FORT LAUDERDALE, Fla. — Satellogic is relocating from Uruguay to the USA in a bid for more government business as revenues proceed falling wanting expectations, the publicly traded Earth remark operator announced Sept. 21.
Satellogic is currently registered within the British Virgin Islands and headquartered in Montevideo, Uruguay, meaning it shouldn’t be subject to U.S. export controls for an imagery business that recently branched into selling its dishwasher-sized satellites to other firms.
The domicile change means Satellogic would lose this export advantage it had over U.S.-based satellite suppliers, its vp of sales Luciano Giesso said throughout the South Florida Space Day conference here.
Nonetheless, it will smooth the best way for a business that currently relies on third-party arrangements with local firms to sell high-resolution multispectral imagery to the U.S. government.
Giesso said “we wish to have the option to be a serious player within the U.S. market, because we’re already good within the international market — but not so well within the U.S.”
Satellogic plans to redomicile to Delaware in the primary half of next 12 months, and has filed an application to license its constellation of 36 satellites with the U.S. National Oceanic and Atmospheric Administration (NOAA).
The corporate said during Sept. 21 earnings results that it had also appointed chief industrial officer Matt Tirman as president to guide its latest concentrate on the U.S. market.
Post-SPAC trouble
Satellogic shares have steadily declined this 12 months from a high of $4.03 in January to shut at $1.36 on Sept. 21, down 11% from the day before its earnings announcement.
While revenue increased 33% year-over-year to $3.2 million throughout the first half of 2023, it’s lagging well behind the $30 million to $50 million Satellogic forecast for the complete 12 months in December.
In a November 2021 analyst day presentation, two months before becoming a public company by merging with a special purpose acquisition company (SPAC), Satellogic projected revenue of $132 million for 2023.
Satellogic now only expects between $10 million and $20 million for 2023 after failing to win the shopper orders it had expected.
SPACs, shell firms with no prior revenues that list shares and lift money from investors hoping to seek out an investment opportunity to affix them on a public market, require less due diligence than a standard IPO.
Although SPAC mergers have helped multiple space firms raise capital lately, they proceed to underperform the stock market — and Satellogic shouldn’t be the just one to have missed near-term growth projections made to drum up investor support for going public.
AST SpaceMobile, for example, projected in its 2020 SPAC merger investor presentation that it will make $181 million in 2023 revenue from satellites that may connect standard smartphones outside cell coverage. The Midland, Texas-based company has a single advanced prototype in orbit and recently raised $115 million in debt to start deploying its first five operational satellites in 2024. The corporate has said it needs 90 satellites for full service.
Other SPAC-funded space firms falling far wanting their rosy pre-SPAC revenue projections include Astra, BlackSky, and Momentus.
Cost-cutting
Satellogic has also reduced its headcount by 25% from the beginning of 2023 to around 300 people to chop costs, and reduce the extent of money it has been burning through since raising $168 million from its SPAC merger.
The 13-year-old company ended the primary half of 2023 with $42 million in money, compared with $77 million Dec. 31.
Only moderate capital expenditures are expected within the near term, the corporate added, and it can not launch any additional satellites until early next 12 months on SpaceX’s Transporter 10 rideshare mission.
Satellogic still plans to operate a full constellation of 200 sub-meter resolution satellites in low Earth orbit to map the world each day.
Although the plan is for presidency, defense, and intelligence customers to assist finance this growing constellation, the corporate said over time it expects them to contribute lower than 20% of revenues as its industrial business picks up.
About 25 to 30 of the corporate’s employees are already based in the USA, Giesso said throughout the conference — mainly at an office in Davidson, North Carolina.
He said a location for an enlarged base within the country continues to be into consideration.
“Perhaps we’re considering more Colorado,” Giesso added.
Satellogic has also not yet announced a customer for Earth-observation satellites the corporate said in March it could sell for lower than $10 million.
The corporate had previously indicated a couple of quarter of 2023 revenues would come from this latest “space systems” business line, weighted towards the second half of this 12 months.
Rick Dunn, Satellogic’s chief financial officer, said Sept. 21 that reaching its $10 million to $20 million revenue goal for 2023 “will largely be depending on closing opportunities” throughout the space systems business.
The corporate reported a $30 million net loss for the primary half of 2023, compared with a $8 million net loss for a similar period in 2022.