Anterix (ATEX) has been on a downward spiral lately with significant selling pressure. After declining 13.8% over the past four weeks, the stock looks well positioned for a trend reversal as it is now in oversold territory and there is strong agreement among Wall Street analysts that the company will report better earnings than they predicted earlier.How to Determine if a Stock is OversoldWe use Relative Strength Index (RSI), one of the most commonly used technical indicators, for spotting whether a stock i ...

Financial Data and Key Metrics - The company launched a share repurchase program in September, allowing the repurchase of up to $250 million of outstanding shares over three years [6] - The company expects to receive $53 million in proceeds from existing contracts during the remainder of the fiscal year [6] - Currently, 16 utilities representing approximately $900 million in potential contract proceeds have crossed the demonstrated intent threshold [12] Business Line Data and Key Metrics - Anterix is enabling a nationwide platform for utilities to support a resilient, secure, and clean energy future through collaboration with customers and solutions providers [7] - The Utility Broadband Alliance (UBBA) Annual Summit saw participation from 35 utilities, representing over 60% of Anterix's spectrum value [7][8] - Itron, an Anterix Active Ecosystem member, announced the availability of 900 megahertz compatible devices, enhancing deployment flexibility for utilities [9] Market Data and Key Metrics - The 900 megahertz private wireless broadband is gaining traction, with significant industry focus and executive acknowledgment at events like the UBBA Summit [9][10] - The demonstrated intent scorecard shows positive movement, with seven utilities adding 11 demonstrated intent indicators from August to November [11] Company Strategy and Industry Competition - Anterix is focused on driving the utility industry towards 900 megahertz private wireless broadband, with significant progress in customer engagement and ecosystem development [5][7] - The company is leveraging its share repurchase program and near-term opportunities exceeding $250 million to deliver shareholder value [6][14] - Anterix is actively involved in industry forums and panels, such as the EEI Foundation wildfire mitigation panel, to promote the adoption of 900 megahertz private LTE networks [10] Management Commentary on Operating Environment and Future Outlook - Management remains highly confident in the company's ability to deliver value to shareholders, citing industry movement towards 900 megahertz, utility progress on the demonstrated intent scorecard, and the share repurchase program [14] - The company sees near-term opportunities in excess of $250 million, underpinning its confidence in future growth [6][14] Other Important Information - Wassim Akhdar joined Anterix as Senior Vice President of Product Innovation, bringing extensive experience in delivering innovative solutions to utilities [13] - The company's CatalyX solution, a turnkey subscriber management and roaming solution, was demonstrated at the UBBA Summit, showcasing its potential to enhance private broadband networks [9] Q&A Session Summary Question: Quantification of investment by utilities and ecosystem partners - Anterix estimates that its spectrum represents roughly a third of the spend in network deployment costs, with utilities spending upwards of $150 billion annually on capital projects [17][18] - The company tracks 23 companies with commercial-ready products for 900 megahertz, indicating significant third-party investment in the ecosystem [19] Question: Impact of the Hawaii situation on utility boards - Wildfire mitigation has become a critical focus for utilities, with private LTE 900 megahertz networks being deployed to address these risks [21][22] - The discussion at the EEI Foundation panel highlighted the importance of technology solutions, such as falling conductor protection, in mitigating wildfire risks [23][24] Question: Milestones with Evergy and other contract proceeds - Anterix expects $20 million from Xcel this quarter and $16 million from Xcel and $15 million from LCRA in the March quarter [26][27] - One additional utility representing a $50 million licensing opportunity has moved above the demonstrated intent threshold in the last three months [28] Question: Cash balances, liquidity, and buyback strategy - The company plans to keep $40 million to $50 million in cash to cover annual OpEx, with excess liquidity directed towards the buyback program [30] - The buyback program reflects the company's confidence in near-term opportunities exceeding $250 million [34] Question: Interest in 800 megahertz spectrum and 5G adoption - Anterix is opportunistic about spectrum opportunities, including potential partnerships or acquisitions related to 800 megahertz spectrum [32][33] - Utilities are currently focused on LTE, with future compatibility for 5G through software upgrades, as highlighted by ecosystem partners like Ericsson and Nokia [36][37] Question: Demonstrated Intent (DI) scorecard and Phase III progress - The DI scorecard tracks utilities' progress towards 900 megahertz contracts, with 16 utilities currently above the threshold [12][40] - The DI scorecard provides granularity on utility progress, including contract negotiations and other indicators of intent [41][43] Question: Government spectrum policy and shared spectrum - Anterix is monitoring potential spectrum opportunities, including shared spectrum models like CBRS, but emphasizes the need for control and certainty in utility networks [50][53] - The company believes both shared and exclusive license models will continue to play a role in the spectrum landscape [54] Question: Interest from the satellite industry - Anterix is engaged with leading vendors on potential hybrid terrestrial-satellite solutions, viewing 900 megahertz as a foundational element for future network expansions [56]

Table of Contents Title of each class Trading symbol Name of each exchange on which registered Common Stock, $0.0001 par value ATEX The Nasdaq Stock Market LLC (Nasdaq Capital Market) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________ FORM 10-Q ______________________ (Mark one) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR ...

Financial Data and Key Metrics Changes - The company received approximately $21 million from the first Excel Spectrum milestone for broadband licenses and expects to receive roughly $80 million of additional near-term proceeds based on the delivery of additional milestones throughout the fiscal year [17] - The company remains debt-free and forecasts free cash flow for fiscal 2024 [17] Business Line Data and Key Metrics Changes - The Demonstrated Intent (DI) scorecard indicates that 15 utilities have crossed the DI threshold, representing more than $850 million in potential contract proceeds, with an additional three utilities close to crossing the threshold representing over $275 million [11] - Since the introduction of the DI scorecard, there have been positive movements recorded on about 50 new measurable indicators of intent [11] Market Data and Key Metrics Changes - The utility sector is spending over $150 billion annually in capital expenditures, indicating a significant market opportunity for the company [28] - The Utility Broadband Alliance (UBBA) surpassed 100 members, reflecting growing interest in private broadband networks within the utility sector [14] Company Strategy and Development Direction - The company aims to become the de facto wireless broadband solution for the utility industry, focusing on capturing valuable customer contracts and demonstrating the value of its spectrum asset [6][12] - The company is actively working with the Utility Strategic Advisory Board and the Utility Broadband Alliance to identify and pursue key solutions for current and potential customers [13][14] Management's Comments on Operating Environment and Future Outlook - Management acknowledges investor frustration with the slow pace of the utility sector but remains optimistic about the progress indicated by the DI scorecard [6][26] - The company sees the current market as an opportunity to drive customer contracts and believes that educational efforts on the value of private broadband networks will lead to increased adoption [16] Other Important Information - The company has a share repurchase program with approximately $26 million available, which it plans to utilize efficiently [17] - The company has successfully closed 100% of contracts with the five utilities that have committed to wide area private wireless broadband since the availability of its broadband spectrum [12] Q&A Session Summary Question: What is the appropriate cash balance for the company? - The CFO indicated a preference for a cash balance that covers at least a year of operating expenses, estimated at roughly $40 million to $45 million [20][21] Question: What are the key issues causing delays in the utility industry? - Management explained that the cautious nature of utility customers, the complexity of organizational decision-making, and the need for regulatory approvals contribute to the delays [22][24] Question: Can you provide insights on the water opportunity? - The company highlighted that the utility sector's significant capital expenditures present monetization opportunities, with a focus on expanding use cases in water management [28][29] Question: What government programs are available to help utilities upgrade the grid? - Management discussed various programs, including the BIO IIJ and GRIP programs, which are expected to provide funding over the next few years [33][34] Question: How does the partnership with NRTC fit into the pipeline? - The company views the partnership with NRTC as an opportunity to reach smaller rural co-ops and municipal organizations, expanding its customer base [48][49] Question: What activities are being undertaken by the 100 companies in the active ecosystem? - A third of the companies in the ecosystem are developing broadband-enabled products, indicating a growing interest in the market [56]

[Part I. Financial Information](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Anterix reported total assets of $279.3 million, a net loss of $2.1 million, and a $14.1 million decrease in cash, driven by a $10.8 million gain on intangible asset disposal [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2023, total assets increased slightly to $279.3 million, driven by intangible assets, while cash decreased and stockholders' equity rose to $181.2 million | Balance Sheet Items (in thousands) | June 30, 2023 (Unaudited) | March 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $29,033 | $43,182 | | Intangible assets | $215,795 | $202,044 | | **Total Assets** | **$279,328** | **$278,558** | | **Liabilities & Equity** | | | | Total current liabilities | $32,600 | $31,900 | | Total liabilities | $98,133 | $98,765 | | Total stockholders' equity | $181,195 | $179,793 | | **Total Liabilities and Stockholders' Equity** | **$279,328** | **$278,558** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) For Q2 2023, the company significantly reduced its net loss to $2.1 million from $13.2 million, primarily due to a $10.8 million gain from intangible asset disposal, with spectrum revenues increasing by 81% | Statement of Operations (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :--- | :--- | :--- | | Spectrum revenues | $608 | $335 | | Operating expenses | $14,263 | $14,053 | | Gain from disposal of intangible assets, net | $(10,785) | $(648) | | Loss from operations | $(2,839) | $(13,072) | | **Net loss** | **$(2,118)** | **$(13,196)** | | **Net loss per common share** | **$(0.11)** | **$(0.71)** | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash decreased by $14.1 million to $29.0 million, driven by $8.2 million used in operating activities and $5.2 million in investing activities for intangible asset purchases | Cash Flow Activities (in thousands) | Three months ended June 30, 2023 | Three months ended June 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(8,209) | $(9,832) | | Net cash used in investing activities | $(5,195) | $(6,656) | | Net cash used in financing activities | $(745) | $(2,680) | | **Net change in cash and cash equivalents** | **$(14,149)** | **$(19,168)** | | **Cash and cash equivalents, end of period** | **$29,033** | **$86,456** | [Notes to Unaudited Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Key notes detail a $30.0 million spectrum sale agreement, primary revenue sources, a $10.8 million non-monetary gain from license exchange, and contingent liabilities - In April 2023, the company entered into an agreement with Lower Colorado River Authority (LCRA) to sell 900 MHz Broadband Spectrum for total payments of **$30.0 million** plus the contribution of select LCRA narrowband spectrum[28](index=28&type=chunk) - Spectrum revenue for Q1 2023 totaled **$608,000**, primarily from agreements with Ameren (**$152k**), Evergy (**$274k**), and Motorola (**$182k**)[32](index=32&type=chunk) - The company recorded a non-monetary gain of **$10.8 million** from exchanging **$2.5 million** of narrowband licenses for **$13.3 million** of new broadband licenses in 9 counties[45](index=45&type=chunk) - A contingent liability of **$20.2 million** remains on the balance sheet related to payments received from SDG&E, which are refundable in the event of non-delivery, with a potential delivery delay adjustment of **$0.8 million to $1.3 million** anticipated for the San Diego County license transfer to SDG&E[68](index=68&type=chunk)[69](index=69&type=chunk) - Subsequent to the quarter's end, in July 2023, the company delivered cleared spectrum to Xcel Energy for 14 counties and received a full milestone payment of **$21.2 million**[74](index=74&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes increased spectrum revenues to the Evergy agreement and reduced net loss to a $10.8 million non-monetary gain, with liquidity relying on cash and future customer proceeds [Results of Operations](index=20&type=section&id=Results%20of%20Operations) Spectrum revenues increased 81% to $0.6 million due to the Evergy agreement, while a $10.8 million gain from intangible asset disposal significantly reduced the loss from operations - Spectrum revenues increased by **$0.3 million**, or **81%**, primarily due to revenue recognized from the agreement with Evergy, Inc[81](index=81&type=chunk) - A non-monetary gain of **$10.8 million** was recorded from exchanging narrowband licenses for new broadband licenses in 9 counties, significantly reducing the net loss for the quarter[86](index=86&type=chunk) - General and administrative expenses increased by **$0.3 million (3%)** due to higher headcount and related costs (**$0.5 million**) and stock compensation (**$0.2 million**), partially offset by lower professional service and recruiting costs[83](index=83&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is primarily its $29.0 million cash balance, with material cash requirements including spectrum commercialization, lease obligations, and potential SDG&E and Xcel Energy liabilities - The company's principal source of liquidity is its cash and cash equivalents, which stood at **$29.0 million** at June 30, 2023[93](index=93&type=chunk) - Net cash used in operating activities was **$8.2 million**, and net cash used in investing activities was **$5.2 million**, primarily for acquiring, swapping, or retuning wireless licenses[96](index=96&type=chunk)[98](index=98&type=chunk) - The company anticipates a delivery delay adjustment between **$0.8 million** and **$1.3 million** related to the transfer of the San Diego County broadband license to SDG&E[102](index=102&type=chunk) - As of June 30, 2023, **$26.8 million** remained available under the company's share repurchase program, which expires in September 2023, with no shares repurchased during the quarter[107](index=107&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=23&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risk is inflation, which could increase operating costs and hinder commercialization, while interest rate and foreign currency risks are minimal - The company identifies inflation as a key risk that may adversely affect operating results by increasing costs and potentially slowing customer commercialization efforts[110](index=110&type=chunk) - Interest rate risk is not expected to have a material impact due to the short-term nature of the company's highly liquid investments[108](index=108&type=chunk) - The company is not exposed to foreign currency exchange risk as all operations and transactions are denominated in U.S. dollars[109](index=109&type=chunk) [Controls and Procedures](index=24&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal control over financial reporting identified - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2023[112](index=112&type=chunk) - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[113](index=113&type=chunk) [Part II. Other Information](index=25&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings and Risk Factors](index=25&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any material legal proceedings and reports no material changes to previously disclosed risk factors - The company is not currently involved in any material legal proceedings[116](index=116&type=chunk) - There have been no material changes from the risk factors previously disclosed in the company's 2023 Annual Report[117](index=117&type=chunk) [Share Repurchases and Other Disclosures](index=25&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common stock was repurchased during the quarter, with $26.8 million remaining available under the share repurchase program expiring in September 2023 | Share Repurchase Activity | Three Months Ended June 30, 2023 | | :--- | :--- | | Total Number of Shares Purchased | 0 | | Average Price Paid per Share | $0 | | Maximum Dollar Value Remaining (in thousands) | $26,815 |

Spectrum Holdings and Licensing - Anterix holds approximately 50% of the 900 MHz band spectrum in the United States, with nationwide coverage including Hawaii, Alaska, and Puerto Rico [14]. - As of March 31, 2023, Anterix was granted broadband licenses for 105 counties, up from 21 counties in 2022 [16]. - The company has negotiated and contracted approximately two-thirds of the transactions required to clear the licensed broadband segment channels [21]. - Anterix's strategy includes converting narrowband spectrum to broadband licenses and offering long-term leasing of broadband spectrum [17]. - The company aims to support digital transformations and infrastructure modernization for critical infrastructure industries [17]. - The company is actively working with federal and state agencies to promote the benefits of private broadband LTE networks for utilities [26]. - The company is focusing on expanding its customer base beyond electric utilities to include ports, railroads, water, oil and gas facilities, and mining operations [29]. - The company is facilitating the adoption of 900 MHz Band 8 radio access network equipment and end-user devices in the U.S. to support PLTE networks [28]. - The company has invested in business development and marketing teams to enhance customer relationships and grow its pipeline [34]. Agreements and Financials - The Ameren Agreements cover a service area of approximately 7.5 million people with a total scheduled prepayment of $47.7 million over 30 years [35]. - The Evergy Agreement, covering a population of approximately 3.9 million people, has a total prepayment of $30.2 million for a 20-year term [38]. - The Xcel Energy Agreement provides dedicated long-term usage of the 900 MHz Broadband Spectrum for a term of 20 years across eight states [40]. - The Xcel Energy Agreement includes total prepayments of $80.0 million, with $8.0 million received in December 2022, and remaining prepayments due by mid-2028 [41]. - The SDG&E Agreement involves a total payment of $50.0 million, with an initial payment of $20.0 million received in February 2021 and the remaining $30.0 million due through fiscal year 2024 [43]. - The LCRA Agreement has total payments of $30.0 million, due through fiscal year 2026, as the relevant cleared 900 MHz Broadband Spectrum is delivered [45]. - Revenue recognition for the Xcel Energy Agreement will occur over approximately 20 years as performance obligations are met, starting in Q2 FY24 [42]. - The company delivered 1.4 x 1.4 cleared 900 MHz Broadband Spectrum to SDG&E in September 2022, resulting in a milestone payment of $0.2 million [43]. Regulatory and Compliance - The FCC approved a Report and Order on May 13, 2020, to modernize the 900 MHz band, creating a 6 MHz broadband segment [51]. - The company entered into an agreement with the Association of American Railroads to cancel licenses in the 900 MHz band, enabling the AAR to relocate operations [57]. - The company is collaborating with incumbents to clear the 900 MHz Broadband Spectrum allocation in Xcel Energy service territories [41]. - The company satisfies the 50% Licensed Spectrum Test in approximately 3,200 out of 3,233 counties in the United States and its territories [59]. - The 90% Broadband Segment Test requires the company to control or have agreements covering 216 channels out of 240 in the broadband segment for licensing [60]. - The company must surrender 240 licensed channels to obtain a 6 MHz broadband license, with the option to make an Anti-Windfall Payment if insufficient channels are available [63]. Market and Competitive Landscape - The wireless communications industry is highly competitive, and the company is continuously monitoring changes to maximize the value of its spectrum assets [29]. - The average cost for channels in aggregate will be lower than the nationwide average of $0.93 per MHz of population covered (POP) from the FCC's 600 MHz auction [63]. - The company began acquiring additional channels in the 900 MHz band in 2015 in anticipation of regulatory changes [68]. - The company has been retuning channels with Covered Incumbents since 2015 to facilitate compliance with the 90% Broadband Segment Test [69]. Employee and Organizational Culture - As of March 31, 2023, the company had 82 full-time employees and engages consultants and contract workers as needed [78]. - The company conducted an Employee Engagement survey in 2021 with 80% participation, indicating a highly engaged workforce [80]. - As of March 31, 2023, 33% of the Board members and 28% of the workforce identify as diverse, with 31% of new hires being females and the overall workforce being 35% female [81]. - The company has implemented a hybrid work model requiring employees to work from the office three days a week, three weeks a month, balancing team development and personal benefits [82]. - The company is committed to fostering an inclusive culture through initiatives like Anterix GROW, which was launched in February 2023 [81]. - Employee sentiment is gauged through surveys, and the company is dedicated to addressing areas needing improvement [82]. - The company has established partnerships with organizations like INROADS and Talent Hue to enhance diverse talent recruitment [81]. - The company provides training and development opportunities, including leadership coaching and mentoring, to support employee growth [82]. Financial Risks and Economic Factors - The primary exposure to market risk is interest income sensitivity, with a 10% change in market interest rates not expected to materially impact financial condition or results of operations [162]. - Inflationary factors have led to increased operating expenses, and continued high inflation could adversely affect the company's business and financial condition [164]. - The company is not currently exposed to market risk from changes in foreign currency as all transactions are denominated in U.S. dollars [163]. - The company continues to monitor market risk exposure, including impacts from health pandemics and macroeconomic volatility [165].

Investor Presentation Safe Harbor Statement FORWARD-LOOKING STATEMENTS Certain statements contained in this presentation, other than historical information, constitute forward- Accordingly, you should not rely upon these forward-looking statements as a representation or warranty looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- by us or any other person that we will achieve our objectives and plans in any specified time frame, or looking statements inclu ...

Anterix, Inc. (NASDAQ:ATEX) Q3 2023 Earnings Conference Call February 14, 2023 8:30 AM ET Company Participants Natasha Vecchiarelli - IR Robert Schwartz - President, CEO & Director Ryan Gerbrandt - COO Christopher Guttman-McCabe - Chief Regulatory & Communications Officer Conference Call Participants James Ratcliffe - Evercore ISI Simon Flannery - Morgan Stanley George Sutton - Craig-Hallum Walter Piecyk - LightShed Partners Michael Crawford - B. Riley Securities Operator Good day, everyone, and welcome to ...

Financial Performance - Spectrum revenues for the three months ended December 31, 2022, were $578 million, compared to $385 million for the same period in 2021, representing a 50.1% increase[15] - The net loss for the three months ended December 31, 2022, was $8.0 million, compared to a net loss of $12.7 million for the same period in 2021, indicating a 37.5% improvement[15] - The net loss for the nine months ended December 31, 2022, was $31.859 million, compared to a net loss of $26.502 million for the same period in 2021, representing a 20.5% increase in losses[24] - The Company recognized total spectrum revenue of $1.311 million for the nine months ended December 31, 2022, compared to $749,000 for the same period in 2021, representing a 75.1% increase[42] - Interest income increased by $0.4 million, or 4444%, to $0.4 million for the three months ended December 31, 2022, and by $0.6 million, or 1118%, to $0.7 million for the nine months ended December 31, 2022, due to higher interest rates[105] Operating Expenses - Operating expenses for the three months ended December 31, 2022, totaled $14.8 million, up from $12.7 million in the same period of 2021, reflecting a 16.3% increase[15] - General and administrative expenses increased by $1.9 million, or 18%, to $12.1 million for the three months ended December 31, 2022, primarily due to higher stock compensation and headcount costs[97] - Non-cash compensation expense attributable to stock awards was $13.411 million for the nine months ended December 31, 2022, compared to $10.047 million for the same period in 2021, reflecting a 33.5% increase[24] - Product development expenses increased by $0.2 million, or 7%, to $3.0 million for the nine months ended December 31, 2022, driven by higher IT-related costs[99] - Sales and support expenses increased by $0.1 million, or 10%, to $1.4 million for the three months ended December 31, 2022, primarily due to higher headcount costs[98] Assets and Liabilities - Total current assets decreased to $72.5 million as of December 31, 2022, down from $115.8 million as of March 31, 2022, a decline of 37.3%[13] - Total liabilities increased to $98.6 million as of December 31, 2022, compared to $91.7 million as of March 31, 2022, an increase of 7.5%[13] - The accumulated deficit as of December 31, 2022, was $(353.9) million, up from $(313.8) million as of March 31, 2022, reflecting a worsening of 12.8%[13] - The balance of contract liabilities increased to $61.367 million as of December 31, 2022, from $54.678 million at March 31, 2022[46] - The balance of contract assets increased to $736,000 as of December 31, 2022, from $638,000 at March 31, 2022[44] Cash Flow and Financing - Cash flows from operating activities resulted in a net cash used of $18.676 million for the nine months ended December 31, 2022, compared to a net cash provided of $27.037 million for the same period in 2021[24] - The company reported a total cash and cash equivalents balance of $57.511 million at the end of the period, down from $127.764 million at the end of the previous year[24] - Net cash used in investing activities was $20.6 million for the nine months ended December 31, 2022, compared to $16.3 million for the same period in 2021, primarily for acquiring and retuning wireless licenses[116] - Net cash used in financing activities was $8.8 million for the nine months ended December 31, 2022, compared to $0.5 million for the same period in 2021, mainly due to stock repurchases[117] - The company may need to raise additional capital to implement business plans and initiatives, with potential financing through debt or equity offerings[110] Agreements and Contracts - The company plans to continue its efforts in commercializing spectrum assets to targeted utility and critical infrastructure customers[10] - The Xcel Energy Agreement provides for $80 million in scheduled prepayments over 20 years, with $8 million received in December 2022[27] - The Evergy Agreement resulted in a prepayment of $30.2 million for a 20-year term, covering service territories in Kansas and Missouri with a population of approximately 3.9 million[89] - The company has secured dedicated long-term usage of its 900 MHz Broadband Spectrum for Xcel Energy, enabling the deployment of a private LTE network[27] - The company has a contingent liability of $20.2 million related to the SDG&E Agreement for the sale of 900 MHz Broadband Spectrum, with $0.2 million received as a milestone payment during the quarter ended September 30, 2022[77][78] Market and Regulatory Risks - Future projections indicate potential challenges in achieving operating and financial guidance due to regulatory and competitive risks[10] - The company does not expect a material impact on financial condition from a 10% change in market interest rates due to the short-term nature of its financial instruments[125] - The company is currently not exposed to market risk from foreign currency fluctuations as all transactions are in U.S. dollars[126] - Inflationary factors have increased operating expenses, which may adversely affect revenues if not controlled[127] Internal Controls and Governance - Management concluded that disclosure controls and procedures were effective as of the end of the reporting period[128] - There were no changes in internal control over financial reporting that materially affected the company during the reporting period[129]

Financial Data and Key Metrics Changes - At the end of the quarter, the company had $86 million in cash and approximately $50 million in remaining contracted proceeds due to be paid in the next few years, indicating a strong financial position [9][10] - The capital-efficient model allows the vast majority of contracted proceeds to result in free cash flow, with multi-decade customer lease contracts providing significant future value [9] Business Line Data and Key Metrics Changes - The company is focused on becoming the de facto private broadband solution for utilities, with a strong emphasis on closing individual deals to capture the sector [7][10] - There are over 60 prospective customers in the pipeline, demonstrating growing demand for 900 megahertz private LTE [16] Market Data and Key Metrics Changes - The company is seeing increased interest from various sectors, including pipelines, gas companies, freight rail operators, and government installations, reflecting a broader demand for private broadband networks [17] - The public industry focus on private LTE is measurable, with over 50% of the nationwide spectrum value represented by participation from utility leaders and organizations [11] Company Strategy and Development Direction - The company aims to pioneer the transformation of utility sector communication capabilities and monetize its nationwide spectrum asset [18] - The strategic focus remains on the utility sector, with ongoing efforts to address critical challenges such as grid monetization and renewable energy integration [10][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to close significant contracts, highlighting the complexity and evolving nature of the deals [12][19] - The company remains optimistic about achieving its target of $1.8 billion in contracted proceeds around fiscal 2024, emphasizing long-term value opportunities [41] Other Important Information - The company has established an active ecosystem program with over 80 members, indicating strong collaboration within the industry [11][51] - Legislative support, including the recent Inflation Reduction Act, reinforces the importance of the issues the company is addressing for utilities [19] Q&A Session Summary Question: Update on the fourth contract under LOI - Management clarified that there is no direct correlation between the number of LOIs discussed previously and the current four deals, indicating progress in the pipeline [20][21] Question: Commentary on Phase III of the pipeline - Management noted that the pipeline includes both parent company and operating company opportunities, with significant potential for growth [27][28] Question: Progress on the four deals since the last call - Management indicated that progress is being made across all deals, with varying timelines for completion [31][33] Question: Status of the third LOI not included in the four deals - Management confirmed that all deals remain in the pipeline, with no losses to competition, and emphasized ongoing development across all phases [38][39] Question: Competitive landscape regarding private networks - Management acknowledged increased interest from competitors but emphasized the company's leading position in the private LTE movement and its substantial market footprint [42][44]