AST SpaceMobile Q1 2025: Execution Builds, Revenue on the Horizon
Taking a Look at AST SpaceMobile's (ASTS) Earnings Results.
AST SpaceMobile (ASTS) just reported its Q1 2025 results, showing steady progress in building out its space-based cellular network. The company is still pre-revenue in a traditional sense, but early signs of monetization are starting to appear. Management delivered a confident business update highlighting successful technology demos, a very strong launch schedule, and a fortified balance sheet to fund its mission. Here’s a recap of the quarter’s key takeaways and what they mean for investors.
Q1 2025 Financial Results
Minimal revenue (as Expected) ASTS recorded only about $0.M in revenue for Q1, up slightly from $0.5M a year ago. This revenue came primarily from initial gateway equipment sales to telecom partners & completing a few government contract milestones. Meaningful service revenue from the SpaceMobile network is not yet flowing, and wasn’t anticipated this early, so the tiny top line is not a surprise. The company is still essentially pre-commercial as it builds toward launching services.
The Q1 net loss was $63.6M, considerably higher than the $39.8M loss in Q1 last year. Opex has climbed with the rapid scaling of satellite production and R&D. Engineering & development costs rose sharply as ASTS pushes to manufacture satellites and network gear at a larger scale. While hefty losses are normal at this stage for them, investors should note the cash burn and expect it to remain high through the deployment phase. The company is spending aggressively now to accelerate its network rollout, which it believes will pay off once service revenue kicks in.
A big highlight this quarter is ASTS’s strengthened balance sheet. The company finished Q1 with $874M in cash/equivalents, up from about $565M at year-end. In January, ASTS raised $460M through a convertible notes offering (due 2032 at 4.25% interest), giving it a significant influx of capital. It also issued 2M shares via its at-the-market program during the quarter, adding roughly $55M net. This is critical for them because it should fund ASTS’s near-term launch schedule and operations well into 2024/2025. Management stated they have sufficient liquidity for at least the next 12 months of planned spending. Essentially, ASTS bought itself more runway to get the network off the ground without needing to tap equity markets again imminently. (The flip side here is some future dilution is now baked in via the convertible, but the conversion price is around $27/share, well above the current stock price.)
While ASTS hasn’t provided actual formal revenue guidance, the company did outline an initial revenue opportunity of $50M–$75M in 2025, heavily weighted to the second half. This implies they anticipate commercial service starting to generate sales later this year as more satellites become operational. Management noted that actual revenue will depend on hitting deployment milestones, but investors finally have a rough target to watch. In Q1 the company booked $13.6M in new orders for ground network equipment from partners (with roughly $10M per quarter in such orders expected going forward). These bookings are a precursor to service revenue, telecom partners buying gateway infrastructure ahead of offering SpaceMobile service to their subscribers. ASTS will recognize the revenue on these as equipment is delivered and installed. Beyond that, government contracts are another early revenue source: the company highlighted a $43M contract with the U.S. Space Development Agency (SDA) and a new contract worth up to $20M with the Defense Innovation Unit, which together should convert to multi-million-dollar revenues over the next year or two. The main takeaway is that ASTS’s first trickle of revenue has arrived, and management is confident a bigger ramp will begin by year-end 2025 if all goes to plan.
Business & Operational Updates
ASTS made tangible progress on the technical & commercial front. Here are the key updates from the quarter:
Satellite Launch Schedule Accelerating: The company announced a multi-launch plan to rapidly deploy its constellation. Five launches are contracted over the next 6–9 months. In fact, ASTS already has 6 satellites in orbit today (its BlueWalker 3 test satellite plus five commercial “BlueBird” satellites launched last September). The first next-generation BlueBird (Block 2) satellite is slated to launch in July 2025, kicking off a cadence of launches every month or two through 2025/2026. ASTS aims to have 60 satellites deployed by the end of 2026, which would enable continuous global coverage in key regions. The faster ASTS can get coverage up, the sooner it can start serving paying customers.
Manufacturing Ramping Up: To support this launch blitz, ASTS has scaled its manufacturing capabilities. The company is on track to build satellites at a rate of up to 6 per month by Q4 2025. They’ve vertically integrated production of critical components (like their modular “micron” phased array panels and a custom ASIC chip for signal processing). That 95% vertical integration should help control costs and reduce dependency on suppliers. By Q3 this year, ASTS expects its phased array and electronics production to reach the volume needed for the planned satellite output. This is important execution, as any hiccups in manufacturing could bottleneck the whole rollout. So far, ASTS says it’s meeting its internal targets on this front.
Major Technical Milestones|First Broadband Calls: Perhaps the most exciting updates were the successful live demonstrations of ASTS’ satellite cellular service. In Q1, the company and its partners achieved two-way 4G LTE broadband calls and video streams using ordinary smartphones connected via satellite. This past February, Japan’s Rakuten Mobile showed a live video call in front of an audience, using ASTS’s satellite overhead, no special phone or hardware required. This follows similar test calls conducted with AT&T and Verizon in the U.S., and Vodafone in Europe in late 2024. These demos proved that ASTS’s space-based network can deliver voice, video, and data directly to standard mobile phones. It’s a world-first capability unlike legacy satellite-phone services or simple text messaging satellites, ASTS achieved real broadband connectivity for everyday devices. The next step is scaling from one-off demos to initial commercial service in select regions. ASTS indicated it plans to activate pilot services in the U.S., Europe, and Japan on a limited basis once a few more BlueBird satellites are in orbit (using partners’ licensed spectrum in those regions).
Growing Partnerships/Contracts: ASTS’s strategy heavily relies on teaming up with mobile network operators (MNOs) rather than going direct to consumers. That approach continued to bear fruit. The company now has agreements with over 40 wireless carriers globally, including giants covering 2.4B subscribers. During Q1, it deepened ties with key partners: for example, Vodafone & ASTS have formed a joint venture (SatCo) to deploy satellite coverage in Europe. On the government side, ASTS’s technology is gaining interest for defense and emergency applications. The $43M SDA contract (for testing satellite-to-mobile with the U.S. Space Force) and the new $20M DIU contract (covering multiple U.S. agencies) show that ASTS’s dual-use potential (commercial/government) is being recognized. These contracts not only bring in some revenue but also validate the platform’s value.
This Q1 2025 showed strong execution by ASTS. The company is hitting its manufacturing and launch milestones, proving its technology in real-world tests, and securing the alliances and funds needed to move forward.
My Take
I come out of Q1 encouraged by ASTS’ progress, yet still cautiously optimistic. The company is executing about as well as one could hope at this stage. They’ve validated the technology (proving that 4G/5G calls from space to normal phones are possible). They’ve lined up big-name partners and customers eager to use the service once available. They’ve secured a hefty cash runway to get through the next year or two of deployment. And the planned launch pace indicates a sense of urgency and focus on reaching commercial service quickly. These are all signs of strong execution by management.
However, I continue to stress that the next big test is revenue generation. It’s one thing to make a few phone calls via satellite; it’s another to convert that into a sustainable, sizeable business. The back-half of 2025 will be pivotal, ASTS needs to begin monetizing its network, even modestly, to prove the business model. I’ll be watching the rollout of initial services with carriers: How many end-users opt in? What pricing and revenue-sharing looks like? Do we see evidence of real demand (people using it, even if just as a “coverage add-on” to their cell plans)? Successful tech demos are necessary but not sufficient for success, commercial uptake is the real prize. Until ASTS shows a clear path to, say, tens of millions in recurring revenue, some skepticism is warranted. The company’s wide cash burn also means it eventually must refill the coffers or start generating cash from operations in a few years. The good news is ASTS now has time and money to make that happen, but the clock is ticking to turn great science into a great business.
On the competitive front, the landscape is evolving fast. AST SpaceMobile may be the first to achieve space-based cellular broadband, but it won’t be the only player for long. I must mention the obvious elephant in the room here, SpaceX’s Starlink has announced plans for a “direct-to-cell” service in partnership with T-Mobile (aiming to enable basic text messaging nationwide via satellites as early as this year). Starlink has already launched hundreds of satellites that could support that capability, though their initial focus is on low-bandwidth texting and emergency use, not full broadband voice/data. Lynk Global is another startup already testing satellite texting with carriers. Even Apple and Globalstar are enabling emergency SOS messaging on iPhones via satellite (not worried about all others mentioned, except for SpaceX). But this idea of connecting regular phones via satellites is no longer science fiction, it’s becoming a new sector, and ASTS will have competitors.
That said, I believe ASTS retains a lead in the direct-to-phone broadband niche. Starlink’s direct-cell plans (and others) are so far limited to SMS and very low data rates, whereas ASTS has demonstrated streaming video/phone calls. ASTS’s approach of partnering with MNOs and using their spectrum also gives it a regulatory and go-to-market advantage in many countries (where an outsider like SpaceX might face hurdles). In the near term, ASTS is ahead in tech capability and has a clearer path to integration with existing mobile networks. But SpaceX is obviously a strong competitor with deep pockets and engineering talent (this needs to be acknowledged), if they set their sights on full-blown satellite-to-phone broadband, the race could tighten. I’ll be watching Starlink’s moves closely, but I don’t see them leapfrogging ASTS overnight. More likely, we’ll have a couple of years where ASTS can establish itself in its niche before any equivalent competitor service comes online.
I remain optimistic that AST SpaceMobile is on the right track. The Q1 report reinforces my belief that this company has tremendous potential and is methodically de-risking its venture QoQ. I’m impressed with management’s focus & execution thus far, but there needs to be consistent execution from here on out. As an investor, I’m also realistic, there’s still a long way to go, and things like customer adoption, revenue ramp, and competitive dynamics are uncertainties that we need to monitor. I plan to keep my position in ASTS (sized appropriately for a speculative play) and possibly add on dips, but I’m doing so with eyes wide open to the risks. If they succeed, the upside could be enormous (connecting billions of people and commanding a unique global service). If they fail, the stock could languish given the high costs and competition. Strong execution has gotten AST SpaceMobile this far, now let’s see if they can keep it up & start turning that execution into financial results in the coming quarters.