Company Receives New Awards Valued up to
$780 Million
YTD Revenue Growth of 22%; Company Reaffirms
Full Year 2024 Guidance
First Gen-3 Satellite Completing Final
Pre-Ship Testing
BlackSky Technology Inc. (“BlackSky” or the “Company”) (NYSE:
BKSY) announced results for the third quarter ended September 30,
2024.
Third Quarter Financial
Highlights:
- Revenue of $22.5 million, up 6% from the prior year
quarter
- Imagery & software analytical services revenue grew 13%
over the prior year quarter
- Imagery & software analytical services cost of sales(1), as
a percent of revenue, improved to 21% from 23% in the prior year
quarter
“We delivered a strong quarter of multi-year contract bookings
valued up to $780 million, continuing to demonstrate growing demand
for our high-frequency monitoring and AI-enabled analytic
services,” said Brian E. O’Toole, BlackSky CEO. “We successfully
raised over $45 million, which has strengthened our balance sheet
and provides the capital, which we believe will fully fund our
baseline Gen-3 constellation plan. We are excited to be in the
final phases of pre-ship testing of our first Gen-3 satellite as we
ready for launch. Looking ahead, we expect to start a regular
deployment cadence of Gen-3 satellites in 2025, which will start to
unlock our next phase of growth delivering transformative
space-based intelligence solutions to customers around the
world.”
Recent Highlights
- Won a multi-year contract valued up to $290 million with the
National Geospatial-Intelligence Agency to monitor global economic
activity and military capability
- Awarded a multi-year contract with NASA valued up to $476
million to deliver time-diverse, rapid-revisit satellite imagery to
support Earth and applied science research
- Signed a six-million-dollar contract expansion with an existing
international defense sector customer to extend access to
BlackSky’s Gen-2 satellite imagery services
- Expanded product offering to provide non-Earth imaging services
and captured multiple seven-figure contracts in support of growing
space domain awareness missions worldwide
- Awarded a U.S. Navy research contract to explore applications
for advanced optical intersatellite link terminals to provide
real-time access to imagery during time-sensitive military
operations worldwide
- Successfully raised over $45 million which is expected to fully
fund the Company’s baseline Gen-3 constellation
- First Gen-3 satellite in final testing phase and expected to
ship to launch site in the next few weeks with a launch window
anticipated to open three to four weeks after shipment
- BlackSky wins 2024 Novaspace, formerly Euroconsult, Leading
Earth Observation Business Award at World Space Business Week in
Paris, an event that recognizes companies shaping the future of the
global space sector
(1)
Cost of sales is defined as imagery and
software analytical services costs and professional and engineering
services cost, less depreciation and amortization expense.
Financial Results
Revenues
Total revenue for the third quarter of 2024 was $22.5 million,
up $1.3 million, or 6%, from the third quarter of 2023. Imagery and
software analytical services revenue was $17.3 million in the third
quarter of 2024, up 13% over the prior year period, primarily
driven by incremental customer orders for BlackSky’s imagery
services. Professional and engineering services revenue was $5.3
million in the third quarter of 2024, compared to $6.0 million in
the prior year period. Professional and engineering services
contracts are milestone-based contracts that may have
quarter-over-quarter revenue variability, in contrast to the
imagery and software analytical services, which are typically
recurring subscription-based revenues.
Cost of Sales(1)
Total cost of sales as a percentage of revenue improved to 29%
for the third quarter of 2024, compared to 32% in the third quarter
of 2023. Imagery and software analytical service costs as a
percentage of revenue improved to 21% in the third quarter of 2024,
compared to 23% in the third quarter of 2023, primarily driven by
greater volumes of revenue that inherently have a low fixed-cost
structure as a percentage of revenue.
Operating Expenses
Operating expenses for the third quarter of 2024 were $29.1
million, which included $2.4 million of non-cash stock-based
compensation expense and $11.1 million in depreciation and
amortization expenses. Operating expenses for the third quarter of
2023 were $29.0 million, which included $2.3 million in non-cash
stock-based compensation expense and $11.3 million in depreciation
and amortization expenses. Excluding the non-cash stock-based
compensation and depreciation and amortization expenses from both
years, cash operating expenses(2) for the third quarter of
2024 were $15.6 million, flat compared to cash operating expenses
of $15.4 million for the third quarter of 2023.
(1)
Cost of sales is defined as imagery and
software analytical services costs and professional and engineering
services cost, less depreciation and amortization expense.
(2)
Non-GAAP financial measure. See “Non-GAAP Financial Measures” below
and reconciliation table at the end of this press release.
Net Loss/Income
Net loss for the third quarter of 2024 was $12.6 million,
compared to a net income of $0.7 million in the third quarter of
2023. The year-over-year decrease of $13.3 million was primarily
driven by fluctuations in the Company’s equity warrants and other
equity instruments that are measured at fair value and driven by
the Company’s common stock price, which resulted in changes in the
gain on derivatives.
Adjusted EBITDA(2)
Adjusted EBITDA for the third quarter of 2024 was $0.7 million,
compared to an adjusted EBITDA loss of $0.4 million in the third
quarter of 2023. The $1.1 million year-over-year improvement was
primarily driven by strong operating leverage achieved through
higher revenues and improved gross margins.
Balance Sheet & Capital Expenditures
As of September 30, 2024, cash and cash equivalents, restricted
cash, and short-term investments totaled $64.4 million. This
balance includes net equity proceeds of approximately $44.6 million
raised in the quarter, less a $10.0 million debt repayment on the
commercial bank line, which remains available to the Company should
it choose to draw on it. In addition, the Company anticipates
receiving approximately $26.7 million in payments over the next 12
months as interim milestones on a few major customer contracts are
met and expected to be billed, further enhancing the Company’s
liquidity. Capital expenditures for the third quarter of 2024 were
$13.1 million, bringing the year-to-date total capital expenditures
to $40.7 million.
2024 Outlook
BlackSky is starting to ramp up revenues from recent contract
awards and continues to work on a number of sizable new and
expansion contracts which have some degree of uncertainty
surrounding the timing of close and start of revenue recognition.
As such, the Company maintains its outlook for full year 2024
revenue of between $102 million and $118 million, and full year
2024 adjusted EBITDA of between $8 million and $16 million. In
addition, the Company maintains its expectations for full year 2024
capital expenditures of between $55 million and $65 million,
primarily driven by investments in its Gen-3 satellites.
Investment Community Conference Call
BlackSky will host a conference call and webcast for the
investment community this morning at 8:30 a.m. EST. Senior
management will review the third quarter results, discuss
BlackSky’s business, and answer questions. To access the live
webcast or the archived webcast following completion of the call,
please visit the Company’s investor relations website at
http://ir.blacksky.com and then select “News & Events” for the
link to the webcast. A presentation accompanying the webcast can
also be found on the investor relations website. To access the
conference call, participants should dial 1-800-715-9871 or
1-646-307-1963 using conference ID 8425999 or “BlackSky” at least
ten minutes prior to the start of the call. To listen to a replay
of the conference call, please dial 1-877-660-6853 or
1-201-612-7415 using access code 13749731. The audio replay will be
available from approximately 12:30 p.m. EST on November 7, 2024,
through November 21, 2024.
About BlackSky
BlackSky is a real-time, space-based intelligence company that
delivers on-demand, high-frequency imagery, analytics, and
high-frequency monitoring of the most critical and strategic
locations, economic assets, and events in the world. BlackSky owns
and operates one of the industry’s most advanced, purpose-built
commercial, real-time intelligence systems that combines the power
of the BlackSky Spectra® tasking and analytics software platform
and our proprietary low earth orbit satellite constellation.
With BlackSky, customers can see, understand and anticipate
changes for a decisive strategic advantage at the tactical edge,
and act not just fast, but first. BlackSky is trusted by some of
the most demanding U.S. and international government agencies,
commercial businesses, and organizations around the world. BlackSky
is headquartered in Herndon, VA, and is publicly traded on the New
York Stock Exchange as BKSY. To learn more, visit www.blacksky.com
and follow us on X (Twitter).
Non-GAAP Financial Measures
Adjusted EBITDA is defined as net income or loss attributable to
BlackSky before interest income, interest expense, income taxes,
depreciation and amortization, as well as significant non-cash
and/or non-recurring expenses as our management believes these
items are not as useful in evaluating the Company’s core operating
performance. These items include, but are not limited to,
stock-based compensation expense; unrealized (gain) loss on certain
warrants/shares classified as derivative liabilities; non-recurring
transaction costs; severance; litigation, settlements, and related
costs; impairment losses, income on equity method investment;
transaction costs associated with debt and equity financings; and
investment loss on short-term investments. Cash operating expenses
is defined as operating expenses less stock-based compensation
expense for selling, general, and administrative costs, and
depreciation and amortization expense. The Company believes
evaluating cash operating expenses is useful to manage expenses as
it excludes non-cash items that may obscure the underlying business
performance.
Adjusted EBITDA and cash operating expenses are non-GAAP
financial performance measures. These measures should not be
considered in isolation or as an alternative to measures determined
in accordance with GAAP. Please refer to the schedule herein and
our filings with the U.S. Securities and Exchange Commission (the
“SEC”) for a reconciliation of adjusted EBITDA to net loss, the
most comparable measure reported in accordance with GAAP, and for a
discussion of the presentation, comparability, and use of adjusted
EBITDA. Please refer to the schedule herein for a reconciliation of
cash operating expenses to operating expenses, the most comparable
measure reported in accordance with GAAP, and this press release
for a discussion of the use of cash operating expenses.
Forward-Looking Statements
Certain statements and other information included in this press
release constitute forward-looking statements under applicable
securities laws. Words such as "may", "will", "could", "should",
"would", "plan", "potential", "intend", "anticipate", "believe",
"estimate", "future", "opportunity", "will likely result", or
"expect" and other words, terms, and phrases of similar meaning are
often intended to identify forward-looking statements, although not
all forward-looking statements contain these identifying words. All
statements, other than statements of historical fact, contained in
this press release, including statements as to future performance,
our guidance outlook for the year and expected capital
expenditures, our ability to sustain revenue growth, expectations
regarding the receipt of cash from customers over the next 12
months, expectations regarding global demand for our products and
services, our anticipated liquidity and cash flows, our anticipated
Gen-3 satellite launch timing, and our expectations related to
future profitability on an adjusted basis, are forward-looking
statements.
Forward-looking statements are subject to various risks and
uncertainties, which could cause actual results to differ
materially from the anticipated results or expectations expressed
in this press release. As a result, although BlackSky's management
believes that the expectations and assumptions on which such
forward-looking statements are based are reasonable, undue reliance
should not be placed on the forward-looking statements because
BlackSky can give no assurance that they will prove to be correct.
The risks that could cause actual results to differ materially from
current expectations include, but are not limited to, factors such
as long and unpredictable sales cycles, customer demand, and our
ability to estimate resources for fixed-price contracts, expenses,
and other operational and liquidity needs, as well as the risk
factors discussed in our most recent Annual Report on Form 10-K and
other disclosures about BlackSky and its business included in
BlackSky's disclosure materials filed from time to time with the
SEC, which are available on the SEC's website at www.sec.gov or on
BlackSky's Investor Relations website at ir.blacksky.com.
The forward-looking statements contained in this press release
are expressly qualified in their entirety by the foregoing
cautionary statements. All such forward-looking statements are
based upon data available as of the date of this press release and
speak only as of such date. BlackSky disclaims any intention or
obligation to update or revise any forward-looking statements as a
result of new information or future events, except as may be
required under applicable securities law.
BLACKSKY TECHNOLOGY
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(unaudited)
(in thousands, except per
share amounts)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Revenue
Imagery & software analytical
services
$
17,276
$
15,264
$
52,578
$
46,352
Professional & engineering
services
5,273
5,996
19,145
12,632
Total revenue
22,549
21,260
71,723
58,984
Costs and expenses
Imagery & software analytical service
costs, excluding depreciation and amortization
3,682
3,479
10,559
10,634
Professional & engineering service
costs, excluding depreciation and amortization
2,968
3,288
10,006
11,137
Selling, general and administrative
17,961
17,572
54,991
55,289
Research and development
43
133
785
525
Depreciation and amortization
11,125
11,304
33,586
32,735
Total costs and expenses
35,779
35,776
109,927
110,320
Operating loss
(13,230
)
(14,516
)
(38,204
)
(51,336
)
Gain on derivatives
3,574
17,012
8,593
7,445
Income on equity method investment
—
328
—
913
Interest income
257
519
987
1,602
Interest expense
(3,142
)
(2,532
)
(8,805
)
(6,627
)
Other (expense) income, net
(22
)
2
(19
)
(1,808
)
(Loss) income before income taxes
(12,563
)
813
(37,448
)
(49,811
)
Income tax expense
(28
)
(138
)
(350
)
(260
)
Net (loss) income
(12,591
)
675
(37,798
)
(50,071
)
Other comprehensive income
—
—
—
—
Total comprehensive (loss) income
$
(12,591
)
$
675
$
(37,798
)
$
(50,071
)
Basic and diluted (loss) income per share
of common stock:
Net (loss) income per share of common
stock
$
(0.66
)
$
0.04
$
(2.05
)
$
(3.00
)
Weighted average common shares outstanding
- basic
19,120
17,360
18,394
133,465
Weighted average common shares outstanding
- diluted
19,120
17,883
18,394
133,465
BLACKSKY TECHNOLOGY
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(unaudited)
(in thousands, except par
value)
September 30, 2024
December 31, 2023
Assets
Current assets:
Cash and cash equivalents
$
56,159
$
32,815
Restricted cash
1,147
619
Short-term investments
7,090
19,697
Accounts receivable, net of allowance of
$0 and $151, respectively
10,284
7,071
Prepaid expenses and other current
assets
5,086
3,916
Contract assets
26,736
15,213
Total current assets
106,502
79,331
Property and equipment - net
46,945
67,116
Operating lease right of use assets -
net
2,559
1,630
Goodwill
9,393
9,393
Intangible assets - net
936
1,357
Satellite procurement work in process
76,504
55,976
Other assets
2,616
9,263
Total assets
$
245,455
$
224,066
Liabilities and stockholders’
equity
Current liabilities:
Accounts payable and accrued
liabilities
$
12,683
$
11,573
Amounts payable to equity method
investees
—
10,843
Contract liabilities - current
4,224
3,670
Debt - current portion
324
—
Other current liabilities
1,523
1,405
Total current liabilities
18,754
27,491
Operating lease liabilities
7,043
3,041
Derivative liabilities
6,556
15,149
Long-term debt - net of current
portion
98,427
83,502
Other liabilities
4,408
1,724
Total liabilities
135,188
130,907
Stockholders’ equity:
Class A common stock, $0.0001 par
value-authorized, 300,000 shares; issued, 30,779 and 145,232
shares; outstanding, 30,482 shares and 142,837 shares as of
September 30, 2024 and December 31, 2023, respectively.
3
2
Additional paid-in capital
747,032
692,127
Accumulated deficit
(636,768
)
(598,970
)
Total stockholders’ equity
110,267
93,159
Total liabilities and stockholders’
equity
$
245,455
$
224,066
BLACKSKY TECHNOLOGY
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Nine Months Ended September
30,
2024
2023
Cash flows from operating
activities:
Net loss
$
(37,798
)
$
(50,071
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization expense
33,586
32,735
Operating lease right of use assets
amortization
529
753
Bad debt expense
100
39
Stock-based compensation expense
8,244
7,725
Amortization of debt issuance costs and
non-cash interest expense
6,727
249
Gain on derivatives
(8,593
)
(7,445
)
Non-cash interest income
(630
)
(551
)
Loss on impairment of assets
71
—
Loss on disposal of assets
44
127
Income on equity method investment
—
(913
)
Changes in operating assets and
liabilities:
Accounts receivable
(3,313
)
359
Contract assets - current and
long-term
(5,133
)
(5,271
)
Prepaid expenses and other current
assets
(1,148
)
(13
)
Other assets
2,525
1,144
Accounts payable and accrued
liabilities
(967
)
834
Other current liabilities
194
(640
)
Contract liabilities - current and
long-term
1,005
(175
)
Other liabilities
(10
)
5,316
Net cash used in operating activities
(4,567
)
(15,798
)
Cash flows from investing
activities:
Purchase of property and equipment
(12,289
)
(12,296
)
Satellite procurement work in process
(28,410
)
(23,603
)
Purchases of short-term investments
(13,488
)
(29,167
)
Proceeds from maturities of short-term
investments
26,725
50,110
Proceeds from sale of property and
equipment
—
22
Net cash used in investing activities
(27,462
)
(14,934
)
Cash flows from financing
activities:
Proceeds from equity issuances, net of
equity issuance costs
47,343
30,868
Proceeds from issuance of debt
20,000
—
Proceeds from options exercised and ESPP
shares purchased
157
9
Debt payments
(10,000
)
—
Payments for debt issuance costs
(632
)
—
Withholding tax payments on vesting of
restricted stock units
(967
)
(972
)
Payments of transaction costs for debt
modification
—
(1,311
)
Payments of transaction costs related to
derivative liabilities
—
(905
)
Net cash provided by financing
activities
55,901
27,689
Net increase (decrease) in cash, cash
equivalents, and restricted cash
23,872
(3,043
)
Cash, cash equivalents, and restricted
cash – beginning of year
33,434
37,016
Cash, cash equivalents, and restricted
cash – end of period
$
57,306
$
33,973
BLACKSKY TECHNOLOGY
INC.
RECONCILIATION OF NET (LOSS)
INCOME TO ADJUSTED EBITDA
(unaudited)
(in thousands)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Net (loss) income
$
(12,591
)
$
675
$
(37,798
)
$
(50,071
)
Interest income
(257
)
(519
)
(987
)
(1,602
)
Interest expense
3,142
2,532
8,805
6,627
Income tax expense
28
138
350
260
Depreciation and amortization
11,125
11,304
33,586
32,735
Stock-based compensation expense
2,519
2,402
8,244
7,725
Gain on derivatives
(3,574
)
(17,012
)
(8,593
)
(7,445
)
Non-recurring transaction costs
228
—
228
—
Severance
78
363
219
562
Litigation, settlements, and related
costs
(28
)
—
137
—
Impairment losses
71
—
71
—
Income on equity method investment
—
(328
)
—
(913
)
Transaction costs associated with debt and
equity financings
—
—
—
1,738
Investment loss on short-term
investments
—
—
—
55
Adjusted EBITDA
$
741
$
(445
)
$
4,262
$
(10,329
)
BLACKSKY TECHNOLOGY
INC.
RECONCILIATION OF OPERATING
EXPENSES TO CASH OPERATING EXPENSES
(unaudited)
(in thousands)
Three Months Ended September
30,
Nine Months Ended September
30,
2024
2023
2024
2023
Operating expenses
$
29,129
$
29,009
$
89,362
$
88,549
Stock-based compensation for selling,
general and administrative costs
(2,377
)
(2,265
)
(7,747
)
(7,149
)
Depreciation and amortization
(11,125
)
(11,304
)
(33,586
)
(32,735
)
Cash operating expenses
$
15,627
$
15,440
$
48,029
$
48,665
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107467319/en/
Investor Contact Aly Bonilla VP, Investor Relations
abonilla@blacksky.com 571-591-2864
Media Contact Pauly Cabellon Senior Director, External
Communications pcabellon@blacksky.com 571-591-2865
BlackSky Technology (NYSE:BKSY)
Historical Stock Chart
From Nov 2024 to Dec 2024
BlackSky Technology (NYSE:BKSY)
Historical Stock Chart
From Dec 2023 to Dec 2024