Spire Global Inc at Canaccord Genuity NewSpace Investor Summit Transcript

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

Question: Austin Moeller - Canaccord Genuity - Analyst : Absolutely. So I think probably a good place to start is this morning's announcement that the company put out about your $59 million IDIQ contract with NOAA for weather data procurement. Maybe if you could just go into some details about that. And does this replace or is this supplemental to the six months contracts that they've been signing over the past year, like the latest one was for $10 million?

Question: Austin Moeller - Canaccord Genuity - Analyst : Awesome. Great summary there. And for those in the audience that are maybe not as familiar with GPS, radio occultation, and GPS reflectometry, can you talk for a moment at just about how the LEMUR constellation is able to use its instruments to collect precise temperature, pressure, moisture, and sea ice thickness data?

Question: Austin Moeller - Canaccord Genuity - Analyst : Thanks for the overview there. So as you've mentioned when you talked about the NOAA program, NOAA has over a $2 billion budget for third-party weather data collection. So can you just talk a little bit about the budgets at both NASA and NOAA for collecting weather data? And then also, the associated international data sharing rights that they have to pay a premium for in addition to their own consumption?

Question: Austin Moeller - Canaccord Genuity - Analyst : And also, the Air Force procures weather data as well from third parties for its own forecasting purposes. Correct?

Question: Austin Moeller - Canaccord Genuity - Analyst : Awesome. So yeah, I guess to summarize, there's a tremendous TAM there, whether you look at the multibillion-dollar NASA budget or NOAA budget. And the latest contract that Spire's operating under as of the start of January was about a $10 million contract and then there was the $59 million IDIQ that was announced today from NOAA. So definitely, great opportunities there for Spire to expand its share of wallet with both the agencies relative to where it's at today.

Question: Austin Moeller - Canaccord Genuity - Analyst : And just on the point that you had there about the demand from NOAA and NASA scientists for more RO profiles, what technological improvements have you made to the LEMUR constellation over time to get to 20,000 RO profiles now? And what do you need to do to get up to 100,000?

Question: Austin Moeller - Canaccord Genuity - Analyst : Awesome. Peter, that was a really great deep dive on what sort of changed in the small sat industry over the past decade. So I guess just the key takeaway from that is, to get from where you are at today with the constellation producing 20,000 profiles to an objective of 100,000, part of it will be accomplished through software upgrades. And then, I assume, a component will be accomplished through launching some of the new LEMURs this year?

Question: Austin Moeller - Canaccord Genuity - Analyst : Fantastic. If we pivot for a moment and we talk a little bit about AIS data or maritime vessel tracking for those that aren't familiar with it. Within that industry, can you talk about some of the commercial shipping and fleet broker companies that are paying for AIS data and using that to track fleets and also preparing it with the company's weather data in their API?

Question: Austin Moeller - Canaccord Genuity - Analyst : Excellent. Definitely sounds like another very large TAM opportunity for Spire to capitalize on. If we talk for a little bit about radio frequency signals intelligence or SIGINT, within the past couple of years, your company has upgraded its constellation to be able to look for signals intelligence, RF signals, and to be able to geolocate them for government customers. So just kind of question from the audience here, do you expect more signals intelligence customers in the future or do governments have what they need in terms of that capability?

Question: Austin Moeller - Canaccord Genuity - Analyst : Excellent. Very exciting as a new growth opportunity for the business. If we go back to space services for a moment, over 2,400 satellites were launched last year and 96% of those satellites were small sats with a mass of under 600-kilogram. Just given that Spire's space services business is extensively involved in bespoke satellite constellation, manufacturing and payload hosting capabilities, what are the latest trends you're seeing in small sat production demand in that angle of the market? 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 27, 2023 / 3:00PM, SPIR.N - Spire Global Inc at Canaccord Genuity NewSpace Investor Summit

Question: Austin Moeller - Canaccord Genuity - Analyst : Spire is one of just a handful of new space satellite operators, but it's completed building out its constellation and is in the replenishment or maintenance CapEx phase. If I looked at the latest date, it's one of approximately four constellations that are built out and are just now in the maintenance phase. So can you talk a bit about Spire's huge competitive moat? Who do you consider to be the key competitors now?

Question: Austin Moeller - Canaccord Genuity - Analyst : I have another question from the audience here, and this might be a good opportunity to explain the difference in your ARR Solution Customer and subscription service models. But the audience asks, what is the share of subscription data, subscriptions versus one-off research-type customer contracts, which I assume are mostly in space services?

Question: Austin Moeller - Canaccord Genuity - Analyst : If we just talk about Spire's business for a minute, can you underscore how Spire only expects to have CapEx needs to maintain the LEMUR constellation in that $10 million to $12 million, $10 million to $15 million range every year at this point? And how you expect to be free cash flow positive in, now, what's probably the next 11 to 17 months?

Question: Austin Moeller - Canaccord Genuity - Analyst : Next one. Thanks for the details on that. I've got one more question here from the audience. It sounds like the person asking the question, they want to better understand how bus or satellite production for a customer within space services is considered a subscription recurring revenue? And they want to understand -- they understand that the rental of payload capacity on a satellite, how that could be considered subscription. But how much of that revenue is truly subscription based? And basic math says there are 99.4, if, truly subscription yields, versus 24.8% in March guidance of 21.7 to the 23.7. 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 27, 2023 / 3:00PM, SPIR.N - Spire Global Inc at Canaccord Genuity NewSpace Investor Summit

Question: Austin Moeller - Canaccord Genuity - Analyst : Thanks, Peter. I think that was a really good clarification of just how to think about the space services business in terms of hosting capability and how they're subscribing to that. If we think about Spire's LEMUR constellation, which you often describe as a listening constellation, right? How does the weather data that is being collected by the LEMUR constellation compare with or complement what you can see with satellites that feature an electro-optical telescope or an infrared imager?

Question: Austin Moeller - Canaccord Genuity - Analyst : Great. Definitely good insights there on what types of sensors are most effective for weather data collection. During the earnings call, the company mentioned that you're planning to shift the revenue mix back towards a 50-50 commercial versus government in 2023. And so can you just talk about what you're planning to do operationally to achieve that?

Question: Austin Moeller - Canaccord Genuity - Analyst : Excellent. Thanks for the color on that. So I just have one last question here from the audience. Can you talk a little bit about cash burn this year? And should we expect it to be close to the adjusted EBITDA loss plus the working capital used for LEMUR maintenance? And how should we see that shift over the next 11 to 17 months as you start realizing more customer leverage on the constellation?

Question: Austin Moeller - Canaccord Genuity - Analyst : Fantastic. Well, thank you so much, Peter, for your time today just to talk about Spire and the vision for the company and the LEMUR constellation. I look forward to seeing you hit $100 million ARR in all of your core business segments. And I'll have to read The Goal when I get some free time here. 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 27, 2023 / 3:00PM, SPIR.N - Spire Global Inc at Canaccord Genuity NewSpace Investor Summit