MIDLAND, Texas - AST SpaceMobile, Inc. (NASDAQ: ASTS), which is developing a space-based cellular broadband network, announced today a strategic partnership with Verizon (NYSE:VZ). This collaboration follows a previous agreement with AT&T, aiming to provide 100% geographical cellular coverage across the continental United States.
The company plans to use the 850 MHz low-band spectrum shared by AT&T and Verizon to facilitate nationwide satellite coverage. This spectrum is known for its signal penetration and coverage capabilities, which are expected to minimize connectivity dead zones and provide a consistent mobile experience.
The partnership is part of AST SpaceMobile's broader goal to bridge the digital divide by enabling access to essential communication services for everyone, everywhere. The company's innovative ASIC architecture and the deployment of the largest commercial communications satellite in low Earth orbit are central to this plan. These satellites are designed to connect directly with standard smartphones without the need for specialized equipment.
AST SpaceMobile's Chairman and CEO, Abel Avellan, expressed the significance of the partnership, emphasizing the combined efforts of AST SpaceMobile, AT&T, and Verizon to create a solution that benefits consumers, businesses, and rural communities.
The company has established partnerships with more than 45 mobile network operators, including Vodafone (NASDAQ:VOD), Rakuten, Google (NASDAQ:GOOGL), and American Tower (NYSE:AMT), serving over 2.8 billion subscribers. These alliances are seen as crucial steps toward achieving AST SpaceMobile's mission of global connectivity.
AST SpaceMobile also highlighted the potential of its Next Generation BlueBird satellites, which are expected to offer a tenfold improvement in processing bandwidth, thanks to their novel, AI-ready, custom, and low-power architecture.
This partnership announcement is based on a press release statement from AST SpaceMobile, Inc.
In other recent news, AST SpaceMobile, a pioneer in space-based cellular broadband networks, has made significant strides in its growth and commercialization phase. The company announced a strategic reshuffling of its executive team, with Scott Wisniewski transitioning from Chief Strategy Officer to President, Shanti Gupta moving from Chief Accounting Officer to Chief Operations Officer, and Andrew Johnson taking on the dual role of Chief Financial Officer and Chief Legal Officer.
In addition, AST SpaceMobile reported $31.1 million in non-GAAP adjusted cash operating expenses for the quarter, with a cash balance of $212.4 million. The company is also preparing to launch its first five Block 1 satellites in mid-2024. Despite these developments, the company has not yet provided specific revenue guidance for the first five satellites and is still in the early stages of securing necessary financing.
Analyst firms UBS and Scotiabank have expressed optimism about AST SpaceMobile's future, with UBS projecting revenues of $1.1 billion and an EBITDA margin of approximately 60% by 2028. Both firms have raised their price targets for the company, reflecting their confidence in AST SpaceMobile's prospects.
InvestingPro Insights
Amidst the strategic partnership announcements, AST SpaceMobile, Inc. (NASDAQ: ASTS) remains a company under keen investor scrutiny. With an adjusted market capitalization of approximately $1.67 billion, the company is navigating through a transformative phase. An InvestingPro Tip highlights that AST SpaceMobile holds more cash than debt on its balance sheet, a positive sign for investors concerned about the company's financial health. This is particularly noteworthy as the company is also quickly burning through cash, a dynamic investors should monitor closely.
From a performance perspective, AST SpaceMobile has experienced a significant return over the last week, with a 12.39% price total return, and an even more impressive 40.3% return over the past month. These metrics underscore the company's high price volatility, which is echoed by an InvestingPro Tip that notes the stock's tendency to trade with substantial price fluctuations.
Despite these short-term gains, the company's long-term financials present a mixed picture. The P/E ratio stands at a negative 12.11, reflecting market skepticism about future earnings. Additionally, the company's revenue for the last twelve months as of Q1 2024 was a mere $0.5 million, a sharp decline of 95.63% from the previous period. This drastic revenue drop aligns with an InvestingPro Tip that suggests analysts do not anticipate AST SpaceMobile will be profitable this year.
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