Hello and thank you for standing by. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Momentus Inc. First Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's call is being recorded. I would now like to turn the conference over to [Mary Horn] (ph). Please go ahead.

Thank you, and hello, everyone. Welcome to Momentus’ First Quarter 2023 Earnings Conference Call. With me here today are John Rood, Chief Executive Officer of the company and Chairman of the Board of Directors, as well as Eric Williams, Chief Financial Officer. Each will provide prepared remarks. Following these prepared remarks, we will take questions from analysts. Earlier today, we issued a press release and made a slide presentation available on our Investor Relations website, which provides an overview of our business and financial highlights for the quarter. You can download a copy of the release and presentation slides at investors.momentus.space. During today's call, we will make certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and. As a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. You should listen to today's call with the understanding that our actual results may be materially different from the plans, intentions, and expectations disclosed in the forward-looking statements we make. For more information about factors that may cause actual results to materially differ from forward-looking statements, please refer to the earnings press release we issued today as well as the company's filings with the Securities and Exchange Commission. Leaders are cautioned not to put undue reliance on forward-looking statements. And the company specifically disclaims any obligation to update the forward looking statements that may be discussed during this call. Please also note that we will refer to certain non-GAAP financial information on today's call. You can find reconciliation of the non-GAAP financial measures to the most comparable GAAP measures in our earnings press release. None of these non-GAAP financial measures is a substitute for or superior to measures of financial performance prepared in accordance with GAAP. With that, I'd like to turn the call over to our Chairman and Chief Executive Officer, John Rood.

Well, thank you, Mary. It's a pleasure to be here today to provide an update on the progress that we've made at Momentus over the past quarter and our Q1 financial results. I'm also pleased to have Eric Williams here for our first -- for his first earnings call as our CFO. After I make my comments, Eric will take you through the financial highlights and the outlook. Turning to Slide 4. In the first quarter, Momentus demonstrated solid progress toward our goal of being one of the market leaders in in-space transportation and infrastructure services for U.S. government and commercial customers. We are at the forefront of this rapidly expanding market, possess key competitive advantages and have confidence in our long term strategy. In my remarks today, I'll focus on four things that fuel my excitement about the future at Momentus. First, our core technology is functional and operational in space. We've come a long way in maturing our technology and we're delighted to be seeing our spacecraft and its key technologies performing in space. With every passing day and orbit of our spacecraft around the earth, we gain more flight heritage and increase this important advantage over competitors that have yet to fly their vehicles in space or sure they can do so successfully. Second, we continue to see growing interest from customers, both commercial and government customers responsible for U.S. national security missions and we plan to translate into contracts over the coming months. Third, we're driving new innovation to maximize our competitive edge and are excited about new capabilities and technology that we will be demonstrating in space in the next few months. And fourth, one of the key reasons why we're confident about our future is the cumulative decades of experience within our veteran leadership…

Thank you, John, for the introduction and kind words. Very much appreciate joining such an experienced team and having the opportunity to contribute towards scaling the business and being key participant and leader in the space infrastructure market. I am pleased to present highlights of the financial results achieved by the Momentus team during our first quarter of 2023. Our first quarter results reflect our ongoing progress and investments towards our future launches. We have cumulatively signed contracts for approximately $33 million in backlog or potential revenue as of April 30, 2023. These contracts include firm orders as well as options. These options give our customers the flexibility to quickly opt into an available launch slot on short notice without requiring a separate agreement. The breadth of these signed contracts spans across 19 companies and 13 countries. Typically, our customers have the right to cancel a flight, reservation and when doing so, will forgo their deposits in milestone payments. Should a customer cancel a contract for their rescheduling needs or other reason before all of its payments are made, the resulting revenue will be less than the full value of the backlog. Momentus has historically included in backlog both firm orders as well as options. These options give our customers the flexibility to opt into an available launch slot without requiring a separate agreement. We ended Q1 2023 with non-restricted cash and cash equivalents of $39 million and approximately $12 million in outstanding gross debt consisting of a term loan that we began to repay in March of 2022. Next, I would like to address a topic that will be mentioned in our 10-Q to be filed with the SEC. Our 10-Q will include language regarding our ability to continue as a going concern. This going concern qualification was determined…

Thank you, Eric. In a moment, we will move on to the question-and-answer portion of our call. I'd like to remind participants that all disclaimers outlined at the outset of this call extend to the question-and-answer session. This includes our disclaimers relating to non-GAAP financial information, forward-looking statements and the technology underlying our planned service offerings. Operator, would you please remind participants how to enter the queue?

Thank you, Eric. In a moment, we will move on to the question-and-answer portion of our call. I'd like to remind participants that all disclaimers outlined at the outset of this call extend to the question-and-answer session. This includes our disclaimers relating to non-GAAP financial information, forward-looking statements and the technology underlying our planned service offerings. Operator, would you please remind participants how to enter the queue?

Thank you. [Operator Instructions] Your first question comes from the line of James Ratcliffe with Evercore. Your line is open.

Good afternoon. Thanks for taking the question. A couple if I could. On the operational side, could you just give us a little more update on the status of the Vigoride 6 mission including the timeline for moving those NASA satellites to the custom orbit and testing of the TASSA array and how long will it be till we know whether both of those worked or not? And second, getting into the financing questions and the like. Can you talk about the potential sources of capital and what the process looks like for finding incremental capital in addition to the efforts to reduce burn to help revenue? Thanks.

Well, thanks for the question James. As you know, as you asked in your question, Vigoride 6 is the third spacecraft that we've launched and put in orbit. We launched that, of course, just under a month ago. And prior to that, we've launched Vigoride 5 in January. And so right now, we're operating both of those two spacecraft concurrently from our mission operations center here, which is just a few steps away from me in San Jose, California. We've now successfully commissioned an operate in space all of the sub systems of the Vigoride 5 orbital service vehicle. And we've also commissioned most of the subsystems of Vigoride 6 with the remainder schedule to be completed in the next few weeks. The reason being that, that was launched three months later than Vigoride 5. Both of the spacecraft though have their solar arrays deployed, they're generating the power normally. We continue to command and operate them through a network of ground stations from a vendor. Now in terms of looking forward on the Vigoride 6 mission which you asked about, it's carrying payloads as you mentioned for four commercial customers and two NASA satellites, we'll first deploy the four satellites for the commercial customers and then we'll proceed to the NASA mission. And in the NASA mission, there is a very unique custom orbit that NASA wants these payloads to be placed in so that they can study the atmospheric density and solar or space rather, I should say, at that location. So it'll take us roughly two months towards the end of July as our plan to transport those payloads there with arrival around end deployment, roughly late July. And then after we finished the deployment of those NASA payloads the next on the docket for the Vigoride…

Thanks, James. And again, I think two parts to your question. With respect to sources of capital, we have been in market and we will continue to be in market in terms of looking at alternatives to raise additional funds and to support our balance sheet. As you would expect, we'll evaluate the timing and structure of those raised within the context of execution of our business plan and certain market conditions. Our S3 as a reference [indiscernible] still provides us some flexibility to raise additional capital using the ATM over the next three years to help us work our way through that. With respect to the other part of your question, we have develop a plan and we are currently implementing such a plan to reduce our operating costs in order to provide us with runway to conduct our demonstration mission and place additional customer satellites in orbit with cash on hand in utilization of our existing balance sheet. And as John noted in his portion of the call, we continue to see a significant amount of excitement from new business, government, commercial. So we expect the fact that we've demonstrated flight heritage and performance that is enabling us to capture new business, therefore expanding our top line. So our plan is a combination of growth in revenue or top line, being judicious on our spend and focusing on operating the platforms that we have, in developing key technologies and resolving certain legal issues that we have in front of us.

Yes, James, just to mention one other thing. Anecdotally, I attended the space symposium in Colorado Springs in mid-April. And if you haven't been, that might be the largest gathering of space industry and customer folks annually that occurs. And one of the things that was really gratifying about that experience is when you sit down to talk to industry veterans or we talk to customers whether they are commercial or government and to hear the positive feedback about how rapidly we've developed and placed our technology in orbit. And while we have that challenges, we've had to overcome the compliments about the speed at which we've done that and particularly people with our space industry veterans. We're really favorably impressed by the rate at which we've done that and the results that we've shown. And then the positive feedback from customers that's translating into a growth and interest. And so our business development sales teams are quite busy right now keeping up with that. But thanks again for the questions.

Thank you.

Your next question comes from the line of Michael Mathison with Singular Research. Your line is open.

Good afternoon, gentlemen. Thank you for taking my call or the question, I mean. Just a couple of questions for you, appreciating that you recognize revenue when there's a deployment. Am I sort of figuring this correct that there will be two deployments in Q2 and an estimated six in Q3?

We just in the past few days completed deployment of the Cosmosis satellite from Vigoride 5. Our plan is to deploy the four commercial satellites onboard Vigoride 6 here in the coming days ahead. And so those would occur in this quarter in terms of as we go forward. That's our contracts are typically structured for revenue recognition. In assuming the NASA payloads are deployed in late January, early July, excuse me, that would be the time at which we would begin to recognize that revenue. Concurrent with that, we have a hosted payload that we are transitioning to operate for Caltech. And depending on how long we operate it for whether it's the six months we're under contract or if they exercise contract option, for up to two years. I mean that would define how we approach revenue recognition on that as well. And then there's some other things that we plan to have begin the orders and then they would obviously, the revenue would follow at a later date following the revenue from the -- excuse me, the order that we take.

Sure. Thank you. I appreciate that later quarters are hard to forecast, so understood. And just in terms of the revenue typically recognized from a deployment appreciating that hosting is different. Am I still correct to work with a figure of about $15,000 per deployment?

Per deployment? No. That -- it would vary -- it depends upon the value of the contract in which we have concluded with that customer. And the value of the contract is heavily dependent on the [indiscernible] the satellite in this case. And so, the larger satellites have a higher price hence because they have a larger mass and the smaller ones would be different. So I would not assume the same amount of revenue per satellite as a result.

Got it. Okay. Very good. So that's very helpful. Thank you for taking the questions.

[Operator Instructions] There are no further questions, and this concludes today's conference call. Thank you for attending. You may now disconnect.