capacity legacy still bringing now. already and the Qualcomm discuss Band we handset the driving yielding years we Furthermore, separately, made the terrestrial specifics support from unable past have direct services, significant the and to the

share shortly. more have with you to plenty We

series big Finally, in their few is despite the made cities our improvements to order in this our ever end, we've quantifiable story for nature our operations, teams are while their results, coming feel to and into we and planning management select balance this months reflected we coming focus in business us sheet. see the of more that share over properly especially directly. now substantial disruptive that combined price, our today, is our financial To roadshows tell there a of true are assets

these will shortly. and meetings about locations out We with be specifics

to up results. with the Tim you available person parts to and business our thank call are We given in remote. on advance specific well a are as Kyle your direct focusing We'll we questions now non-direct Q&A. handset the financial to Dave, along questions for Rebecca, as our of open Please me. that

Instructions] [Operator

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

Thank you.

on Band just leases. First the XX

US engineering you you be Canada show what going your in GAAP to and in to So line to statement And once income to this a how initially, in deal start or up spectrum, leasing then up going services. for is that recorded add revenue the financials? the actually are going first is

Mike, and to me, out I material that service break it it just and It'll we'll then P&L, out engineering you on you're own other, the be as a or becomes it's think ahead play exactly line of item. as but going within its yes, would step described. to

like year. spectrum. Investor these And Band not Okay. in talked they using back about and York leasing further and the Africa deals are you last were to other Day New XX? that entities at in were But just mining two the Jay, There that, seemed they elsewhere

be back And they're over And are when about such, we've that and a do those private long Investor about was at the ability particularly don't starting that private other are. network several the private critical our that prefer public would XX. term about network LTE. as impair were We when operate first talking LTE mining future that talked really a are basis on The these we over areas to talking Band Yes, in infrastructure. were some private infrastructure, LTE a what for in to talking additive to of to we to our important Day. is today nature ones of area things the or But one. will they pipeline And critical we totally expect projects of fact, a doing they're people then, the they about instead that The I of years. in XG Fi. because have long next it Wi it expect anything

more by quarter. years meaningful add quarter continue So and more will we the these think become to next up over and

Is any And from the In reason quarter one included that you. last number wholesale one in future service your there this you thank decline Okay, reported just capacity of or schedule, me. service revenue. would why quarters revenue this next? $XX,XXX,XXX year

question. Good Mike. Yes,

includes consideration before, variable service So service components agreements fixed agreements, the the under components. the explained as we've and

will $X.X to number that related the So determined would volatility a release million quarter. in to in receive called earnings prior we quarter you see first also periods of from the And quarter. we out we that

the said, components nature. out that be as might recognized next the that in piece quarter I right. as But in could quarter. are variable or following there And carved other nonrecurring be so

baseline nonrecurring every to rate. predict it's that bit item, a it's think good a absent a but for otherwise amount the call little I $X.X exact So run challenging it quarter, million,

Simon Morgan Flannery comes question Our next with from Stanley.

is service This more not with sure if just did what terms I Landon you Maybe, any maybe to, provide? taking something details morning. it revenue associated of, you a Simon. in or about sounds like talk it Good talk could you for unique is about missed Park can there relates everyone. it like for the with And it. you. there's the Jay, more Thanks any Are industry on questions, we to start able

the going end So to way, that outside fall it something drive to is high just can that. enough is of guidance or you end that comment anything just on you in increase the is of XXXX your any to low yes, or not

Sure.

per be although had we we It very This XXX% millions been First time, even and year. this a on Investor working can Day, as is, on of implementation, all, was it it. of when discussion said, the is of the tens novel in we dollars carried not over incremental.

a for is do, what become additive completely during very to $XX I today. concerned We do it work that this exactly that we little XX work how about worth doing think million the last I not engineering. will clearer that that is that, was it next XX that engineering I so the through we're should always will away so will will become so more not And yield all with entirely meaningful business hold from the Doesn't take out, very we of described that to but get can it go the to the anything it's please doing. model. payments something tight be comfortable and and as one to have We're describing. that process months that anything play and we're explain we're quarter think while. think clear else why it'll us I that engineering there's So will you through or and we

Great.

Okay, very that sounds exciting.

they're look and discussions, like really you that Band embedded terms So Qualcomm private a update things having sort with in how them as for you're where for you that presumably the ultimately out net that XX of and there customers we'll of standpoint. their offering, from a that maybe as networks can having more can on could discussions and what of what with portion what is stand look XG details us is financial relationship with and

Kyle, – will yes, you that, take do. you please would

still work. that pretty technical in They're agreement. some doing, it's Leonard Yes, days finishing early

coming to quarters. in be that done expect We the work

We have a this start have of world to the a integrators the to them this and be series group discussions weeks make we can meetings sure their started next is platform with deploy. knows and up that coming that coming that have system system other will just few the to with integrator

we're well. the about believe in is very excited Qualcomm early as excited and but very still So it, I about process, it

CapEx me, Kyle. catch think for last talk for you one And you where and payments with about about Thanks up Okay. Lab very then we balance Rocket terms MDA still the how the that guys are them? any much, can what, of year and you just just there And at Rebecca, owe additional maybe of maybe ‘XX? should are in then

Yes.

here we which MDA owe to contract. inception we million everything that So the million $XXX $XXX on is approximately date as about have paid we them, sit today,

the over contract. the can is for project rate, milestone outlined nicely. on in year. play completions that based they're of will run And depend of year track as given everything you for CapEx how the XXXX, So just balance current the will on track out the balance we're the that and But on progressing the on the

Okay. through And is $XXX quarter just end Speakers]? through that is clarify, or that the million to [Multiple

the went Yes, Yes, a MDA, funding and April, I'm in %XX of which that's pay due the so sorry. received most to we first recent to about million. prepaid right. agreement invoice was portion under that the

amount remained accrued expenses in balance sheet. the at So that

prepay million, for inflow Apple, portions, from lump that was we cash sum? the or the $XXX How about And that? the a that receiving you're think in should

funding Yes, quarters based that's or subsequent think satellite vendors. about the completions, MDA whether milestone the funding other quarterly on projected based the on needs

kind the that So we based date. needed had of as during we of that received the invoices tranche April, first incurred on

it's funding, so match Okay, of essentially. more a

of and of the of it about advance little Or think prior just and liens being kind the the payoff got things it's to day April the being ahead. first a to of theory, in had quarter that But first right. one the agreement facility happen received. bit just of administrative quarter the released quarter the in as funding being last one wonky because CapEx. otherwise, there, that That's

where person at to guys don't Great. would the and provider? contract with And Jay, but are maybe launch who I direct know to the be, you this

Tim?

Sure.

the contract So we're that months, through six through parties. pricing that have working negotiating with potential services eight on we launch for front, been the and and terms major couple of down of few or the items a agreements working partners past final structural selecting and process a to

in to down party coming launches be the us final selecting that'll and manifest ‘XX. in the the we'll the months, to give the think availability I in complete

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

customer curious, is? architecture doesn't you. architecture could existing it's is Jay, capacity, Thank that this to results. thing incremental additional your I'm opportunities, seem unique kind to of that Nice the service. this terrestrial network the that whatever impact you have relative given network

haven't world had but other without haven't else problem. we did, a could similar do the discussion We with had But those that anybody would a do if thing, of we George. parts it discussions we in yet,

you. Got

I'm Okay. timing get specific to point device, we could the of And way more use expectation to where market the two about those begin with are a wondered that. little And relative can we for just we to the the I if at cases? curious, customers

is this Dave. Yes,

rated our software also are, to we're will and we're talking fully we We Obviously, talking in and at all point come core launching fact, be two beta one way devices do. will two We end telling device that capabilities providers the with by the customers what way the service out to We're the expect at be in in year, has way that will to resellers, now. customers. new value device. also that them likely a the module of the

two the the as XXX with seeing So ways we speak. will capabilities the the launching we're we today product, STXXX already with launching they're that edge computing Integrity already latest that be

who is might see forward my that on but regulatory of It this Perfect. if to approvals? I'm the Spain and me talk to not And timing Can body. side. about this correct how other and sure regulatory tend regulatory nice move I'm belief too, forward is, to you be thinking a wrong. the They was influence address

The engineering of number process a we that Europe through any substantial countries. original went filings which the in underpin can Sure. was in effort

the several a now. places to are going with in for were the and forward forward did And process others thinking yes, We use. Spanish model provide right

they in went the for anticipate that past, in when kinds get approvals just have we others a traction that So similarly of the lot these there. we'll of Europe way

on hope So exciting and the we opportunities. of an the Europe us these the lot it's balance a there's during for of news course that time out of year, flow of

Instructions] [Operator

from question Oliver comes Our with & Delano Beck next Lyman LLC. Mack

Can fairly Brazil, in to the note on in service the I to US, has Canada you John major partner there Earlier capacity network capacity? Journal this provide of to of so, Globalstar that is hear rural the Wall someone is have eligible connectivity available seeking that, article to satellite was was full your I Street fact week an and areas, provide if wondering do that Deere me commitment now? Globalstar type your to you this percentage you a have remote like and if mentioning the coverage. the specifically provide Great. satellite do where to a large Deere, given

question, Lyman. That's a great

of involved were we yes, So, days process. in the early that

service, and to We of what and for. other that of push issue our two the service video broadband capabilities and they're Video, of is companies, the capabilities John is agricultural focused would they're looking but the Deere continue into most more for way be for streams type a which looking live broadband a like. us,

one them, with all and after data way rate likely And solution of to for others of win that typical type do And aspects water do whether it's they can provide. what bit other other not monitoring, so bid. going that course, and in marketplace probably and we're the we tank we we're management, can what low

broadband applicable not a it's what do we perspective. to So from

We have can we and playing year, of two pie part the go the in. bigger a we of there talked market yes, parts clearly in forward already. in way our smart But will product with we a is that the about late play in lot are we as activity the Ag as

Kyle. Yes, is Lyman, this

Band of in a for deployments. XX opportunities some part also there's of think those some types I to play

So if imagine could they need high bandwidth you them. services,

single a multiple or and cover put maybe If you of towers. a could it's part the large farm, big a tower farm,

to backhaul way. need in some other You it just

and there type satellite some XX Band be could So combinations services. of

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

couple of A things. Great.

is basis. finalized or room infrastructure doing a with our last conversation of with changed truly picture to XX been it's qualitative walk on everything we whether result today Band into relationship a not us. as where for First the which transformative partner a that in truly There hasn't of handset years, couple Qualcomm, radically the direct a the we've that

Samsung made control work of they chipset handset customers. of As Apple they currently Qualcomm available with. market and alone, the and course, manufacturers XX% all handset the Between large they well are to as that US

expand. been today. it has Obviously, I ecosystem the to our starts this for chapter. a are were with and a So We new us continues utilization assets. record platform The us everybody's in and questions ecosystem quarter space appreciate and now about to place our and just talking terrestrial sheet clean a entire providing runway, these it's focus the of balance unconstrained drive

ultimately sight are lose opportunities. of we that generating revenue is solutions at the about absolutely the big selected future We our have partners Our our Globalstar, fact the talking months. though why drives and in saving the you significant cash never it our reason of look mission lives. and us, at forward technology forefront market and engaging to of This driving with we're is a day. all every

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

You may now disconnect.