Spire Global Inc Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Austin Moeller - Canaccord Genuity Group Inc - Analyst : Morning. So, just my question for I know you haven't put out any guidance for 2025, but how should we think about the CapEx spend, to launch new satellites just given that some had to be decommissioned or depreciated last year.

Question: Austin Moeller - Canaccord Genuity Group Inc - Analyst : Hi, can you hear me? Yes. Okay, so just my question is, how should we think about CapEx expand for 2025 just given that, some satellites were, decommissioned or, had to be depreciated last year and how should it compare to prior years.

Question: Austin Moeller - Canaccord Genuity Group Inc - Analyst : Okay, that makes sense, so you expect each individual satellite to be less capital intensive.

Question: Austin Moeller - Canaccord Genuity Group Inc - Analyst : Excellent I'll pass it back there thank you.

Question: Jeff Meuler - Baird Capital - Analyst : Yeah, thank you, good morning. I'm just trying to sort through the good year-to-date results and positive bookings trends with what you're saying for Q4 and try to sort through how much of Q4 is kind of like negative variability, so maybe if you can just talk through like the, I mean it doesn't look like there's like great ARR growth coming out of Q3, so just. What all goes into kind of Q4? Have you seen bookings remain strong in Q4 and Q1 just as we think about modelling 2025 absent 2025 guidance at this time.

Question: Jeff Meuler - Baird Capital - Analyst : Got it very helpful. And then just on the go ahead.

Question: Jeff Meuler - Baird Capital - Analyst : Got it. And just to be clear, because you talked about the increased expenses that impact the preliminary results and that'll continue into one that gets added back to adjusted EBITDA under the, I guess exclude other unusual and infrequent cost in the reconciliation, correct?

Question: Jeff Meuler - Baird Capital - Analyst : Got it. And then just on the change in Presidential administration and you called out kind of being more supportive of the privatization of space solutions, can you just address the change maybe holistically, so what have you seen in terms of bookings or dialogue with the US federal government since the election and then anything in terms of. Maybe second order effects, so like I'm reading headlines about lease cancellations planned at some NOAA weather forecasting centres, obviously that's a contracting entity for you, but maybe that actually accelerates the shift to private market solutions. Thank you.

Question: Erik Rasmussen - Stifel Corp - Analyst : Yeah, thanks for taking the question and congrats on getting this whole process wrapped up. Peter, you. I just wanted to follow up with your comments. It sounded, obviously it sounds like Q4 is, going to be a weaker period down. I think, you're looking at around 30% sequential decline, and it sounded like some of the factors that are impacting Q4 could spill in Q1. So, would Q4 be the low point if we're looking at around a $20 million revenue number or we still see some pressure in Q1, in similar levels. And then I guess I'm just trying to understand what that sort of model looks like, right? You said that, look at your past performance up until Q3, but you used to talk about a 20%, 20% plus top line growth and Gross margins of 70% plus obviously with the restatements, margins are being impacted just because of the allocation from OpEx to COGS, but is that still a framework we can think about as we're looking at 2025 and beyond?

Question: Erik Rasmussen - Stifel Corp - Analyst : Great, that's helpful. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:30PM, SPIR.N - Q3 2024 Spire Global Inc Earnings Call

Question: Brian Kinstlinger - Alliance Global Partners - Analyst : Great, thanks so much it's great to see you guys, getting past this process I think unless I didn't hear it, I think the most important question that investors will want to enroll right now is what gives you the confidence you'll be able to close the transaction of the maritime business in six to eight weeks? What's changed that gives you that confidence?

Question: Brian Kinstlinger - Alliance Global Partners - Analyst : Right, I think that counter party is is what's changed and that's that's an important piece. My only other question I have that we haven't heard about since June. There's been Well documented challenges among commercial airlines in the United States right now among safety. Can you talk about the cooperation agreement with Dallas and ESSP to develop the global satellite air traffic management system that's for the aviation market? And then is there similar discussions for upgrades in the US?

Question: Brian Kinstlinger - Alliance Global Partners - Analyst : Great, thank you Peter.

Question: Jeff Van Rhee - Craig-Hallum Capital Group - Analyst : Great, thanks. Apologies for the background noise. A few remaining for me. If you, in terms of the visibility, I hate to beat the horse here in the terms of the Q4 baseline, but is there any based on signings that you already have completed, are there any step function, sort of step ups as large contracts that are already signed come live Q1, '23, any visibility you have to get us a meaningful lift from that, $20 million baseline for Q4 and then you after that.

Question: Jeff Van Rhee - Craig-Hallum Capital Group - Analyst : Okay, and on the 40 million of ACV from Q3, and your com the Canadian wildfire, a great win for you. Can you talk to new and that new ACV signed in '24 because I know that that 40 includes some renewals that would give us maybe a little help also on a forward growth trajectory.

Question: Jeff Van Rhee - Craig-Hallum Capital Group - Analyst : Yeah, that's great. Thanks so much, Leo, and congrats guys. Good to hear the transaction, timeline of 68 weeks and you got some momentum there, so great. Thank you.

Question: Christopher Quilty - Quilty Analytics - Analyst : Thanks Peter. I was hoping, could you perhaps elaborate publicly on that Canadian wildfire deal and the arrangement there with Aurora Tech as the payload provider and where the capital is coming from and who owns and sort of the revenue streams from that particular program and maybe as I back up like with the new space services accounting. Can you maybe give us, and I don't know, I didn't look if there was a side deck that that came with the earnings report have you provided a breakdown of how both the revenue recognition and the cash flow will flow under any changes that you've made to the accounting system there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:30PM, SPIR.N - Q3 2024 Spire Global Inc Earnings Call

Question: Christopher Quilty - Quilty Analytics - Analyst : No, that's helpful. It remains mostly a cash flow neutral during the build phase, just lower revenue.

Question: Christopher Quilty - Quilty Analytics - Analyst : Yeah, also just a clarification, I mean, I heard with regard to the fourth quarter blip, is it more of a blip or a baseline in terms of, if it's guiding to around the 2021, million marks, does it grow from that level, on a go forward basis? I think Peter said, go back, look at our last two year growth rate, and that's where we grow. Or was Q4 meaningfully a blip? In other words, it's in 2021, million, it's lower than the go forward run rate.

Question: Christopher Quilty - Quilty Analytics - Analyst : Understand. Final question just on your optical terminal, I think you said a tissue box, like the cube boxes or are you talking the rectangular one or you know 20% more for free size in terms of the unit itself.

Question: Christopher Quilty - Quilty Analytics - Analyst : No, I was somewhat teasing on the shape, but I guess the important question here, I mean, you at least implied in your script that you've done, connections that up to, 5,000 kilometres, and there was a, GAO report that just came out, whether it was this week or last week, noting the myriad of problems that the optical. A providers are having for the Space Development agencies PWSA constellation, and clearly you're not building to SDA specs, but if you do have a working product, at, high data rates, is this something that you would either offer, on a merchant basis to other satellite manufacturers or something you would keep as a bespoke capability that you would offer to your satellite services customers?

Question: Christopher Quilty - Quilty Analytics - Analyst : So good question, no answer at this point. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 04, 2025 / 1:30PM, SPIR.N - Q3 2024 Spire Global Inc Earnings Call