AST SpaceMobile Raises $1 Billion in Convertible Bonds as Shares Slide Nearly 60%
Updated
Updated · The Motley Fool · Jul 20
AST SpaceMobile Raises $1 Billion in Convertible Bonds as Shares Slide Nearly 60%
3 articles · Updated · The Motley Fool · Jul 20
Summary
$1 billion in new convertible debt gives AST SpaceMobile more funding for its satellite buildout, but the offering comes with the stock down to about $55 from peaks above $100.
Negative free cash flow of $1.37 billion over the last 12 months helps explain the raise, as the company scales manufacturing in Texas and works to deploy a constellation of 90-plus additional satellites.
Nine satellites are already in orbit, yet execution risks remain high after a recent Blue Origin mission misplaced one AST satellite and a launchpad explosion tightened payload capacity.
Competition also clouds the outlook: SpaceX, already one of AST's launch partners, is developing direct-to-device Starlink service that could rival AST's core business.
At roughly a $21 billion market value and less than $100 million in trailing 12-month revenue, the company still looks richly valued even if satellite-to-phone demand expands.