Latest / AST SpaceMobile Podcast / Kook's Weekly - March 22 - The SpaceMob Slingshot: Trillion-Dollar Math and the AI Frontier

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Kook's Weekly - March 22 - The SpaceMob Slingshot: Trillion-Dollar Math and the AI Frontier · AST SpaceMobile Podcast

0:06
This is the AST Space Mobile podcast.
0:11
Just basically from the phone, be seamless, regardless of where
0:14
you are. You don't want the user even to
0:16
know that it's connected by satellite.
0:21
Listen, the opportunity that we have is very, very, very large.
0:27
All right. Good evening, everyone.
0:29
Hope everyone had had a busy, busy weekend.
0:33
I certainly did. So while other people are
0:37
monitoring the situation and seemingly just adding activity
0:40
to their life, I've just tried to check out.
0:43
And so my belief is all these sorts of macro Tempest tend to
0:48
be, for one, incredibly confusing if you try to make
0:54
sense of them, but then also kind of just like not
0:57
productive. And so depending on what your
0:59
strategy is right now, I'm looking at the S&P down 3030
1:04
bips overnight and it was Marines on the way, yadda,
1:09
yadda, yadda. And So what is this really going
1:13
to cause me to change? Really nothing.
1:16
Because the world will probably still go on increasingly so
1:20
because there's no nukes and I ran.
1:23
And so I just AM, it's kind of adding to what I want to add.
1:28
And so the things that I've I've been doing is I've been adding
1:31
some of what I call torques for Asts, which is a little bit of a
1:36
complicated option strategy just to overlay on top of my core
1:40
position until what I call a torque.
1:44
I, I don't know if there's like a better name for it, but I sell
1:47
a put spread in it in order to buy calls.
1:51
And so then I kept my downside. So you're, you're really buying
1:56
long stock risk, it's just you don't attach to a higher strike.
2:00
So I've been doing some of that and then buying S&P 500 and then
2:06
another name which I think some other guys might start talking
2:09
about pretty soon, but I don't, I just want to stay as a ASTS
2:13
only account by and large. But I do a little bit of other
2:17
stuff around the edges, which is usually pretty small, usually
2:19
less than 1% of my ASTS position.
2:22
But weeks like last week and you know what, what it's looking
2:27
like for next week or good weeks, just to make sure you
2:29
know what you own, make sure you have the right balance sheet.
2:32
So try not to be very levered or have short term calls.
2:36
In my humble opinion, those are tough things.
2:39
And then just keep an eye on what we're going to be having
2:43
over the next couple months. And so let's just start off with
2:48
ironically, Texas Hedge suggestion from a Swedish cat.
2:53
It's like this, you even know what a Texas hedge is.
2:55
Come on. And so points out, well, let's
2:59
look at what this market looks like.
3:01
And so we have the Starlink IPO around the horizon.
3:05
That's not rumored to, I don't know, it's rumored, but
3:07
Polymarket is saying it's going to be a $2 trillion IPO.
3:12
Great. And increasingly, it looks like
3:16
it's a duopoly with ASTS and SpaceX.
3:20
Now that's going to get a little bit more complicated when we
3:22
parse it out because you're going to have Kuiper.
3:26
And so you have to start to define each market.
3:29
And so SpaceX plays in the launch market, if you are
3:34
unaware, and they play in the fixed broadband market, which is
3:40
their Starling core Starling product.
3:42
Then they have a little bit of toehold, which I'm sure is kind
3:45
of nothing in terms of revenue for them on their D to C
3:49
opportunity. And then I'm sure there's other
3:52
ways they make money. But when thinking about the DTC,
3:56
by all practical accounts, it's a, it's a duopoly with AST space
3:59
mobile and and SpaceX. And what's tricky for SpaceX is
4:06
that Asts should be someone easily able to move in to fix
4:11
broadband at the time and place of their choosing.
4:16
How they'll sell it remains to be seen whether they go direct
4:19
to consumer or whether they sell through their M&O partners.
4:22
But the reverse is a more difficult argument where it's
4:25
going to be very difficult for SpaceX to do much more than
4:28
they've already done in the DTC market because it relies on the
4:32
M and OS. We'll see how that Echostar
4:35
spectrum plays out for them, but you kind of have one way
4:41
optionality on ASTS eating into Spacex's satellite lunch, but
4:47
somewhat limited from what I can, you know, really say
4:51
genuinely, I feel like we've seen all the cards that those
4:55
guys could play. They have whatever they have
4:57
3500 satellites up and all the time in the world to have stolen
5:03
all of ASTSS customers and they haven't done and ASTS has been
5:08
delayed and, and still the you know, the bullet bounced off the
5:16
armor. And so now we're about to see
5:18
what happens when, you know, David wakes up and gets his
5:22
slingshot out and that is coming.
5:26
And so skipping around a little bit in terms of events, but
5:29
we're going to have batch one probably ship in April or May.
5:34
And that is the infamous Constellation Constipation that
5:37
I've been wrong about in terms of when they would be able to
5:42
flush their satellite intestines into the great toilet of
5:46
opportunity. So this stuff, I, I don't know.
5:48
This is why you shouldn't do ad hoc spaces because then you say
5:53
stuff like that, but they are going to have like a Japanese
5:58
toilet Toto type opportunity when they actually are able to
6:03
start shipping these. And at that point the
6:05
optionality of Asts going into Space XS market is going to
6:10
become more real. So now let's go back to our
6:12
Swedish cat who has the audacity to suggest something like a
6:16
Texas hedge. And so we have the Starlink IPO
6:20
that's going to be at round about 40 times the price of AST
6:25
space mobile may be worth it. And if you're a investor, which
6:29
I hope hope people on this call are, if, if it's not that hard
6:36
just to buy the whole opportunity, just buy the whole
6:38
opportunity, that's called buying the strip.
6:40
And so if you're a distressed investor, for example, and let's
6:43
say you own a bunch of bank debt, secured bank debt, well,
6:47
you're kind of guessing what's called where the fulcrum is.
6:49
And if the value cuts a little higher, you might get part out
6:53
or reinstated, in which case you don't end up owning the the
6:56
bankrupt entity, which is your goal.
6:58
So what do you do? You buy some of the unsecured
7:00
bonds as a hedge in a way, like if the value cuts a little
7:03
higher, make sure you can still control the process through the
7:06
the unsecured's. Well, then what else do you do?
7:09
We can buy some equity in bankruptcy, as odd as that might
7:12
sound, but it's really smart if all of a sudden the unsecured's
7:16
are trading, you know, around about 70 cents or something,
7:19
start buying the equity as your hedge.
7:22
And ASTS is a very obvious hedge for someone who does the work
7:26
and identifies like this is big, this being the market.
7:31
And when you have something that's going to potentially
7:33
trade at a $2 trillion market cap and then you have this other
7:36
thing at 40 billion, you know, a little less than that, it's kind
7:42
of nothing. It's 2%.
7:46
And so why would you not just buy some ASTS if you if you were
7:50
all gung ho on SpaceX, why in the world would you not ratio in
7:53
some ASTF space mobile just to catch that value to the extent
7:58
that the value of the market cuts higher?
8:00
So the same logic as to why a secure bank debt lenders in
8:03
bankruptcy. So like the Apollo's of the
8:05
world, the Cerberuses and the Aries of the world, the same
8:09
logic, the guys that are buying bank debt with an intent to
8:11
basically crammed down a company and take it to buy and they buy
8:15
the, the, the bankrupt equity. That's the same logic that some
8:20
investors might have on ASTS for the guys that are only doing the
8:23
maybe 7 1/2 minutes of diligence.
8:25
So they've obviously done more than 5 minutes of diligence, but
8:28
at 7 1/2 they go well, huh, Texas Hatch.
8:31
And then if they take the red pill and they start, you know,
8:37
reading the pin DD doc, that's when they might do something
8:41
else. And you're talking to a guy who
8:43
did something else, which is by an institutional level stake in
8:47
a pre revenue company. But that's what happens when you
8:51
have the conviction, you start to go, well, this is the thing
8:54
that should be a trillion dollar market cap because that's my
8:55
belief. So it's very interesting.
8:58
But then I was having a debate with a SpaceX holder the other
9:01
day and he's a good friend of mine actually.
9:04
And he's made a lot of money on SpaceX, but these guys haven't
9:06
had to do a lot of work on DTC. And so I kept telling him I
9:10
said, Hey, buddy, you know, make sure you take a print because
9:13
we're coming for you. You know, I, I hate to, you
9:15
know, it's like I hate to tell you, but we will bankrupt you,
9:19
which we won't. But you know, trying to be a
9:21
little sensational was to scare him a little bit.
9:23
So he did some quick work, went on Twitter, saw some of the
9:26
slides from Mobile World Congress that showed SpaceX had
9:31
whatever it was 35 DA signed and 600 million Subs and sent it
9:36
back to me and went well, looks like they're doing just great.
9:39
Like what? What are you talking about with
9:40
the CSC space mobile? And my point was OK, so this pre
9:45
revenue shitco as 50-DA MOUS and six times is number the number
9:54
of Subs and captured by those MO us and DAS 6 times.
10:02
So over 3 billion people captured by that.
10:07
Is that not a wake up call because the story behind SpaceX
10:10
is dominant space monopoly. Well, that's not what the
10:14
numbers are showing for this segment, D to C And I just go
10:18
back to any anyone that is familiar with the Facebook
10:23
analog of desktop versus mobile, you just have to bet on mobile.
10:27
And so ASTS is trouncing the competition in mobile before
10:33
they've even started. And most reasonable people would
10:37
assume that mobile is is going to be the bigger market.
10:39
Seems like a a good bet. The bet's not priced for that
10:43
statement. And so that's where this
10:44
convexity, the upside comes. It gets me really, really
10:46
excited even when other people are monitoring the situation and
10:51
worried about the S&P gapping down.
10:52
Like, give me a break. The the Marines are about to
10:55
land on Karg Island. And as someone who has spent
10:59
some time with the Marine Corps, just run, I mean that that that
11:04
would be like the dominant strategy.
11:06
If I'm an Iranian soldier, I'd see these guys come in and I
11:09
would very quickly set a world record for a steeplechase
11:15
distance run getting the hell out of there.
11:18
And so I just still feel like we're just a couple weeks and
11:23
this Iran stuff is in the rearview mirror.
11:25
And so making long term decisions about things that are
11:29
frankly levered to this entire situation in Iran, the, the
11:33
whole world should be waking up to the changing nature of
11:37
electronic warfare, denial of GPS, things like this.
11:42
So the, the stocks should be going up.
11:44
I don't know who in the world would be selling defense
11:47
companies right now when Hex F is trying to go or actually
11:51
Steve Feinberg is trying to hire bankers to deploy $200 billion.
11:55
And literally all of my friends are trying to get jobs at
11:58
Andoril. This is the place to be.
12:00
And so the, the idea that these things trade off is, is
12:04
preposterous to me. But in any respect, just always
12:06
think like what's going to happen in six months?
12:08
And so in six months from now, we're going to be leading up to
12:11
the midterms. There's going to be, you know,
12:13
people will be, they'll be back to school season, things like
12:17
that. The acute nature of whether the
12:21
Strait of Hormuz is, is shot, which it probably won't be, will
12:24
be long since past. And that's when you got to
12:27
remember at least where, well, you don't have to do anything.
12:29
But what I always tell myself is remember how to think long term.
12:33
And so then let's check in with this account, CK Capital.
12:38
And they say ASTS has a path to becoming a trillion dollar
12:41
company. And the math isn't complicated.
12:43
Well, OK, sure, but it's a little complicated.
12:47
But they do a good job dumbing it down.
12:49
So they look at the SpaceX math, so the Subs and the revenue, and
12:56
then point out that ASTS is pointing toward 5 billion
13:01
subscribers as opposed to SpaceX with 10 million.
13:05
Now there's a difference in ARPU, but there's also some
13:09
other differences in terms of the Super wholesale market and
13:13
things like that. And so this individual goes and
13:16
says, well, a billion Subs at $5 per month is $60 billion in
13:19
annual revenue. And that's 20% attach rate.
13:24
We don't know the right answer, but that doesn't seem totally
13:28
unrealistic to me. And so then he says, well, at 15
13:32
times revenue, that's $900 billion market gap.
13:34
At 20 times revenue, that's 1.2 trillion.
13:37
And meanwhile, Starlink is trading at 120 times revenue,
13:41
which is clearly just reflecting incredible growth expectations.
13:44
No one's saying that 120 times revenue is a stable valuation
13:49
metric for SpaceX. Kind of like how Snowflake was
13:53
trading at 100 times revenue. That was based on a lot of
13:56
growth. And then the problem is when
13:57
something gets a lot more competitive pressure and, you
14:01
know, things like that, or the growth doesn't materialize,
14:03
That's when a stock can kind of trade poorly over the next
14:05
years. Who knows what happened with
14:07
SpaceX, but you can really paint an exciting picture.
14:12
So read, read that. It's a good tweet to read.
14:15
Looks like he got an incredible amount of engagement, unless you
14:17
can give him a like right now. 276 likes.
14:22
So the math is there, which is always really important to do,
14:26
like we call the owner's math. And so if you think like an
14:29
owner, you're going to actually do your calculations on a
14:31
napkin, not in a spreadsheet because you really just want to
14:35
know what your true north is. And then you put your head down
14:38
and you and you get back to cooking.
14:40
I would find it very surprising if a Bell is spending a lot of
14:42
time doing a detailed DCF of his company as opposed to just kind
14:47
of knowing I have 5 billion Subs.
14:49
I need to have the best service possible to have the highest
14:53
attach rate possible and generate something that is so
14:56
clearly valuable to the consumer that I get a lot of value
14:59
capture against that. That would be my math if I were
15:04
someone like a Bell. And what I would also be focused
15:07
on is grabbing the talent to make it happen.
15:11
On that note, ASTS hired a chief of artificial intelligence and
15:15
autonomy. And so we have at top secret
15:18
stocks not being very secretive. They're literally posting their
15:22
thoughts on the Internet. So someone's got to tell this
15:27
person to like turn their account private or something
15:30
once, once they are being ironic.
15:32
And so we have this hire coming from Boeing's AI lab and they
15:38
ran strategic initiatives across space edge, community computing
15:41
and things like that. And good to see talented people
15:46
come in. We also had Ampam man highlight
15:50
this same hire. They went through the person's
15:54
background. And then an account I always
15:56
look to to arbitrate truth is Theodorus the atheist.
16:02
And so this account is kind of a no bullshit account to put it
16:06
lightly. And you always just want to see
16:08
if something gets picked up by Theodorus as well.
16:12
He's technical guy. I always pay a lot of attention
16:16
to whatever he's paying attention to.
16:18
So that's great. We have a lot of talent, but
16:23
then we continue to have this opportunity validated in and
16:28
around us. So Amazon company famous for
16:32
bringing you books is now, well, this isn't technically Amazon.
16:37
We have Blue Origin, founded by Bezos, filing for 51,000
16:42
satellites to do AI data centers in space.
16:46
Now the sub stack Bros with their excel spreadsheets would
16:50
tell you that this is not economically viable.
16:54
Sub stack Bros tend not to be rich.
16:57
They tend not to do shit. They hide behind the screen and
17:03
don't know necessarily what is going on.
17:06
Blue Origin has a lot of money at stake, has some very talented
17:11
people, and they're putting the money where the mouth is.
17:16
And so they have a proposed constellation of 50,051.6000
17:21
satellites operating in SSO, Sun synchronous orbit, which means
17:26
staying in the daylight. And what's interesting about
17:30
that is AST Space Mobile, thanks to Katzie pointing inside to us
17:35
also has a shell in SSO. SSO tends to also be very
17:41
valuable for military applications, but I think will
17:44
be the new prime real estate as well for AI applications.
17:48
So it's an interesting thought I've always had about this is
17:51
really rule of capture type thinking.
17:54
And so this new era of economic space capitalism, it's kind of
18:02
thinking of what term is appropriate for it.
18:05
If you get up into orbit right now, orbital slots are free.
18:08
I don't believe that that will always be the case.
18:11
You know, you could have, if you were very smart 400 years ago,
18:14
you could have probably, if you had a good musket, staked out
18:17
the entire Upper West Side and called it your own.
18:20
And then you probably have to fight off some people over time.
18:22
But you could have captured a lot of land just like Astor did.
18:27
He paid for it. But if you were there first
18:29
before the value is really known, it's a good place to be.
18:35
Leasing up the entirety of the Permian Basin, for example, was
18:41
a good idea. You know, getting free acreage
18:44
on the Bakken and you know, all this other stuff that the
18:47
railroads ran through, this was good, good thinking.
18:50
And so I believe they getting orbital slots will also be
18:54
viewed as good thinking in the years to come because once
18:57
you're really out of that real estate release, the prime real
19:00
estate, then there's going to be a price for those slots similar
19:03
to air rights in Manhattan. Spectrum is a great example.
19:07
It's very finite. And so this SSO space could end
19:14
up, I think, really exploding because of the AI applications,
19:20
because AI is very power intensive, as everyone knows,
19:23
and SSO is how you power Max power maxing is good.
19:28
So then we go back to Asts. So this AI data center in space
19:34
stuff just keeps coming. We took a little hiatus for a
19:36
couple weeks where this was kind of out of the the front and
19:40
center, but it's kind of roaring back.
19:43
And then we go back to Doctor Ollie.
19:45
This is another account that does some great work, a real OG
19:48
of the MPA variety. And it goes back and kind of
19:52
revisits why ASDS is such a great platform for space based
19:58
AI. And it's really the big power
20:02
generation is the first part. You got to have a lot of real
20:06
estate in space. You're not necessarily going to
20:09
have hold on one SEC doing my wife's like where are you doing
20:13
podcast. We're also going to be 8:00 on
20:16
Sunday. And so the second is how you
20:19
cool it. And so you have to radiate the
20:22
heat away. And we've all glommed on to the
20:26
fact that ASTS has solved a lot of these problems and there's
20:30
patents to boot. And so that's really exciting
20:33
down the line. Again, thinking like an owner,
20:36
is it something that we will get will you know create hard value
20:40
from tomorrow? I I really don't know, but
20:45
probably not. But does our tech, does our IP,
20:50
does our underlying production capacity and talent formation,
20:54
is that set up to be set us up to be a prime winner of this
21:00
trend in the not too distant future?
21:05
You know, in the words of Tupac, all eyes on me, I think, I think
21:10
yes. And the market has a funny way
21:13
when it gloms onto that conclusion of starting to put a
21:15
lot of value on things like that.
21:19
And so it's nice to see that back in the in the frame.
21:23
And what's important to me is that we have this incredible
21:28
product road map ahead of us, so much more than dead spots as
21:33
we've already seen. And it's really again showing
21:36
the platform value of AST space mobile.
21:39
This is not a point solution. This is a global infrastructure
21:42
platform. And what's so crucial about
21:45
that, what might appear to be a subtlety is the difference
21:49
between something that trades it three times revenue versus 30
21:54
times revenue. The market will reward things
21:57
with platform value, with market share domination.
22:02
And then what's cool is NVIDIA also really cementing this theme
22:08
quote space computing, the final frontier has arrived.
22:12
They're putting AI data centers in orbit.
22:16
It's exciting times and we believe that ASTS is the
22:20
backbone of what will be because of its power generation and its
22:27
heat diffusion properties, which was hard to do.
22:30
And so having certainly done a lot of work into this about the
22:34
heat diffusion issues, this was the reason why most experts
22:38
thought the company would fail. They thought that it was not
22:41
going to be able to deal with the incredible heat generated.
22:45
And then also the change in heat as you go in and out of orbit,
22:48
which wouldn't be the case with AI because again, you'd be an
22:51
SSO, you'd always be in the sunlight.
22:54
But right now our satellites are going, you know, hot, cold, hot,
22:57
cold, hot, cold and that stresses them out.
23:00
And that was a big engineering issue.
23:03
But beyond the AI opportunity, the thing that is much closer is
23:09
Satellite Connect Europe. We shall now call this SCE.
23:15
And so as Peter Limbert, Limark putting out who's our kind of
23:19
our chief European correspondent on the ground, I think actually
23:22
literally working really close to where Space Connect Europe
23:26
actually is, we're just seeing more employees join and build
23:31
that entity out. And that's an exciting way for
23:34
us to capture more MO, use more Subs.
23:38
And it goes far beyond what I think people like me here
23:42
originally envisioned where we would get, you know, an MO, a
23:45
dominant MO in a market and then have 30% market share that, you
23:49
know, that's great. What we saw with AT&T and
23:52
Verizon is boom, enemies can work together and that's why all
23:56
of a sudden ASTS is this common glue because of its economies of
24:02
scale and the rule logic behind M and OS actually agreeing to
24:07
share infrastructure in this respect.
24:09
We're we're seeing that happen with Europe too and that
24:13
European market is very big and our market share is is going to
24:18
be dominant. And that again goes back to the
24:22
SpaceX Bros thinking that they're, you know, absolute
24:25
dominant monopoly is a dominant monopoly.
24:30
And then you point out casually that this little pre revenue
24:33
shitco has multiples of the Subs covered under their agreements
24:39
and expected agreements multiples.
24:41
That is this slingshot that I think is coming where the market
24:47
wakes up and goes, this should not be $40 billion company.
24:52
Let's add a zero, you know, in the, the world of Portlandia,
24:57
like let's put a bird on it and slap some birds on this thing.
25:01
And it should just like, you know, Bluebirds, there's like a
25:04
lot of birds going on. It should be very valuable
25:07
company and the MO U's are are going to come and they're going
25:12
to be everywhere. And so Scott and the company
25:15
have been pretty transparent about the flurry of DA's that
25:19
they're expecting. I think they use the terminology
25:21
we're going to, we're going to harvest our MO U's really in
25:24
line with where initial service happens because that's where the
25:29
money is. And I think they spent a lot of
25:32
time ironing out how these agreements will work and really
25:34
how to monetize it. I can't imagine how complex
25:38
these deals were to pioneer, but they've done it.
25:43
And so now that you have a template that has been market
25:45
tested, the rest should be easier.
25:50
But what's cool is things like, again, what Peter Lindmark
25:53
pointed out, Orange wholesale CEO talks commercial launch for
25:58
new D to D service at ASD Space Mobile.
26:01
And he talks about how not only are they working on the European
26:06
part, but then elsewhere in the Orange ecosystem.
26:12
So they want to roll it out to their European customers, but
26:16
then they're going to go global with it.
26:20
Very exciting stuff. Lots of contracts are going to
26:23
come. And while the MO U's are telling
26:26
you what's going to happen, so is the government.
26:29
And so going back to this economic warfare unit, which is
26:33
really seems really cool to be honest.
26:37
And so deal Team 6, which is going to have this $200 billion
26:42
of capital to really thrust the US into the forefront of
26:47
innovation, which is very smart. Let the private market fuel
26:52
incredible innovation. Government money is going to be
26:55
flowing to all of these types of things.
26:58
And ASTS is no longer a hypothetical military prime.
27:03
We're an actual prime and we work with other primes.
27:06
And so to me, one one area where I wish I had been sort of
27:10
smarter and it goes again to being a long term thinker is
27:13
when Biden passed the IRA act and they basically just guzzied
27:20
money into utilities. All you had to do was kind of
27:23
understand the thrust of what government was doing.
27:25
The government was putting its its finger on the scale.
27:29
You just had to buy stuff. I think it was like, if actually
27:33
you still on the same way from now.
27:35
I'm forgetting what it's called like power sticker quanta
27:39
services, things like that. And just pulling up a chart when
27:42
IRA was passed. I mean, this thing's been A5
27:45
bagger since then. The chart chart is straight up
27:48
and that was before the AI boom. And that's what's crazy is like
27:53
great things happen to good things and government said we're
27:57
going to, you know, create a lot of renewable stuff and we're
28:01
going to really bolster up the grid, which they did.
28:04
That was where the money was going and this and the stocks,
28:07
stocks went up. And so the government money is
28:09
going to be going into this and just even last week we found out
28:13
that yet more money is going in specifically to Golden Dome.
28:17
And so they just upped that by an additional $10 billion to 185
28:25
if you're big programs. And the expectation is that ASTS
28:28
is going to get some more Golden Dome awards this coming quarter
28:33
in Q2. I think these things really wake
28:37
the market up. Golden Dome is sort of magical
28:39
in terms of the dollar amount, the importance to the military.
28:44
And so having in the company get more awards and scaling that it
28:48
certainly increases the validation of the company.
28:51
And I think we'll reinforce this dynamic of the Texas hedge.
28:55
And so people seeing the massive market opportunity created by
29:00
SpaceX showing this type of growth was possible.
29:05
You you just want to buy the strip is is what my view is
29:09
going to be. And Golden Dome just solidifies
29:12
in people's mind like, hey, this is a bonafide military
29:16
contractors as well, just like SpaceX.
29:18
That's exciting. And so the real question for us
29:23
is going to be who else is working with AST Space Mobile?
29:26
It's not lost on us. There's a catsy tweet that
29:29
Lockheed uses the exact same PowerPoint template is AST Space
29:33
Mobile. So either someone took their
29:38
template deck when they left AST Space Mobile and went to
29:41
Lockheed, which is a no no, or they're working together.
29:44
Or hey you know what, hexagons are cool and people just
29:47
randomly had the same thing. But beyond Golden Dome, the sat
29:53
com opportunity itself. So just actually using
29:55
satellites to talk to people, not to systemically destroy
29:59
another company's military infrastructure blinded with
30:03
radar searches and all this other fun stuff you can do with
30:07
satellites. Actually reaching out and
30:09
touching someone is still a use case for a satellite and the
30:14
Space force just prioritize quote resilient commercial sat
30:17
com and gave it its own acquisition lane.
30:19
And so thanks a lot for Jonathan Cooper pointing this out.
30:22
But the a general thrust is just government wants more of the
30:30
stuff multi layer comms. They don't want a single point
30:34
of failure and we all know the benefit ASTS has with his bent
30:40
architecture because it allows the government to retain control
30:45
to make sure that a very sensitive communications aren't
30:49
bouncing around countries that you don't want them to be in.
30:53
And we had a tough for our point out that Fairwinds just won
31:00
another contract for enhanced security with Leo Networks.
31:04
So there's just all these little pieces that keep keep coming.
31:08
But then going back to the non communications use cases, the
31:15
radar application of this stuff is still amazing.
31:19
And part of that is related to denying people the ability to
31:26
have GPS. And so the Bluebird
31:28
constellation is capable of rendering the Russian GLONAS
31:32
system ineffective while not interfering with GPS.
31:38
And so it has to do with the spectrum bands that ASTS has.
31:44
One that is very interesting is of course the legato spectrum.
31:48
Legato spectrum for people that have played alone from home
31:51
knows that the Department of War has actually already started
31:53
using this and that's actually very contentious litigation with
31:57
the Legato pre petition investors who got kind of
32:01
screwed by this. But the government is very
32:05
territorial about this spectrum and it's been disclosed in
32:08
litigation that they're using it for radar and other things like
32:17
that. And So what Katzie did with a
32:20
really cool post is show that with our mid band satellites
32:24
which are coming, we have the ability to, we be in the US as a
32:28
customer of AST Space mobile have the ability to completely
32:31
jam the Glownash channels and that is PNT position navigation
32:37
and tracking denial. You black them out pretty
32:41
powerful. And so then other people have
32:45
now designed systems that get around GPS denial and a role
32:49
just devised some clever technology to do this as their
32:52
drones were getting smoked in Ukraine.
32:55
But it just creates one more layer of complexity that our
32:58
adversaries have to deal with. And my belief is that silencing
33:02
the enemy can be a big business and yet another use case that I
33:08
think that ASCs will get paid for in its non communication use
33:12
cases. The other thing, it's almost
33:15
like a running joke at this point.
33:16
But Firstnet will happen soon. And Firstnet had a meeting last
33:21
week and we don't know when or how a deal will take shape with
33:28
Firstnet. But at this point, anyone that's
33:30
in First that denial category has to have their head checked
33:32
because it's literally in the FCC docket with Band 14.
33:36
They've posted all the technical details.
33:39
Firstnet has changed their own website highlighting the
33:41
service. There been numerous YouTube
33:44
videos of Firstnet people where their titles are manager of the
33:48
ASTS project. I mean it's, it's that's like
33:51
all the pieces are there and that's just kind of exciting
33:53
because it could be on my math that could be almost a billion
33:55
dollars of revenue. You really just tie that against
34:01
66 million Subs at Firstnet and some probably pretty healthy
34:05
Arpus from what is really kind of like a high value affinity
34:09
group when you think about first responders.
34:13
But then beyond things like Firstnet, which are going to
34:18
probably rely more of a consolation being rolled out,
34:21
you have this ever present IoT opportunity.
34:24
And this is something I'm just so bold up on when I think about
34:27
how many air tags I've I've purchased.
34:30
And just this weekend I was in and out of cell phone service
34:32
and like really in places where you would not want your cell
34:35
phone to die. It, you know, I felt was a
34:38
little bit if anyone watched the prequel of Yellowstone, some of
34:44
some of these places where you're really not that far out
34:46
of civilization. You're really looking in a
34:48
landscape and going like this is exactly what people were looking
34:53
at in the 18th century when they were, you know, trying to not be
34:57
in that place because they had to get out because it's barren
35:00
and rugged and you will die. And it's a great place to go
35:04
camping. But you have to think, well,
35:07
what happens if my if something happens, I cannot call for help.
35:12
Well, think about some of these trade routes where the the flow
35:18
of goods are going through many of these places from one urban
35:22
center to another. Think like I-15 going through
35:26
think the Death Valley. There's a lot of stuff that that
35:30
moves and especially on the ocean.
35:33
And so this IoT opportunity for trackers is really important.
35:39
And you have AT&T partner with Vidia and Cisco to build an AI
35:46
grid for IoT. Well, this isn't going to be,
35:49
something's going to be limited to AT&T's terrestrial network.
35:52
Why would that make sense, especially in IoT?
35:55
If anything, that's the thing that's most exposed to dead
35:59
spots versus people because people stay where people live.
36:02
Generally things are moving between people definitionally a
36:10
lot of the time where people are not.
36:13
And so if AT&T is partnering with NVIDIA to really ramp up an
36:17
AI grid for IoT, that almost necessarily is going to be
36:21
relying on a non terrestrial network to have it all connected
36:26
and that gets really exciting. Again, how do I quantify it?
36:30
It's not possible released by me, but it's the type of thing
36:35
that's going to support a very hefty revenue multiple because
36:38
the market will know that this is open-ended growth runway and
36:42
that gets that gets really exciting.
36:44
Once a company starts to put up real results, which this company
36:48
will in the coming quarters. That's when people go well, OK,
36:51
so they're obviously delivering some good stuff and then that
36:54
can reflect upward with, you know, really as far as the eye
36:58
can see for growth runway. The market will pay a lot for
37:02
that and that's where you really kill it as an investor where you
37:07
guess correctly, where I guess, but you do the work and forecast
37:12
the right directional movement of revenues, but then you are
37:16
positively surprised on the multiple.
37:19
The market will pay you for that and that's your double bang of
37:22
your compounding at the rate revenues go higher given a
37:26
constant multiple, but then you accelerate your returns when the
37:30
revenue multiple goes above whatever the static assumption
37:34
was. It's really exciting and all of
37:36
these things we've talked about, you know, during this little
37:39
session are all things that represent sort of surprising to
37:44
the upside revenue opportunities beyond dead spots to power.
37:50
All of this is going to require spectrum.
37:53
And as everyone knows, Legato is a big slug of really great
37:59
spectrum that's going to allow ASTS to deliver incredible value
38:03
to its M&O partners because it's delivering more than bent pipe
38:08
at that point. It's actually delivering the
38:10
blood of telecom, which is the ability to have radio frequency
38:17
transmissions. And so the Legato docket keeps
38:22
pressing ahead. We have a consolidated
38:27
opposition to objections filed this last week.
38:30
And so it keeps coming. I actually don't know the
38:33
timeline of when this when the FCC would approve this, but the
38:40
comment period is closed to believe and you know it it,
38:45
it'll happen when it happens. That's really what we have.
38:50
There's one more thing Scott filed.
38:52
Scott, the president of the company filed to sell a little
38:56
bit of stock. I we've been over this before.
39:00
This is his compensation and so it sometimes it you know,
39:04
depending on your own background, either you can be
39:07
sympathetic to it or not, But Scott Scott is a high-powered
39:11
executive. He's a valuable person.
39:14
His his next he provides valuable services.
39:17
His next best alternative in life would be very highly paid
39:22
banker but he chose to make make stuff and went to AST Space
39:29
Mobile and most of his compensation is in stock and so
39:33
he gets a 200 or $250,000 base which is great.
39:37
Sure he really appreciates it but to top up his comp to make
39:41
it comparable plus plus to what he was earning, he has to sell
39:46
some stock every once in a while for some liquidity and then he
39:51
will get additional stock from grants.
39:54
This is called a RE up and so ASTS for him is in as a
39:57
compensation and investment vehicle, but he's foregoing
40:05
effectively, you know, the vast majority of the cash comp he
40:07
would get doing something else like being a banker.
40:11
So he filed to sell a little bit.
40:12
And so he did a small sale in September, in October of 2024.
40:17
So the stock kind of was, you know, flat to generally kind of
40:21
blow for a couple months after that.
40:23
But I don't believe there's any real bad news.
40:26
And then the next sale was in March. 17th stock certainly
40:33
traded down after that, but by July, the stock had doubled from
40:40
when he had filed to sell. In June, he had also filed to
40:43
sell. Stock doubled pretty good.
40:46
And so when I think about this, I don't really think about it
40:50
because at this point, I really understand what Scott's sort of
40:53
picture is and I don't really read into it.
40:56
But if I were Scott, these guys are really sensitive to the
41:02
optics and they also have a lot of respect for the retail
41:07
investment community. And so given that this isn't
41:10
like he's selling all of his stock and he's trying to dump it
41:12
at the perfect price, which he's definitely not doing that, then
41:16
I think the game theory is actually somewhat interesting
41:18
here where whenever he files a cell a little a little bit, you
41:22
can almost assume that there's good news about to come.
41:25
So he's never going to get sued for selling stock before good
41:29
news. That just ain't going to happen.
41:32
There's no jury in the world that would say that there was a
41:35
harmed party in that other than himself.
41:38
And so I think this is what these guys generally do is
41:42
they'll have their quiet periods.
41:44
And so they reported earnings and then they take their prints,
41:48
which is their compensation. But they do so knowing that
41:51
there's likely in the in the month subsequent to that filing
41:55
going to be some good news, which gives them a liability
41:58
shield and doesn't really cost them a lot.
42:00
And so he sells some shares, fine, go sell them higher or
42:02
whatever. But he's going to get react
42:05
because that is again part of his compensation.
42:07
So for him, it's just about how to bring in a couple 1,000,000
42:09
bucks a year of compensation while keeping the vast majority
42:12
of the big slug of his stock, which is worth almost $60
42:15
million right now, keeping that big slug slug as the real
42:20
investment vehicle that that he's created by being an
42:24
executive at AST Space Mobile. And that's his pathway for being
42:28
a seriously rich dude. And I'm sure he imagines that
42:32
his position is going to be worth quarter of a billion to
42:35
half, half a billion dollars at at some point.
42:39
And I hope it is because that also is boding well for yours
42:43
truly. So this week we'll see.
42:46
I'm really just glued to seeing if there's any developments on
42:50
New Glenn. That thing should hot fire, I
42:53
think, but we could be wrong. And then once it hot fires, then
42:58
they'll they'll lock in a date for New Glenn 3, which at this
43:04
point, if it slips a little bit, I won't be able to go
43:06
unfortunately because of some kid kids stuff which I can't
43:10
change, which is unfortunate because I would really have good
43:13
all these launches. But then we're really close to
43:17
April and that's when we're going to really, I think be
43:22
right in the the hump of getting batch one out the gate because
43:28
they've been working on the composites.
43:30
And I actually spent the weekend when I was camping.
43:33
It's crazy how many people are involved in the space industry.
43:35
But I was with a guy that works at another publicly traded
43:39
launch company, which shall remain unnamed, but he was
43:42
telling me all the specifics on how they do the composites.
43:47
And this is complicated stuff. It's, it's very challenging to
43:51
do. So I, I always am humbled by
43:54
some of the experimentation and the trial and error involved to
43:57
get this stuff done. And that's the, that's the
44:00
latest thing that ASTS was doing is just making sure the
44:03
composites could withstand all the stresses of launch.
44:07
The composite helps them shave down the weight of the
44:12
satellites, which allows you to stack a lot of them in a launch.
44:16
But anyway, when when you kind of get inside baseball from some
44:19
of these space companies, you know, just sit around a campfire
44:22
talking about composite. It's like, I wonder if people
44:27
what other people talk about at campfires.
44:28
But that's what I talk about at campfires is composite testing.
44:32
And when you start to really learn more about it, you just
44:36
start to cut people some slack. Like these guys, they got it.
44:39
It took a little while. And this that's going to ship in
44:41
April and it's going to coincide with the run up of SpaceX and
44:45
say you start to look at this picture we have over the next
44:48
quarter. And I get really excited because
44:53
it would really be fun to have this stock really just RIP up to
44:57
$250 because then I'm going to go buy every Toyota dealership
45:02
and only sell Tacomas and force my worldview on people because
45:08
they will not be able to buy anything other than that.
45:10
And that's going to be what I do as an eccentric rich guy.
45:14
So with that, I hope everyone has a really great evening and
45:17
hopefully we have some cool news this week.
45:20
But I think it's really just the market digesting macro.
45:23
And then I think the smart people are going to be getting
45:26
positioned appropriately for, I think is this very exciting
45:29
queue too. I know I am.
45:31
I'm always a little bit early and usually wrong, but that's
45:35
what I'm going to be doing. So have a great week everyone.
45:38
Thanks for joining me. Let's keep finding cool research
45:42
and I'll monitor that situation and aggregate it for the weekly
45:48
talk soon. Thanks for listening to the AST
45:51
Space Mover podcast. If you enjoyed this episode and
45:55
you'd like to help support the podcast, please share it with
45:58
others, post about it on social media, or leave a rating and
46:01
review. To catch all the.
46:03
Latest news about AST Space Mobile, make sure to subscribe.
46:07
Thanks again and I'll see you next time.
46:13
We're doing something very, very big and I think with this
46:15
technology we can really affect a billion lives.
46:18
AFT Space Mobile is the only company that has good technology
46:23
to deliver cellular mobile connectivity directly from state
46:26
to the everyday smartphone. People will just basically.
46:30
Turn their phone. Be seamless, but regardless of
46:33
where you are, we don't want the user even to know that it's
46:36
connected by satellite. Our role is to bring this into
46:40
reality, always in partnership with the MMO Listen.
46:56
Waffles.