Latest / AST SpaceMobile Podcast / Kook Weekly - February 15 - The $4 Billion War Chest: SpaceMobile’s Path to Global Dominance

Transcript

Kook Weekly - February 15 - The $4 Billion War Chest: SpaceMobile’s Path to Global Dominance · AST SpaceMobile Podcast

• 0:06
  This is the AST Space mobile. Podcast.
• 0:10
  We just basically turn the phone and be seamless, regardless of
• 0:14
  where you are. We 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.
• 0:28
  Good evening. I was looking at the roster
• 0:29
  thinking, I don't know if I can start if Corey's not here, given
• 0:33
  that I gave one minute advance notice.
• 0:35
  I'm like, oh, maybe I'll let him go this time.
• 0:37
  And then bang, like clockwork, Corey is here.
• 0:42
  So thanks to everyone for joining.
• 0:44
  I hope the connection is good. I'm on on a dicey connection,
• 0:49
  but we'll see how it goes. And So what a week for me for
• 0:54
  sure. What a week last week was.
• 0:57
  This continuing week has been an absolute horror show for health,
• 1:01
  but also a good reminder on why to invest in your health.
• 1:05
  Nothing really matters if you're not feeling good.
• 1:10
  My little chaotic journey toward fry your neuro system has now
• 1:17
  led to sciatica, which is truly hell on earth.
• 1:21
  But you know, the the final boss of my peptide journey, I guess
• 1:27
  is the inflammation of my sciatic nerve.
• 1:33
  And she's super fun. But hopefully I'll get over
• 1:35
  that. And that's what I was kind of
• 1:36
  staring at the ceiling this week and I just realized, you know,
• 1:40
  there's two ways to think about ASTS stock price.
• 1:43
  There's to fight it or to accept the singularity with it.
• 1:48
  And just, you know, in the words of Tame and Paula, just let it
• 1:51
  happen. And certainly the way I feel, I
• 1:55
  feel like a stock that went from $130.00 to 80 it there's no
• 2:01
  other way to say that. I think I've just become the
• 2:03
  stock, which is maybe maybe what is supposed to happen.
• 2:07
  So there's no more thuk bottom because that would be sort of,
• 2:12
  you know, trying to think of 1's emotions versus a stock versus
• 2:17
  actually just now the, the true kook bottom is like how much my
• 2:21
  butt hurts because of my SAC nerve.
• 2:24
  And so we've like gotten to a new level of like, do I feel
• 2:27
  bummed out or is my bum like literally causing me paralyzing
• 2:32
  agony every time I sit? So there's a new kook bottom.
• 2:35
  And I think that we can say if we say that this kook bottom is
• 2:38
  freaking real. And I will not be surprised at
• 2:42
  all if as I recover, which I have definitely made some
• 2:44
  progress according to Gemini, that the stock also bottom.
• 2:49
  So this last week was one of those things I feel like in a
• 2:54
  prior life I would have I would have gone berserk.
• 2:57
  But you know, the market's been kind of crappy.
• 2:59
  I don't like make macro calls. Certainly I don't post that.
• 3:01
  But I've been talking a lot to Ampam man about, you know, how
• 3:05
  worried I was about February. He of course, ripped me a new
• 3:09
  one and Tut was mocking me relentlessly.
• 3:11
  But it's just like that's what happens after the January effect
• 3:13
  is stuff needs to cool off things.
• 3:15
  You're feeling too hot. And so sure enough, things were
• 3:18
  cooling off. And then, you know, bad news
• 3:21
  lights company. And so of course, Scott's like,
• 3:23
  I know what I could do. I'll issue another convertible
• 3:26
  bond and just, you know, scream fire in a crowded theater.
• 3:30
  Like, why not? And so, you know, then boom,
• 3:33
  $100 floor gone. Now we're back.
• 3:36
  Frankly, where the charts were kind of sane, the lower end of
• 3:40
  the channel would be. So we're still having a pretty
• 3:44
  controlled sell off, which which frankly makes it feel a little
• 3:48
  bit better to me. It seems like there's still
• 3:52
  reason. I know there's some of you that
• 3:54
  would say, you know, stocks laying off $50 and, you know,
• 3:58
  lose your mind. But that's what I think is kind
• 4:01
  of necessary because the people on this call are 99% of us.
• 4:05
  I don't know who's on this call, but 99% of us are the rightful
• 4:07
  owners of this company. We deserve to own it.
• 4:10
  We are the heirs of this empire. We have put in the work, we've
• 4:12
  put in the pain. And so down, down terms like
• 4:16
  this cause more shares to flow to people like us away from the
• 4:20
  people who didn't really know what they're doing, saw a high
• 4:22
  momentum stock, got caught up in things, and then, you know, get
• 4:25
  their, their stop losses hit. Those are not the natural owners
• 4:28
  of a stock. And if it were easy, everyone
• 4:30
  would do it. And so as the NPA man said the
• 4:33
  other day, he was doing one of his 15 spaces and he said
• 4:37
  something like, well, Kook doesn't really do well in up
• 4:41
  markets. And and that's right, I get
• 4:44
  really uncomfortable when the stock is doing great.
• 4:46
  And it's a bizarre thing because I'm printing, but I get, you
• 4:51
  know, people will notice. I don't really tweet.
• 4:52
  I just kind of go into turtle mode.
• 4:54
  I get very uncomfortable with success, I guess.
• 4:59
  But I get much more comfortable in markets like this because
• 5:02
  this is when I feel like I can add more value to people by by
• 5:06
  trying to again, focus on the fundamentals, being hopefully a
• 5:09
  voice of kookiness, but at the same time some reason.
• 5:13
  And and this is where the I I, you know, like where warriors
• 5:19
  win, you know, in battle. And now we're back in battle.
• 5:22
  And I like battle. I like war.
• 5:23
  I like, you know, not real war, but like stock war.
• 5:26
  And I'm a distressed guy by by background.
• 5:28
  So I kind of like it when it's a little bit more bloody guts
• 5:31
  because it's what allows the the the weak to be separate,
• 5:36
  separate from the strong. And so when you look at the
• 5:38
  fundamentals as opposed to the stock price, you can see
• 5:43
  opportunity. And so we had a big week terms
• 5:46
  of fundamentals, FM 1 was deployed.
• 5:50
  So we've been tracking this really carefully.
• 5:52
  Looking at the data, Frank, I've seen frankly too much was
• 5:55
  actually really obnoxious. But when I'm looking at the
• 5:58
  orbital data now, it, it's very evident when they did the final
• 6:03
  unfurling. And so now as you stare at this,
• 6:06
  you can see when they probably went into the bar configuration
• 6:09
  or did the payload module and then the final unfurl.
• 6:13
  So it might have been a 2 step, might have just been one step.
• 6:16
  We'll never know unless they clarify it.
• 6:18
  But it is clear as daylight now on the orbital data.
• 6:21
  Exactly. You know, something happened
• 6:23
  right before they did that PR and what an event.
• 6:28
  You know, this, this event. I, I, I don't say I was worried
• 6:33
  about it, but the thought had crossed my mind that there was
• 6:36
  some mechanical risk to unfolding.
• 6:40
  I said unfolding, but that's just like me defeated.
• 6:43
  You know, the sciatica is speaking frankly.
• 6:46
  When I'm healthy, I'm going to go back and be like fucking
• 6:48
  unfurling Scott. But now in my weakened state, I
• 6:51
  will say unfold and I will I will surrender.
• 6:55
  But this thing unfolding is a really important accomplishment.
• 7:00
  And the stock price took it for granted in terms of we had $100
• 7:05
  stock price around about. So the market assumed this would
• 7:08
  all work, and it did. So the market got it right,
• 7:12
  despite all the experts saying this stuff would never work.
• 7:15
  That's the good news is the market is efficient.
• 7:17
  If there was real concern around the deployment of the satellite,
• 7:22
  they wouldn't have been hanging out at a $40 billion market cap,
• 7:26
  tell you that much. But it needed to work, and work
• 7:29
  it did. And so this is one of the
• 7:32
  Seminole tech milestones for us to hit because it shows that
• 7:38
  they can they can deploy the scaled next Gen. satellite.
• 7:43
  So we've now really gotten all the systems really validated and
• 7:49
  to go 7 for seven is pretty cool.
• 7:52
  Like we're, I'm sure we're going to have an anomaly at some point
• 7:56
  and hopefully that that's kind of in somewhere in like
• 7:58
  satellite 50 to 243 where it really won't matter.
• 8:03
  But the, the fact that they had a hit rate like this is pretty
• 8:06
  remarkable and shows you the different type of approach.
• 8:09
  They're taking more of a Blue Origin approach of step by step
• 8:12
  ferociously versus the let's blow stuff up for data, which is
• 8:17
  what SpaceX does. This company is not capitalized
• 8:20
  to do that historically. And I'm glad that they don't
• 8:24
  blow stuff up in orbit for for data.
• 8:27
  I don't know if I have the constitution to handle that, but
• 8:31
  showing that this can unfold is a big deal.
• 8:33
  It really de risks a lot of things.
• 8:36
  And, you know, they now have the data, they're getting flight
• 8:43
  data as we speak. And so whether they were holding
• 8:45
  back batch one or not is anyone's guess.
• 8:48
  It's a reasonable conclusion to think that they might have kept
• 8:51
  those satellites in the Bay just in case if they had to fix
• 8:55
  anything. But now those birds should be
• 8:58
  ready to fly the coop. And sure enough, we're starting
• 9:01
  to get some updates on the next shipments and what they might
• 9:04
  look like. So we're seeing that potentially
• 9:09
  4 satellites are going in a Falcon launch, So that's a
• 9:16
  change from the three. So maybe they got the weight
• 9:19
  down dramatically, you know, good news that decreases the
• 9:24
  cost because the cost of a launch is largely fixed.
• 9:27
  So dividing that cost by 4 versus 3 helps them get to that
• 9:34
  longer term. Call it $22 million per
• 9:36
  satellite cost, which they've got some room if I'm even
• 9:40
  halfway right on my economics, they could spend a lot more on
• 9:43
  satellites. And this is still a fantastic
• 9:44
  model. But Wall Street is going to be
• 9:46
  really happy to see them hit these cost estimates, you know,
• 9:51
  largely and it's going to be more expensive upfront and
• 9:57
  average down in the back half, which is always convenient for a
• 10:00
  company to be like, no, no, we'll make it up in the back
• 10:02
  half. But hear you really well,
• 10:04
  especially as you start getting more scaled launching.
• 10:07
  So FM 1 deployed big milestone something that made me just very
• 10:13
  relieved in that moment as I was best in pain just thinking, OK,
• 10:20
  I can really sleep easy easier on this investment knowing that
• 10:27
  we've really started to isolate the if and unless statements to
• 10:32
  kind of an unless they can produce and I have a lot of
• 10:38
  confidence that they will be able to produce.
• 10:41
  And so because we're getting we're getting kind of proof of
• 10:44
  that. So it's no longer if they can
• 10:46
  deploy this new next Gen. satellite.
• 10:49
  It doesn't really seem like it's an issue of if they can produce
• 10:51
  6 satellites at scale. It's really unless something
• 10:56
  that's not visible today changes.
• 10:58
  It seems like we're really positioned for greatness and
• 11:02
  that's how our partners see it as well.
• 11:04
  So it's not lost on me that they have continued interviews by the
• 11:08
  CEO of AAT and T talking about their partnership with AST Space
• 11:13
  Mobile. It's a reminder of where we
• 11:14
  stack in the importance to our partners.
• 11:19
  And then partners are one thing, but nations and continents are
• 11:23
  another. And so our European analyst,
• 11:26
  Peter Lindmark, we'll call him our European correspondent,
• 11:30
  kindly shared with me, as he always does, some updates from
• 11:34
  Europe. So the EU Council had a meeting
• 11:36
  yesterday addressing the current challenges in Europe, of which
• 11:38
  there seem to be many, and what's to be done, including a
• 11:42
  move from fragmented market in several sectors to have a true
• 11:45
  single market in the EU. Fast forward, this really seems
• 11:52
  again why Satco is positioned so well.
• 11:56
  It just does not make sense economically to have a
• 11:59
  balkanized Europe as it relates to economies of scale, Platform
• 12:04
  infrastructure makes no sense. And it makes no sense for
• 12:09
  generally non evil countries to have their own systems.
• 12:12
  And so thinking about countries that are not invited to
• 12:16
  participate, you know, you have such places like Iran, Russia,
• 12:21
  China, whether they're evil or not, whatever.
• 12:24
  But like definitely not shared infrastructure partners, but
• 12:28
  kind of the rest of the world, it makes no sense for them to
• 12:30
  have their own infrastructure. They should share it.
• 12:34
  It's super expensive and it is kind of a perishable good as it
• 12:40
  flies over Europe each day or every 90 minutes, that's data
• 12:44
  capacity that you're being used or not.
• 12:47
  It's incremental cost is basically 0.
• 12:50
  So it makes sense to to use it. And that's why I think SAT Co is
• 12:54
  in a really great position. And so where you have
• 12:59
  incremental cost of 0 and then you have a lot of revenue,
• 13:01
  you're going to have a really good business model as it as it
• 13:05
  scales. And on that note, ASTS did
• 13:09
  revenue. And so really what have they
• 13:11
  done now, if anyone wants to show billions, you remember, you
• 13:16
  don't want to have revenue as a start up because then they're
• 13:18
  going to want more revenue and more and more and more.
• 13:21
  So game's up guys. Our days as a pre revenue Speccy
• 13:26
  story stock are over. We are now a real company and
• 13:30
  with that comes real obligations and responsibilities.
• 13:34
  And so of course, ASTS being true to form, they miss the high
• 13:37
  end of their of their target. That's how you know that
• 13:41
  everyone there is still alive. So they over guided, which is
• 13:46
  what they're famous for. But that's why we love them
• 13:47
  because they're setting ambitious targets.
• 13:51
  They're probably driving that team to make sure everyone in
• 13:54
  the room has sciatica as well. Sure, it's a room full of people
• 13:57
  that scream in Aggie agony every time they get up because they're
• 14:00
  so stressed out and they're doing it because they're driving
• 14:02
  hard toward a really big goal. And so for the fiscal year 2025,
• 14:08
  the company's revenues were approximately 63,000,000 to
• 14:11
  $71,000,000. I, I'm really happy by that.
• 14:15
  I was just praying to God they wouldn't flood it and come below
• 14:20
  the low end, low end of the range, which was 50 million.
• 14:23
  Because I, I can only imagine how excited Scott was to have a,
• 14:29
  you know, really big hit. And, you know, he did it.
• 14:38
  And, you know, a lot of this was going to be gateway sales and
• 14:40
  things like that. And so the main event is, is yet
• 14:43
  to come, but it's a good start. And I was just watching on the
• 14:48
  Internet, not only Tim Ferrar get just totally mogged by Elon
• 14:53
  Musk, which is karma as this guy's name just gets put into
• 14:58
  the dirt because he is seemingly not a very honest guy.
• 15:03
  But then he was mocking people for posting the sell side
• 15:06
  estimates on ASTS revenue, which of course show this thing going
• 15:10
  to like a billion dollars of revenue in short order saying
• 15:12
  that these are, you know, the lies and frauds of the space
• 15:18
  Bob. But I this is where I think he's
• 15:21
  going to be sorely, sorely wrong.
• 15:26
  Point you back to what Scott has said in the next week, which is
• 15:29
  Scott saying, quote, we see a good runway to 10s of billions
• 15:33
  of dollars in the end state of revenue being created.
• 15:35
  That's what I hang my hat on and I think that's right because
• 15:38
  this is something that should be really like a very short gradual
• 15:42
  period. And then sudden because I do
• 15:45
  think this is one of these globalist things where
• 15:49
  everyone's going to kind of want it to have the same thing at the
• 15:51
  same time. People are going to see that
• 15:54
  their satellite phone can just be activated and they're
• 15:57
  probably going to do it within pretty short period of time.
• 16:00
  And then the future growth is going to become from other
• 16:03
  markets opening up or that's IoT or frankly I said frankly,
• 16:07
  again, if I could do push ups, I would do a push up every time I
• 16:10
  said that and I'd ask Corey just to count it so he could hold me
• 16:13
  to my promises. But I think that as ASTS
• 16:17
  Platform Co happens and you start opening up this platform
• 16:22
  for uses that the company might not even know, but people could
• 16:26
  see, You know, for example, maybe some people want to have
• 16:29
  some buoys out in the ocean to spot submarines or dolphins or
• 16:34
  track sharks to keep them away from me.
• 16:36
  Or you're going to want to have those lit up for communications.
• 16:40
  I don't know that Sky is thinking like, oh, someone, some
• 16:43
  guy named Kook wants to create an early warning system for
• 16:45
  sharks around the surf spots he uses and he's willing to invest
• 16:49
  money to do that. That's really not going to be on
• 16:51
  the commercial radar of ASTS. But if they had an API, and I'm
• 16:55
  sure they will, you can start to have developers dial this in and
• 16:59
  that's what I think is going to happen.
• 17:01
  And that's where this really cool kind of UGC user generated
• 17:05
  content platform opens up. Think of Asts is Roblox for
• 17:10
  telecom. That's a big idea because you
• 17:13
  want to harness the creativity of creators and and I'm not
• 17:17
  thinking of like Instagram creators, but you know, founders
• 17:20
  and people that are looking to solve unique problems because of
• 17:22
  a familiarity with unique problem statements and then
• 17:27
  leverage this connectivity in this technology for those
• 17:30
  purposes. And then for Asts to get paid
• 17:32
  for it. That's where things start to get
• 17:35
  pretty spicy in terms of revenue that people couldn't have
• 17:38
  possibly predicted. But then we also have doctor
• 17:41
  Mike probably should call doctor Mike and be like, yo fix my
• 17:44
  back. But in the meantime, he's fixing
• 17:46
  my brain by teaching me about the end state of AST space
• 17:50
  mobile. So this tweet from doctor Mike
• 17:53
  was pretty good. He says, well, the end state for
• 17:56
  Asts is a non terrestrial network mirrored as all the M
• 17:59
  and OS set up terrestrial networks that is dynamically
• 18:02
  allocated by AI at the base station.
• 18:05
  And so he goes on to the point that this really should just be
• 18:08
  a secondary redundant network that gets toggle on, toggle off
• 18:13
  as economically merited. So what I think of this is a
• 18:17
  little bit like the grid. And so if I'm sitting there with
• 18:22
  a coal plant and nuke, some wind farms, some oil gem and some gas
• 18:27
  gem, I'm sitting there playing an optimization game of what do
• 18:30
  I dispatch? And when I think that the
• 18:34
  telecoms are going to have that same thing, they, for example,
• 18:36
  could turn off towers to save OP X and things like that when they
• 18:41
  could otherwise just serve the demand curve with Asts at that
• 18:46
  moment. There's lots of interesting
• 18:47
  things. And that's where this just
• 18:49
  becomes the ubiquitous global overlay, which is what I think
• 18:53
  will happen. It's seemingly very consistent
• 18:56
  with what the AT&T guys have said in various interviews about
• 18:59
  utilizing the guard bands. So that's a big idea.
• 19:03
  How it exactly transformed to our revenue estimates and ARPU
• 19:07
  and things like that are all too hard for someone like me to
• 19:12
  estimate with any precision. But, and sorry, I remember I was
• 19:17
  just calling in. I just texted her and said then
• 19:20
  unless there's a catastrophe doing my spaces with my MOB, OK,
• 19:31
  and she'll understand that. So then we have signs of a
• 19:37
  ramping Tam. And this goes back to kind of
• 19:39
  what I was just saying, the issues of people not really
• 19:45
  being able to understand what's possible.
• 19:49
  And so Catsy just sees more and more firing happening for
• 19:54
  defense and radar. And this is pretty interesting.
• 19:56
  So ASTS investors found this job posting.
• 20:02
  For a senior FPGA engineer was side note.
• 20:06
  I think a lot of us originally thought that the FGPA was sort
• 20:11
  of a temporary bridge to the ASIC.
• 20:13
  I'm less convinced now. I think that there might be a
• 20:15
  parallel block with FGFPGA which are more adaptable.
• 20:19
  So they're more power hungry and they're heavier.
• 20:21
  That's why they're not as good. When you know exactly what
• 20:24
  you're doing, you'd rather just have an ASIC, but where you have
• 20:28
  a lot of dynamic things happening, such as with the
• 20:31
  military, FPGA can be very interesting.
• 20:33
  So they're hiring for this and very specifically talking about
• 20:37
  radar use cases. So there's a dead giveaway.
• 20:42
  You will directly influence the performance and resilience of
• 20:45
  next generation radar and communication systems supporting
• 20:48
  the war fighter. Well, there you go.
• 20:55
  So that's telling you that this is much more of an ongoing a
• 21:00
  business priority versus a bridge to the ASIC.
• 21:04
  What that means is there's more Tam than we otherwise all else
• 21:07
  equal, would have thought about. And So what do you do if you're
• 21:11
  a Class A founder with an expanding market opportunity
• 21:15
  that you're rushing to serve, what do you do?
• 21:19
  Well, unfortunately for us, you raise money.
• 21:21
  And so these guys decided that if $2.7 billion wasn't enough
• 21:27
  for you all, maybe you'll be happy with four.
• 21:30
  And so they did a big convert. Another drive by knocked a lot
• 21:35
  of us out of bed in terms of like, oh God, seriously.
• 21:37
  Like not the kind of, oh seriously, do you did a convert?
• 21:41
  I'm, I'm happy that we have the capital.
• 21:42
  It's teeny dilution. You don't even feel it.
• 21:45
  It's just sort of like, OK, now I got like another week and 1/2
• 21:48
  or two weeks for the stock price to like absorb, you know, this
• 21:51
  new supply just kind of annoying.
• 21:53
  But life goes on. I wasn't planning to sell
• 21:55
  anytime soon. So it really doesn't matter
• 21:59
  other than just general annoyance, But it does help if
• 22:02
  you're a long, long term investor, and I hope many of you
• 22:04
  are. It means that we have just an
• 22:10
  incomprehensible change in capacity over the past two
• 22:14
  years. I mean, we almost had no cash in
• 22:16
  2024 and now this company has $4 billion of cash.
• 22:20
  It might have more cash than SpaceX at this point, which
• 22:23
  which is a real possibility. And so with that type of balance
• 22:27
  sheet, you think about it from Scott and A Bell's perspective,
• 22:30
  100% of their economics, 99.999% of their economics are in stock.
• 22:37
  So they're not doing anything that doesn't increase the
• 22:40
  terminal value of their stock. They're very rational people.
• 22:44
  So when they're raising money like this, it's for one reason.
• 22:47
  They see an opportunity to invest and they view that as MPV
• 22:52
  positive growth. Again, very highly rational
• 22:56
  people, they can see, you know, we see these things.
• 22:59
  You know, the 1st 20 minutes I've been talking, we've just
• 23:02
  been talking about expanded town revenue ramp, new opportunities,
• 23:09
  things we hadn't necessarily known to be totally true that
• 23:12
  are turning out to be true in terms of the revenue
• 23:14
  opportunities, things that might require different shells of
• 23:18
  satellites. So it's not like we're
• 23:22
  questioning could these things be possible, we're seeing them.
• 23:25
  So then you know us as the Space Mob board of advisors, we would
• 23:30
  have also likely green lighted this if presented with the
• 23:34
  opportunity. And that's how I, I think about
• 23:35
  it is put myself in the position of a board member and executive
• 23:39
  and to explain what is, what is the right thing to do and do it.
• 23:44
  So the right thing to do was not to repeatedly downgrade ASTS
• 23:50
  stock as Scotiabank found out. And so a bell slipped this guy a
• 23:55
  good old Lyman protein shake. And now Scotiabank has some
• 24:02
  static nerve damage too because they were kicked off the books
• 24:05
  of now what is a prolific multi issuer monster, which is a fee
• 24:12
  machine. And look at here who was added
• 24:17
  my favorites, JP Morgan and Morgan Stanley, the truest names
• 24:24
  in finance. And so now we've wet the whistle
• 24:28
  of the big dogs. So when when they put out
• 24:31
  research, which they should at some point expect some exciting
• 24:35
  things, they will yet further brought in our shareholder base.
• 24:39
  We're no longer at the point where having a research report
• 24:41
  is going to like double the stock price, presumably because,
• 24:44
  you know, we're already a pretty big company, but it just starts
• 24:46
  to provide just more, more flow going our way.
• 24:51
  And I particularly love Morgan Stanley.
• 24:53
  I really enjoy reading Adam Jonas's work.
• 24:57
  He's a he's, he's truly a creator.
• 25:00
  He's he's a very interesting individual with lots of great
• 25:05
  out there ideas which have tended to be right.
• 25:07
  And so I really hope he picks this up and sees this broader
• 25:12
  opportunity that is that we all see and shares that with the
• 25:16
  world. And that's the type of voice I'd
• 25:18
  like to be telling him a story for our company.
• 25:21
  And I really hope that happens. He he's just a an incredibly
• 25:24
  gifted analyst who no longer seems to really give a crap what
• 25:28
  other people think. So he's going to just do what's
• 25:31
  what's interesting and what's right.
• 25:33
  And I think ASTS is both interesting and right.
• 25:36
  So hopefully he'll come at that same conclusion.
• 25:40
  Well, the convert wasn't all we got.
• 25:43
  These guys also hit the ATM. So that was the other bridge for
• 25:47
  cash. And so they've really just been
• 25:50
  raising what they can when they can at levels that are frankly
• 25:54
  not very dilutive, which is great for us.
• 25:56
  And so we own, you know, that not the exact math in front of
• 26:00
  me, but you know, all, all own, you know, effectively 90% of my
• 26:04
  economic interests that I had before, you know, the recent
• 26:07
  couple dilution events. But now I have the benefit of $4
• 26:12
  billion of capital to go out and conquer the world.
• 26:17
  And ultimately the math that will prevail is, you know, what
• 26:21
  multiple of book value does ASTS trade.
• 26:24
  And so for a company like this, it's high IP driven, high
• 26:28
  defensible notes, it can be some stupid ratio of like 30 to 1
• 26:32
  price to buck. This is not a bank which trades
• 26:35
  it one times buck. And so there can be some crazy
• 26:40
  accretion for properly invested capital to the extent it
• 26:44
  provides and cements strong competitive modes and scaling.
• 26:48
  So that's how you'd really want to think about these.
• 26:50
  Again, think like an owner. It's the most potentially the
• 26:54
  most powerful change of mindset you can have to improving your
• 26:58
  investment results because you really start to think like a
• 27:00
  board member and that can help you calm down so you don't do
• 27:05
  the wrong things at the wrong time.
• 27:08
  And now let's look at what's happened with the previous
• 27:11
  capital raises. So the Stoic capital did a
• 27:16
  little recap down memory lane of prior prices.
• 27:19
  They quote UN quote, deluded us at $3.10.
• 27:23
  I remember that vividly, definitely in that moment gave
• 27:25
  Scott a piece of my opinions on that one.
• 27:32
  Don't know if he'll ever forgive me.
• 27:33
  And then we we the company raised AT47555575 and then boom,
• 27:40
  72 O seven. I think he missed one because I
• 27:42
  think there was a convert done at 60, although he might be
• 27:47
  doing the cap call in that math. But the company, as the market
• 27:53
  readjust, just keeps going up after each capital reason.
• 27:56
  And why is that? Because the company's delivering
• 27:58
  into this profitable MPV of future growth.
• 28:02
  So think of like a Indy 500 race.
• 28:04
  We're zipping along at 200 miles an hour and things are good.
• 28:08
  And then we go in the pit, the pit stop, and everyone's like,
• 28:11
  Oh my God, now we're going 0 miles an hour, this sucks, blah,
• 28:13
  blah, blah, blah, blah. Well, yeah, we got new tires and
• 28:16
  some gas room. We're back, out, back out again.
• 28:20
  And so these pit stops, think of it as like a high performance
• 28:23
  car like yeah, sure you're you're taking the speed down
• 28:25
  because you are doing a pit stop.
• 28:27
  But this allows you to go the distance and don't lose
• 28:30
  perspective of that when you are in a growth capital raising
• 28:36
  cannonball that we're in. If you're in distress and you're
• 28:39
  raising money, but it's sort of a long goodbye, that's a
• 28:42
  different type of pattern. That's not the pattern we're in
• 28:45
  right now. We are no longer funding to
• 28:49
  mitigate downside risks. We are funding to capture upside
• 28:54
  opportunities. And so this is where Katzie was
• 28:57
  kind of going in his nice tweet on the fancy news is we turn the
• 29:02
  largest remaining technological risk, which is the unfolding of
• 29:06
  FM one. And the company then, you know,
• 29:08
  turned around and did the convertible bond offering from
• 29:12
  the perspective of a convert holder, they're just like, OK,
• 29:15
  let's wave this thing in. They just de risk this thing
• 29:17
  even even more. Let's give them money.
• 29:20
  This is a great convertible bond.
• 29:21
  It's super volatile stock, good credit because there's so much
• 29:24
  cash, IP and all these contracts and things like that.
• 29:28
  And they are just building the war chest now.
• 29:35
  But I think the key thing is to think we're no longer funding to
• 29:38
  de risk. We are funding to chase
• 29:43
  opportunities and that's a big paradigm shift.
• 29:47
  And then of course if you like the Audible version of that and
• 29:51
  Pay Man did a spaces which is also linked here.
• 29:56
  So there was some interesting new language here.
• 29:58
  But first one of the things that seemed to pop out was potential
• 30:02
  M&A talk. And it's a little murky here
• 30:04
  because M&A can just relate to the Logato deal.
• 30:07
  But I've thought for a while and I've said this is I thought
• 30:10
  Iridium could end up being a pretty interesting target and I
• 30:14
  don't know if there will be a deal.
• 30:16
  I don't have a position in Iridium presently, but I thought
• 30:20
  that it kind of set up to be a logical acquisition target since
• 30:25
  Iridium I think is on a path to obsolescence.
• 30:28
  I think it seems like a cigar butt trade to me.
• 30:31
  I don't think their current constellation has any value in
• 30:35
  the long term, but their current book of business does.
• 30:40
  And their spectrum seems to also have value.
• 30:44
  And then they have a big global infrastructure.
• 30:48
  So I, I don't know, but there's satellite operational control
• 30:51
  centers and things like that for all I know, could be valuable
• 30:55
  there. There are ground stations could
• 30:57
  be valuable, I don't know. This is the type of thing that a
• 31:00
  diligence team from ASTS would know and that if some of those
• 31:04
  things flip to positive, buying an Iridium could really
• 31:07
  accelerate our path. And that's something that I
• 31:10
  would certainly be open to as if I had a vote, I don't.
• 31:13
  But spiritually, I'd be excited if they saw that an acquisition
• 31:21
  of Iridium was an accelerant to great things.
• 31:26
  So for the thing that gets me thinking is just buying that
• 31:29
  book of business and then you you kind of run off the Iridium
• 31:34
  business on the current constellation until you have
• 31:36
  your own app and you transition all those contracts to your
• 31:38
  satellites if that's technologically feasible.
• 31:41
  And then you can upsell people too because all of a sudden
• 31:43
  instead of a narrow band service, it's full broadband.
• 31:46
  In the meantime, you get $500 million a year of EBITDA, which
• 31:49
  is pretty exciting and the global spectrum like it really
• 31:52
  pave the way for global L band and S band.
• 31:55
  So there seem like the 15 second elevator pitch makes a lot of
• 31:59
  sense. If if I were a banker, I feel
• 32:01
  like I could kind of fake it till I make it on that.
• 32:04
  But we'll we'll see. But the language is what really
• 32:07
  caught a lot of people's attention.
• 32:10
  So ASC Space Mobile intends to use the net proceeds for general
• 32:12
  purposes, blah, blah, blah, including monetizing the
• 32:18
  capabilities of our proprietary technology to capture evolving
• 32:21
  commercial opportunities related to artificial intelligence and
• 32:29
  then pursuing opportunistic investments to accelerate Space
• 32:32
  Mobile servicing capabilities. So that's where the Iridium part
• 32:35
  comes in to me. And so they could very easily be
• 32:39
  engaging in a spectrum lease deal with Iridium.
• 32:41
  That's kind of the most logical thing, but then actually kind of
• 32:45
  putting it out there on the AI data centers in space.
• 32:51
  So monetizing our capabilities, what does that mean?
• 32:54
  So does that mean they're going to do it?
• 32:56
  That doesn't seemed like how I'd write that sentence.
• 33:00
  Where my head went was partnering with Blue Origin to
• 33:05
  either build the satellites for them or lease the royalty rights
• 33:11
  for the mechanism that allows you to put such large solar on
• 33:16
  orbit power for that. That's that's what I read that
• 33:19
  to be, but we'll, we'll find out.
• 33:23
  But something's happening. That much is clear and the
• 33:26
  timing of it is unclear. Unclear also why they need
• 33:30
  capital for it. But you could say that perhaps
• 33:34
  to fulfill that line of business, they're investing in
• 33:37
  additional plants that would be dedicated to that type of use
• 33:41
  case. And that's exciting.
• 33:43
  You certainly don't need a billion dollars for that but it
• 33:46
  they're giving you tell tales that there's a lot going on here
• 33:51
  and importantly to have anything go on, you need the regulatory
• 33:56
  path to be cleared and Welt Sir, Bloomberg put out an all caps
• 34:01
  tweet kind of keeping a surprise of what's going on in the world
• 34:03
  and went Senate Commerce Committee approves bill to speed
• 34:07
  approvals of new satellite launches.
• 34:09
  So the FCC is humming. Just make sure you're following
• 34:13
  Justin at just bar because he's, he's really our FCC guy now does
• 34:19
  a great job keeping us all updated on recent filings.
• 34:24
  And so he'll be the one that's going to tell you when we get
• 34:27
  our full SES approval, which I think should be forthcoming
• 34:31
  within a a month or two. We got the St. as and so that
• 34:35
  seems like a bridge to the final thing.
• 34:38
  The indices are increasingly including us, which is kind of
• 34:42
  the same as getting like big broad research coverage from new
• 34:46
  banks. It just is going to increase the
• 34:49
  amount of float that gets sucked up.
• 34:51
  So as a index includes our stock, that just means more
• 34:56
  passive guys are just going to buy it.
• 34:57
  That's that's effectively just float reduction.
• 35:00
  Those shares get gobbled up. They sit there and net, net, the
• 35:05
  stock price moves because someone actively decides to buy
• 35:08
  or sell. If shares are just kind of
• 35:10
  locked up in an index, you know, less, less dramatic.
• 35:14
  And so as we have, you know, more and more indexing, that's
• 35:17
  just more shares that are gobbled up.
• 35:20
  And at the end of the day, this is largely supply and demand
• 35:23
  provided that there is something of value, which I believe there
• 35:27
  to be. So nice to see that happening.
• 35:30
  Meanwhile, SpaceX lowers its sights to just the moon.
• 35:35
  And So what does that mean? Not a whole lot.
• 35:40
  I never really understood how Mars was an investable concept,
• 35:43
  but SpaceX is seemingly kind of retooling its pitch and position
• 35:50
  ahead of its ultimate prospectus.
• 35:52
  And so their story now seems to be Starlink, which is a great
• 35:56
  story, although, as Tim Farrar pointed out, the growth curve
• 36:01
  went from convex to slightly concave in the past three
• 36:05
  months. But I don't think I'd be quick
• 36:07
  to write Starling's obituary. They seemingly have kind of
• 36:10
  abandoned the D to C hype because I think they're
• 36:13
  realizing that they don't have a great story.
• 36:16
  TBD what they end up doing with the spectrum.
• 36:17
  Will be very interesting to see if they do close.
• 36:20
  And then with the XAI deal, clearly they're going all in on
• 36:24
  this mega Tam story. Whether it economically is
• 36:29
  feasible or not is the bazillion dollar question.
• 36:32
  But exciting it is, You know, a million satellites, AI from
• 36:37
  space. Screw Sam Altman because he
• 36:40
  doesn't have a space company. I know Elon gets a lot of fun
• 36:43
  from that fact. But we're going to kind of see
• 36:46
  the evolution of the SpaceX IPO in real time, which should
• 36:51
  should be powerful for our stock as more people get up to speed
• 36:55
  on space. Understand why it's exciting and
• 36:58
  ultimately then figure out what's what stocks are are
• 37:02
  relevant to this, this ecosystem.
• 37:05
  And I think we're going to be front and center.
• 37:07
  But that's all I have for this week's, I guess show, if you
• 37:11
  will. And I'm not that people should
• 37:14
  ever ask me or or take action on any predictions I have because
• 37:18
  I'm really not a good, I'm not a good trader.
• 37:21
  But I would just take a little bit of perspective.
• 37:24
  And again, to say they did a big convert, it does take a little
• 37:27
  bit of time for the market to absorb these shares.
• 37:30
  Have we seen the stock price low?
• 37:33
  I'm pretty jumpy guy. So I kind of took the bet, yes,
• 37:36
  because patience is not my middle name when it comes to my
• 37:41
  anxiety about not having the bite to buy Asts when it goes
• 37:48
  down. So I added on Friday a little
• 37:50
  bit. But it would be a reasonable
• 37:52
  thing to say that this week could be some chops and some
• 37:55
  churns as those shares kind of find their natural holders.
• 37:59
  Just remember, when you issue a bunch of converts, shorts get a
• 38:02
  locate. So they borrow shares from, you
• 38:04
  know, people like us. They sell those shares as a
• 38:07
  hedge, though someone has to buy those shares when they go put on
• 38:10
  their short. And so whoever buys that, it's
• 38:13
  usually not Fidelity sitting there and locking those shares
• 38:15
  up forever. It's going God knows where and
• 38:18
  ricocheting around the market until it ultimately gets, you
• 38:21
  know, landed and, you know, tucks his account.
• 38:25
  You know, it's, you know, some guy that's going to hold it with
• 38:28
  Iron Death grip forever. And that's why these things can
• 38:32
  have some volatility and some chop for a little bit.
• 38:36
  But generally the convert price is sort of observed.
• 38:41
  So the issue price, which I think was $96.00, that tends to
• 38:44
  sort of be absorbed within 5 to 10 days.
• 38:47
  That's historically what's happened.
• 38:49
  And so that would put, you know, week after next as like a
• 38:53
  statistician's bet on when we might have absorbed that and be
• 38:56
  back on our March higher. It also is conveniently timed
• 39:02
  toward when we're going to be within spitting distance
• 39:05
  potentially of FM 2 being launched, tracking that really
• 39:08
  carefully. I am really excited for that.
• 39:12
  I just really hope I can go and seen a new Glen Rocket is going
• 39:17
  to be really inspirational for all of us and just super cool.
• 39:21
  And then we should also be getting very close to batch 1
• 39:25
  getting shipped that should, I would really imagine that will
• 39:29
  be sometime in early March. And those are the type of events
• 39:32
  that get people back, back on track.
• 39:34
  They start to see the rapid operational execution that's
• 39:38
  going to lead to the inevitable commercial execution.
• 39:40
  This is still very much a 2026 story that's very important for
• 39:44
  the company to hit and maintain. So we're not pushed back on like
• 39:47
  well, I don't really have to do anything until 2027.
• 39:50
  It's just that's the worst when you flip the calendar relevancy
• 39:55
  of a stock. This is still, knock on wood,
• 39:59
  very much a 2026 story where people can research the stock
• 40:03
  and expect to get paid on the stock this year.
• 40:06
  And that all holds true. So I would just you know,
• 40:09
  reflect a little bit if, if the stock doesn't necessarily go
• 40:13
  straight up next week or this week.
• 40:15
  Maybe it will, but just keep in mind it does.
• 40:18
  There is some technical stuff that just has to be absorbed
• 40:20
  with these converts. Don't freak out.
• 40:23
  Look at your diligence and just remember that sometimes in the
• 40:26
  short term with supply and demand, if the stock, if the
• 40:29
  company issues a lot of stock, it's, it's not like you're
• 40:32
  wrong. It's not like the stock doesn't
• 40:33
  love you. It's not like management's out
• 40:34
  to kill you. It's just they increase supply
• 40:38
  and that has to be absorbed. And price is the mechanism by
• 40:41
  which stock is absorbed, and then it gets absorbed and then
• 40:44
  we go back and things are good. So thank you, everyone for
• 40:48
  joining. I hope everyone has a really
• 40:50
  nice President's Day and I look forward to talking to everyone
• 40:56
  next week. Bye.
• 40:59
  Thanks for listening to the AST Space Mover podcast.
• 41:03
  If you enjoyed this episode and you'd like to help support the
• 41:06
  podcast, please share it with others, post about it on social
• 41:09
  media, or leave a rating and review.
• 41:12
  To catch all the latest news about AST Space Mobile, make
• 41:15
  sure to subscribe. Thanks again and I'll see you
• 41:18
  next. Time.
• 41:22
  We're doing something very, very big and acting with this
• 41:25
  technology we can really affect a billion lives.
• 41:27
  AST Space Mobile is the only company that has proven
• 41:31
  technology to deliver several mobile connectivity directly to
• 41:36
  the everyday. Smartphone.
• 41:39
  People will just basically turn their phone and be seamless,
• 41:42
  regardless of where you are. We don't want the user even to
• 41:45
  know that it's connected by satellite.
• 41:48
  Our role is to bring this into reality, always in partnership
• 41:51
  with the MMO Listen. Waffles.