NextNav (NN) 7 Aug 242024 Q2 Earnings call transcript

Thank you for standing by. My name is Erica, and I will be your conference operator today. At this time, I would like to welcome everyone to the NextNav Second Quarter 2024 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Erica Bartsch.

You may begin.

welcome Second and Conference XXXX everyone, Call. afternoon, to Quarter NextNav Earnings Good call NextNav's Mariam and on are Participating today's Sorond, NextNav's Financial Chris Chief Chief Officer. Gates, Officer; Executive

call forward-looking statements the let everyone me Reform Before Securities the within certain Act we constitute that of meaning begin, XXXX. this that statements will Private remind Litigation of include

predict, would, might, of not may, anticipate, as and statements be plan, potential, may statements, Forward-looking possible, such identify may could, statement do identified of but words by mean project, aim, expressions similar the is drive, expect, that a will these the intend, should, not use forward-looking forward-looking. believe, words absence

to and outside NextNav's Such many in known subject results the future forward-looking forecasts are to of prospects, other of materially unknown which could strategies discussed that forward-looking to may the results, uncertainties, risks, important differ are statements, from and relate factors, assumptions NextNav's actual cause developments which control future and statements. business results

are NextNav of cautioned as or made, as forward-looking result to date whether any future upon information, to the of speak reliance and statements, statements, undue which otherwise. no or forward-looking revise only commitment a update the You events new undertakes place not

factors XXXX, those Commission. For NextNav's Item reports as of on Exchange with risk the Form described as Securities filings XX, in updated the X annual the on well Part to additional the December for time company's report from other our XX-K ended year or Form otherwise Part regarding time of factors, XA information XA, Item quarterly risk X Risk Factors XX-Q and and

session. host will Following our prepared remarks, company an operator-led the question-and-answer

posted discussion company's to NextNav. Ms. call, of ahead. our of Please of to I'd to Relations go Mariam turn at a website. over addition, will the conclusion Chief Sorond, Officer call like now today's Executive the the In Investor replay be

Thank joining for us. you, and afternoon, Good Erica. thank you

ongoing will hand strategic the our towards was an filings as forward the update to process Chris other I review will to SEC vision. another with including over on as On as the quarter then our business, today, provide things I push continue It busy we highlights. well NextNav for surrounding the financials. call to our operating strategic

good business and making We in momentum seeing are progress. the tangible

this public on Notably, rulemaking issued the petition FCC standard step action seeking in rulemaking. a a comments is week, This process. NextNav's notice first FCC longer-term for the

moment, delivering solution While band. discuss I details this we the will in next spectrum of prompt notice notice is FCC's an lower a innovative steps the XXX the in step the important and public as megahertz in appreciate an

Our excited I additional past introduced of the This we presented. only strong the have vision the ecosystem by enables weeks, we into Next-Gen in confidence over investor in terrestrial opportunity speak vision, and is recent not share a for this price solution XG XD enables is integrated that additional existing GPS you of many with complement and since had a XG sentiment to and to what our also warrants. spectrum easily exercise PNT and broadband. I've am as but several in backup the with the evident

in action This business QX, in million confidence our in further warrants validates will market's of aggregate provide our X.X strategy. detail an While $XX of go-forward Chris for exchanged cash. greater the were million and

spectrum use it a public holdings security spectrum we spectrum current As to proposal combines and have GPS and issue. for spectrum focused services. our complement backup major developing what is acquired, on a the and to we addresses for a additional puts benefit Leveraging reminder, otherwise national broadband are with with followed NextNav's

to locating national things security we critical critical is daily need and complement colors emergency needs. a for and Providing GPS addressing the from backup infrastructure to safeguarding

needed much creates this band in spectrum wireless scarcity proposal abundance unleashing by from technology. Our for

our and interest consumers appropriately solutions of national protect no common-sense and can cost incumbent at benefit will operations. taxpayers These

extremely spectrum carriers long bears broadband importantly, X is that gigahertz and and is propagates scarce usable for More over below because highlighting distances. it to valuable it that penetrates walls

megahertz an contiguous for exceptional new broadband block a low-band is downlink XX opportunity. suitable having Additionally,

As has more coverage become This to deployment this strong the a spectrum also provide result, moment. will band most a way a I touch fit low PNT XG-based is buildings. on capital-efficient for our of why inside that service. in

is bandwidth, average, the Because megahertz megahertz while plus X has naturally XX MNOs X downloading or easy bigger mobile to variation most mid-band network low-band The of megahertz focus forget a have it's geographies. spectrum, expects some low-band blocks, with spectrum on have, around which big NextNav operators spectrum recent that in to XX downlink. on across X of

would an So roughly increase spectrum spectrum downlink stock additional by adding their XX downlink low-band addition of XX%, to MNO a megahertz portfolio. material an

PNT was issue is I the that opportunities economically PN sign complementary help viable This us see services. the need also the XX FCC the application A-Block that is we a acquire licenses issued PN NextNav this we from This believe urgent why a week, follows to April forward process. for powerful the address backup pleased helping by that move have in to Telesaurus. step to for widespread agreed rulemaking proposal regarding why to and It unique creates the to and you another FCC

period on stand. back things block We where XX-day the assignment good during comment received about feel only and the X request comments

Regarding developing comments has proceeding All comment and by comments reply on then position XX PN this public XX-day followed be rules. next the requested days, will the within the rulemaking, public. commission on the in proposed period. comments a for reply comments the FCC The from considers the

followed action adopting another comment then a NPRM, Notice the of and or a would commission new final expect period be by the Rulemaking for order public bank. of Proposed next rules We

subsequent public comments after not where PNR rule, general reply stand ends, notice a and happen time it good are the and a the evaluated for the comment As NPRM our to with date. take an in pleased be amount period to considerable after drafted, progress Overall, typically, feel released. of and can time NPRM comments be for things would filed, for about some to reviewed the we record

this said is have continue step a with are I the time. before, closely FCC many We plan at and one this working a As taking to focused on process. times

While that technology, test the terrestrial exciting to we simultaneously out received as GPS. of issued process complement SEC, Transportation. company's the a we that PNT delivers back solution with the some work through a purchase X, XD to announcing of a news up DOT the July awarded press PNT On a release order NextNav the was Department and

PNT from DOT plan. is comes and award its a Center the Volpe The complementary part of action

DOT PNT technology in as the technology of XXXX, cases. testing is PNT plan applicable conduct field This with use critical it's providers. in award best-performing recall, may because recognized the you technologies the with to complementary action significant NextNav's DOT's aligned all As new infrastructure

value Further, position NextNav will as largest it terrestrial awarded that dollar The leadership funding technology, PNT nearly and solution services our backup a provide award strength and XD were as we'll delivers PNT in we $X.X to the validates GPS. the NextNav's to test a from DOT. and complement in million PNT

with technology and well This the SEC. path our with program spectrum aligns

highly creates technology accurate outdoor, in XD terrestrial NextNav's including and a positioning environments, indoor urban PNT solution vertical for location. complete

GPS unavailable. as that backup Our serve solution if also a includes can is timing source

technology We in safety efforts, made economic address moves the needs. and to the that our solutions to execute also to national ensure to internally vision. partner several we've public with our right excited DOT demonstrate Complementing these to to we PNT are team security, develop have strategic capabilities and place

expansion Nickie of the of announced Directors. At the with of the Palmer career joined comes spent her the ecosystems to of majority NextNav's XG recently the development board operation Board growth. by services Nickie to XG deep and technology in products expertise development, and powered that level, advance us with we She and strategic Verizon.

leadership Chief of wireless operations serving advanced been her technologies and role's Networks. there, Head data supporting Engineering While CTO, Officer products, as Wireless engineering, and and

Nickie believe the We for she will to XXX solution band. team as megahertz lower in onboard are be and to our our vision we invaluable innovative spectrum have advance an thrilled

greater with in engineering efficiency. We reduction roughly objectives internal primarily our better operational also recently resulted structure This to our in org strategic software a our within restructured and workforce our from drive teams. align headcount, XX%

Shamsunder, our us our move Sanyogita vision. necessary that made to advance strategic we addition, to hires, background In the help we skills are help COO, forward. strategic confident and feel including also group several I have brings that powerful putting new a together

We have opportunity and the a at NextNav, here work to day. and capable strong every to thrilled team I have them with am

seeing business, are forward In can progress. our we across am the excited and that achieve solid by closing, to I momentum look all we together. I

exciting journey. ahead forward you for believe but have us, the right success. bringing We resources together of team look the work on right putting with us this are we to more to us position and I I

With things to our Chris? that, financials. let me to turn Chris over discuss

afternoon, Thanks, everyone. Mariam, and good

was from prior quarter million Next million, Nav's $X.X second revenue year period. $X.X a in $X.X million the the in increase

XXXX, the contracts including in million, For an commercial The periods in in increase service of $X.X both XXXX. and first increase the driven from with was million opportunities. revenue a and $X.X X- was million in half by increase revenue government $X.X X-month technology services from support customers, of

million additional order quarter year. we on for Operating approximately seeing and quarter period were awarded million $X.X in for and in Staying a to included July order This Transportation. anticipate as same from of were X compensation the second depreciation the Mariam of to XXXX, million recently purchase up the up noted, $X.X $XX.X X-year the revenue, of and expenses $X.X amortization compared under year. Department we topic for equity The years testing. this in the million, started option to the up $X.X order equity of the XXXX. million allow this in in from X this from second $X.X extend million months and in by depreciation extend option and the last $XX.X the the current has terms to impact compensation revenue to and million beginning third expenses quarter the in in government to amortization Operating has order

compared XXXX. million were For first half to of in million operating the year, $XX.X expenses the $XX.X

asset and loss the a operating the purchase of XXXX warrants, compared This loss the half million change which million associated net was with with $X.X a second Telesaurus the fair and first warrant with compensation quarter in agreement. $X.X loss associated is the first million, associated and million to which in fair $XX.X expense included quarter associated in value of million the stock-based depreciation net of the for of gain second liability. in Excluding XXXX. in were the $XX.X with the of of change amortization, $XX.X XXXX, the Net of liability change expenses the half of million included value loss in a $XX.X

liability, net $XX.X loss of net $XX the value including For million, fair change liability with the year, with $X.X fair net Telesaurus change was to warrant associated of the purchasing change associated first asset the the half $XX.X loss the first compared a in associated gain of in the of liability. million the with million XXXX, the with in half associated the agreement value in a loss including million of warrant of

a $XX.X with cash, investments. sheet we million quarter and balance equivalents the short-term finished in From perspective, cash

use I call. mentioned earlier cash $X.X compensation expenses payment included approximately the and to quarter Our million in of taxes the accrued restructure of for related of associated the

Our significant cash elements. balance includes also nonoperating X

XQ for As last approval asset our in use of in $X.X April call, cash of included I million 'XX agreement. of in terms the noted payment our following on purchase quarter quarter's the cash

I'm warrant for exercises warrants exercise July benefit be an additional additional highlighted, $XX following proceeds continued pleased proceeds. in an with enjoyed to million of to $X in also Mariam of XXXX, report the through XX, close the we quarter, as million And, quarter. that exercised additional million from the the $X.X in

$XX.X turn back of call million. attributed our Finally, a that, showed debt, operator. to the I'll warrants with issuance discount costs transaction value million gross And of Operator? of the sheet to of balance unamortized and with net $XX the

Your comes the line first Mouse Securities. Instructions] B. [Operator of with question from Riley Matthew

SEC you this made just megahertz from the of defer Skybridge. licenses of assignment? NextNav to give and X assignment was acquired can at I a if spectrum deny or Has decision some wondering approve, additional yet is Telesaurus regarding the color the where on

question. the for Thanks

at FCC So far. we to the actually the the not are on received point so the on updates pin automated for any that this And it, was waiting a released through did decision FCC further application, have make put but out an and process. we

question next line [indiscernible]. of from your And comes the

creating you're that an license users amateur that to Regarding an a the filings, plans, work part the are maybe like a does petition, as, mean in might of like out? and guys mean, yesterday's I on plant. to the the give there's encrypted? how plan. or a this mean ban I are obstacle to anticipating company? list far little as different the a I you color section bit users low going or or that's how have objection know maybe with pose have work? that side I what it for you let's is radio Or maybe upside unlicensed to going you're according Do say, the going filing, the of ban work to share? us of

to Yes, and it's them, actually, reasonable we Jamie, we respect and with speculate right to forward intend all through appropriate them to the the working That's the We're done going to carefully, read with PN, and going work work dialogue to where our not we're we're plan the the look wait to to parties comp. process. to comp. to now. them We comments right? really going we've with the on to stakeholders the and with and intend We're going see all to reach-outs, reply and

next my think I question.

project, Now frame also DOT of DOT it is at? be might the benchmarks the but and also are the a sort what the or the on metrics while, that, looking time

on X first to selected of a going have all, phase. out testing they've are in they awarded They the the about be. phases Will plan it, what

If maybe, their that that, the phases not, share of details. what Chris, can think you you get I offline are. some can on exactly we

to we'll some contract kind of Jamie, detail. the of come you on back that inside

questions to there Sorond to would time. for remarks. at And Mariam I like back closing further [Operator it Instructions] turn are no this

Thank you joining us all for today.

at band. see, We XXX-megahertz spectrum innovative believe you team lower can executing provide against will in work our the As hard entire our is NextNav vision. the vision unique an solution

what We are an all. Thank progress ahead, and move provide forward. we'll as lies our continue update for we excited to you on

and ladies call. gentlemen, today's you all And Thank participating. you. concludes Thank conference this for

disconnect. now may You