NextNav Inc. (NASDAQ: NN) (“NextNav” or the “Company”), a leader in
next generation GPS and 3D geolocation, today reported financial
results for NextNav’s second quarter ended June 30, 2023.
Ganesh Pattabiraman, NextNav Co-founder and CEO,
stated, “We continue to see solid strategic momentum in the
business as we move into the second half of the year. We closed a
$50 million debt financing deal and subsequent to quarter end we
closed an additional $20 million investment from existing investors
increasing their commitments. This investment is a testament to the
fundamentals of our business and the favorable view the market has
of our strategic assets and future prospects. We look forward to
leveraging these funds, which provide us with multiple years of
runway, to continue executing against our business initiatives.
We were also pleased to see the FCC approve our experimental
license that allows us to validate our ability to provide highly
reliable 3D geo-location and resilient position, navigation and
timing (“PNT”) capabilities using a 5G waveform, while
simultaneously using that waveform to carry 5G broadband data.
Additionally, we are seeing significant traction in the quarter
in our underlying technology licenses as well as government grants.
Notably, we recently signed a licensing agreement with a top-tier
global chip manufacturer to provide positioning functionality to
one of their mainline chipsets and expect it to deliver initial
revenue in the second half of 2023.
We are excited by the progress we’ve made thus far in 2023 and
look forward to building more value for our shareholders going
forward.”
Recent Operational Highlights
- Closes $70 Million Debt
Financing: On July 6, 2023, NextNav closed an additional
investment of $20 million aggregated principal amount of 10.00%
Senior Secured First Lien Notes due December 2026 to a group of
lenders from its previously closed $50 million aggregate principal
amount. This brings the total gross proceeds from both rounds to
$70 million.
- Receives FCC Approval for
Experimental License Using 5G Waveform: Following second
quarter approval of its experimental license, NextNav began work on
a Bay Area network transmitting 5G waveforms to demonstrate the
ability to provide resilient PNT services combined with 5G
broadband data.
- Completed Successful Testing
of PNT Solution: In July, NextNav announced the successful
integration and testing of NextNav’s TerraPoiNT assured PNT system
with wireless carriers LTE and 5G signals to deliver accurate 3D
positioning and timing capabilities without reliance on
satellite-based GPS or GNSS signals.
- Licenses GPS Software to
Top-Tier Global Chip Manufacturer: Recently, NextNav
signed a new licensing agreement with a top-tier global chip
manufacturer that will provide positioning functionality for low
power GPS tracking to one of the manufacturer’s mainline chipsets
implementing a GPS receiver as software intellectual property. The
Company expects to begin recognizing revenue under this agreement
in the second half of 2023.
- E911/Public Safety:
On June 1, 2023, NextNav announced it was selected by a
nationwide U.S. carrier to deliver vertical location
capabilities for E911 via NextNav’s Pinnacle service. The
agreement will enable precise z-axis data – which is increasingly
critical for emergency service operations – for 911 calls made on
the carrier’s entire device portfolio, expanding the availability
of life-saving technology across the United States and
exceeding FCC z-axis / E911 requirements. The first
devices on the network utilizing the z-axis capabilities are
expected to be released later this year.
Three and Six Months Ended June 30, 2023, Financial
Highlights:
- Revenue: was $0.8
million in the three months ended June 30, 2023, as compared to
$1.4 million in the prior year period. In the six months ended June
30, 2023, revenue was $1.6 million, as compared with $2.6 million
in the prior year period. The decrease in both periods was
primarily attributable to the prior year period’s significant
upfront network integration revenue from technology and services
contracts with commercial customers.
- Operating Loss: was
$15.0 million in the three months ended June 30, 2023, as compared
to an operating loss of $17.0 million in the prior year period. In
the six months ended June 30, 2023, operating loss was $29.0
million, as compared to $33.1 million in the prior year
period.
- Net Loss: was $15.8
million in the three months ended June 30, 2023, as compared to a
net income of $0.8 million in the prior year period. In the six
months ended June 30, 2023, net loss was $32.1 million, as compared
to a net loss of $8.9 million in the prior year period.
- Balance Sheet: as
of June 30, 2023, the Company had $52.8 million in cash and cash
equivalents, $32.2 million in short term investments and has $34
million in debt net of unamortized discount attributed to
transaction costs and the issuance of warrants, with a gross value
of $50 million notes from the recently announced debt financing
deal.
Conference Call Information
NextNav will host a conference call for analysts and investors
at 5:00 PM ET on August 9, 2023, to discuss its financial results
for the second quarter 2023 and business outlook. To access the
call, please register by visiting the following website:
https://conferencingportals.com/event/TSgreOeK
Upon registering, each participant will be provided with call
details and a registrant ID.
NextNav is also providing an investor relations presentation
with information on its business and operations, which is available
in the investor relations section of the NextNav website at
https://ir.nextnav.com.
A replay of the call can also be accessed via phone through
August 16, 2023, by dialing by dialing (800) 770-2030 from the
U.S., or (647) 362-9199 from outside the U.S. The conference I.D.
number is 62936.
About NextNav Inc.
NextNav Inc. (Nasdaq: NN) is a leader in next generation GPS,
built on a robust asset platform, including 8MHz of wireless
spectrum in the 900MHz band with near-nationwide coverage,
intellectual property and deployed network systems. The company's
Pinnacle network delivers highly accurate vertical positioning to
transform location services, reflecting the 3D world around us and
supporting innovative, new capabilities. NextNav's TerraPoiNT
network delivers accurate, reliable, and resilient 3D positioning,
navigation and timing (PNT) services to support critical
infrastructure and other GPS-reliant systems in the absence or
failure of GPS.
For more information, please visit https://nextnav.com/ or
follow NextNav on Twitter or LinkedIn.
Forward Looking Statements
This press release contains “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include, but are not
limited to, statements regarding our management team’s
expectations, hopes, beliefs, intentions or strategies regarding
the future, projections, forecasts or other characterizations of
future events or circumstances, including any underlying
assumptions, and are not guarantees of future performance. The
words “may,” “anticipate,” “believe,” “expect,” “intend,” “might,”
“plan,” “possible,” “potential,” “aim,” “strive,” “predict,”
“project,” “should,” “could,” “would,” “will” and similar
expressions may identify forward-looking statements, but the
absence of these words does not mean that a statement is not
forward-looking. These statements may relate to, but are not
limited to: expectations regarding our strategies and future
financial performance, including future business plans or
objectives, expected functionality of our geolocation services,
anticipated timing and level of deployment of our services,
anticipated demand and acceptance of our services, prospective
performance and commercial opportunities and competitors, the
timing of obtaining regulatory approvals commercial partnership
acquisition and retention, products and services, pricing,
marketing plans; our ability to realize the anticipated technical
and business benefits associated acquisitions, and any subsequent
mergers, acquisitions, or other similar transactions; factors
relating to our future operations, projected capital resources and
financial position, estimated revenue and losses, projected costs
and capital expenditures, and expectations about international
markets; projections of market growth and size, including the level
of market acceptance for our services; our ability to adequately
protect key intellectual property rights or proprietary technology;
our ability to maintain our Location and Monitoring Service (“LMS”)
licenses and obtain additional LMS licenses as necessary; our
ability to maintain adequate operational financial resources,
including for research and development, or raise additional capital
or generate sufficient cash flows; our ability to develop and
maintain effective internal controls; our success in recruiting
and/or retaining officers, key employees or directors; expansion
plans and opportunities; costs related to being a public company;
our ability to maintain the listing of our securities on Nasdaq;
macroeconomic factors and their effects on our operations; and the
outcome of any known and unknown litigation and regulatory
proceedings, as well as assumptions relating to the
foregoing.
Accordingly, forward-looking statements should
not be relied upon as representing our views of any subsequent
date, and we do not undertake any obligation to update or revise
any forward-looking statements to reflect events or circumstances
after the date they were made, whether as a result of new
information, future events or otherwise, except as may be required
under applicable securities laws.
Source: NN-FIN
Contact:
Erica BartschSloane & Companyebartsch@sloanepr.com
NEXTNAV INC.CONDENSED
CONSOLIDATED BALANCE SHEETS(IN THOUSANDS, EXCEPT
SHARE DATA)
|
|
June 30, 2023 (unaudited) |
|
|
December 31, 2022 |
|
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
52,784 |
|
|
$ |
47,230 |
|
Short term investments |
|
|
32,228 |
|
|
|
8,216 |
|
Accounts receivable |
|
|
1,830 |
|
|
|
2,168 |
|
Other current assets |
|
|
2,933 |
|
|
|
3,576 |
|
Total current assets |
|
$ |
89,775 |
|
|
$ |
61,190 |
|
Network under construction |
|
|
2,147 |
|
|
|
3,574 |
|
Property and equipment, net of accumulated depreciation of
$7,759 and $5,971 at June 30, 2023 and December 31, 2022,
respectively |
|
|
20,938 |
|
|
|
19,180 |
|
Operating lease right-of-use assets |
|
|
18,602 |
|
|
|
10,143 |
|
Goodwill |
|
|
17,739 |
|
|
|
17,493 |
|
Intangible assets |
|
|
10,615 |
|
|
|
10,397 |
|
Other assets |
|
|
1,652 |
|
|
|
1,811 |
|
Total assets |
|
$ |
161,468 |
|
|
$ |
123,788 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
879 |
|
|
$ |
1,019 |
|
Accrued expenses and other current liabilities |
|
|
5,976 |
|
|
|
5,241 |
|
Operating lease current liabilities |
|
|
2,757 |
|
|
|
2,532 |
|
Deferred revenue |
|
|
64 |
|
|
|
95 |
|
Total current liabilities |
|
$ |
9,676 |
|
|
$ |
8,887 |
|
Warrants |
|
|
7,263 |
|
|
|
4,200 |
|
Operating lease noncurrent liabilities |
|
|
13,762 |
|
|
|
5,290 |
|
Other long-term liabilities |
|
|
1,647 |
|
|
|
1,547 |
|
Long term debt, net of debt issuance cost and discount |
|
|
34,042 |
|
|
|
— |
|
Total liabilities |
|
$ |
66,390 |
|
|
$ |
19,924 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Common stock, authorized 500,000,000 shares; 108,185,714 and
106,418,442 shares issued and 108,184,537 and 106,417,265 shares
outstanding at June 30, 2023 and December 31, 2022,
respectively |
|
|
12 |
|
|
|
12 |
|
Additional paid-in capital |
|
|
810,011 |
|
|
|
787,130 |
|
Accumulated other comprehensive income |
|
|
1,823 |
|
|
|
1,371 |
|
Accumulated deficit |
|
|
(720,611 |
) |
|
|
(688,492 |
) |
Common stock in treasury, at cost; 1,177 shares at June 30, 2023
and December 31, 2022 |
|
|
(4 |
) |
|
|
(4 |
) |
Total stockholders’ equity |
|
$ |
91,231 |
|
|
$ |
100,017 |
|
Non-controlling interests |
|
|
3,847 |
|
|
|
3,847 |
|
Total liabilities and stockholders’ equity |
|
$ |
161,468 |
|
|
$ |
123,788 |
|
|
|
|
|
|
|
|
|
|
NEXTNAV INC.CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
LOSS(UNAUDITED)(IN THOUSANDS,
EXCEPT PER SHARE AMOUNTS)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Revenue |
|
$ |
800 |
|
|
$ |
1,421 |
|
|
$ |
1,630 |
|
|
$ |
2,620 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold (exclusive of depreciation and
amortization) |
|
|
3,142 |
|
|
|
3,001 |
|
|
|
6,165 |
|
|
|
6,038 |
|
Research and development |
|
|
4,994 |
|
|
|
4,170 |
|
|
|
9,572 |
|
|
|
8,158 |
|
Selling, general and administrative |
|
|
6,516 |
|
|
|
10,382 |
|
|
|
12,570 |
|
|
|
19,722 |
|
Depreciation and amortization |
|
|
1,178 |
|
|
|
884 |
|
|
|
2,303 |
|
|
|
1,766 |
|
Total operating
expenses |
|
$ |
15,830 |
|
|
$ |
18,437 |
|
|
$ |
30,610 |
|
|
$ |
35,684 |
|
Operating
loss |
|
$ |
(15,030 |
) |
|
$ |
(17,016 |
) |
|
$ |
(28,980 |
) |
|
$ |
(33,064 |
) |
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense) |
|
|
(343 |
) |
|
|
109 |
|
|
|
126 |
|
|
|
109 |
|
Change in fair value of warrants |
|
|
(263 |
) |
|
|
17,763 |
|
|
|
(3,063 |
) |
|
|
24,150 |
|
Other income (loss) |
|
|
14 |
|
|
|
(37 |
) |
|
|
(67 |
) |
|
|
(53 |
) |
Income (loss) before
income taxes |
|
$ |
(15,622 |
) |
|
$ |
819 |
|
|
$ |
(31,984 |
) |
|
$ |
(8,858 |
) |
Benefit (Provision) for income taxes |
|
|
(148 |
) |
|
|
8 |
|
|
|
(135 |
) |
|
|
(26 |
) |
Net income
(loss) |
|
$ |
(15,770 |
) |
|
$ |
827 |
|
|
$ |
(32,119 |
) |
|
$ |
(8,884 |
) |
Foreign currency translation adjustment |
|
|
20 |
|
|
|
(9 |
) |
|
|
452 |
|
|
|
(22 |
) |
Comprehensive income
(loss) |
|
$ |
(15,750 |
) |
|
$ |
818 |
|
|
$ |
(31,667 |
) |
|
$ |
(8,906 |
) |
Net income
(loss) |
|
$ |
(15,770 |
) |
|
$ |
827 |
|
|
$ |
(32,119 |
) |
|
$ |
(8,884 |
) |
Net income (loss)
attributable to common stockholders |
|
$ |
(15,770 |
) |
|
$ |
827 |
|
|
$ |
(32,119 |
) |
|
$ |
(8,884 |
) |
Weighted average of shares
outstanding – basic |
|
|
106,749 |
|
|
|
101,071 |
|
|
|
106,951 |
|
|
|
99,886 |
|
Weighted average
of shares outstanding – diluted |
|
|
106,749 |
|
|
|
102,381 |
|
|
|
106,951 |
|
|
|
99,886 |
|
Net income (loss)
attributable to common stockholders per share - basic |
|
$ |
(0.15 |
) |
|
$ |
0.01 |
|
|
$ |
(0.30 |
) |
|
$ |
(0.09 |
) |
Net income (loss)
attributable to common stockholders per share -
diluted |
|
$ |
(0.15 |
) |
|
$ |
0.01 |
|
|
$ |
(0.30 |
) |
|
$ |
(0.09 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NEXTNAV INC.CONDENSED
CONSOLIDATED STATEMENTS OF CASH
FLOWS(UNAUDITED)(IN
THOUSANDS)
|
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
2022 |
|
Operating
activities |
|
|
|
|
|
|
Net loss |
|
$ |
(32,119 |
) |
|
$ |
(8,884 |
) |
Adjustments to reconcile net
loss to net cash used in operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
2,303 |
|
|
|
1,766 |
|
Equity-based compensation |
|
|
8,236 |
|
|
|
13,958 |
|
Change in fair value of warranty liability |
|
|
3,063 |
|
|
|
(24,150 |
) |
Realized and unrealized gain on marketable securities |
|
|
(191 |
) |
|
|
— |
|
Equity method investment loss |
|
|
86 |
|
|
|
— |
|
Asset retirement obligation accretion |
|
|
33 |
|
|
|
26 |
|
Amortization of debt discount |
|
|
480 |
|
|
|
— |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
338 |
|
|
|
769 |
|
Other current assets |
|
|
655 |
|
|
|
1,647 |
|
Other assets |
|
|
75 |
|
|
|
56 |
|
Accounts payable |
|
|
(140 |
) |
|
|
(11 |
) |
Deferred revenue |
|
|
(31 |
) |
|
|
(1,622 |
) |
Accrued expenses and other liabilities |
|
|
1,054 |
|
|
|
(597 |
) |
Operating lease right-of-use assets and liabilities |
|
|
239 |
|
|
|
268 |
|
Net cash used in operating
activities |
|
$ |
(15,919 |
) |
|
$ |
(16,774 |
) |
|
|
|
|
|
|
|
|
|
Investing
activities |
|
|
|
|
|
|
|
|
Capitalization of costs and purchases of network assets, property,
and equipment |
|
|
(2,333 |
) |
|
|
(634 |
) |
Purchase of marketable securities |
|
|
(30,534 |
) |
|
|
— |
|
Sale and maturity of marketable securities |
|
|
6,713 |
|
|
|
— |
|
Purchase of internal use software |
|
|
(505 |
) |
|
|
(151 |
) |
Net cash used in investing
activities |
|
$ |
(26,659 |
) |
|
$ |
(785 |
) |
|
|
|
|
|
|
|
|
|
Financing
activities |
|
|
|
|
|
|
|
|
Proceeds from senior secured notes |
|
|
50,000 |
|
|
|
— |
|
Payments towards debt issuance cost |
|
|
(1,838 |
) |
|
|
— |
|
Payments towards debt |
|
|
(55 |
) |
|
|
— |
|
Proceeds from exercise of stock options |
|
|
39 |
|
|
|
48 |
|
Repurchase of common stocks (withholding taxes) |
|
|
— |
|
|
|
(1 |
) |
Net cash provided by financing
activities |
|
$ |
48,146 |
|
|
$ |
47 |
|
Effect of exchange rates on
cash and cash equivalents |
|
|
(14 |
) |
|
|
(42 |
) |
Net decrease in cash and cash
equivalents |
|
|
5,554 |
|
|
|
(17,554 |
) |
Cash and cash equivalents at
beginning of period |
|
|
47,230 |
|
|
|
100,076 |
|
Cash and cash equivalents at
end of period |
|
$ |
52,784 |
|
|
$ |
82,522 |
|
|
|
|
|
|
|
|
|
|
Non-cash financing
information |
|
|
|
|
|
|
|
|
Capital expenditure included
in accounts payable |
|
$ |
225 |
|
|
$ |
501 |
|
Issuance of warrants |
|
$ |
14,598 |
|
|
$ |
— |
|
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