Momentus (MNTS) - 2023 Q4 - Annual Report

Financial Performance and Funding - Momentus has incurred significant losses since its inception and expects to continue incurring losses in the future, raising concerns about achieving or maintaining profitability [18]. - The company requires substantial additional funding to finance its operations, but adequate financing may not be available when needed or on acceptable terms [18]. - Momentus had cash and cash equivalents of $2.1 million as of December 31, 2023, primarily invested in highly liquid investments [402]. - Momentus' term loan indebtedness bears interest at a fixed rate, insulating it from interest rate changes [403]. Market Opportunities and Growth - The total addressable market for in-space transportation is estimated at approximately $2 billion annually, projected to double to $4 billion by 2025, including $2-2.5 billion for onboard satellite propulsion and $1.5-2 billion for "space tugs" [50]. - The broader space economy is valued at $546 billion in 2023, with an expected growth to over $1 trillion by 2040, indicating a significant market opportunity for Momentus [49]. - The demand for small satellites and satellite buses is anticipated to grow, driven by advancements in technology and the increasing number of satellite constellations [44][45]. - Momentus aims to capture emerging markets in the space economy by providing new service offerings and utilizing various marketing approaches [87]. Services and Technology Development - Momentus plans to provide a range of services including last mile satellite transportation, on-orbit refueling, and debris removal, which are expected to lower operating costs for satellite operators [34]. - The company is developing its Tape Spring Solar Array (TASSA), which aims to produce power at significantly lower costs than competing arrays and offers advantages in deployment and maneuverability [33]. - Momentus aims to offer a range of in-orbit services, including inspection, refueling, and maintenance, as the number of satellites in space increases [45][51]. - The company plans to transition its OSVs from expendable to reusable, which could significantly lower service delivery costs [37][59]. - Momentus's transportation service is expected to provide cost-effective options for customers compared to traditional ride-share and dedicated small launch vehicles [48]. - The company has developed a patent-pending water plasma propulsion technology and holds eight issued patents with applications for six additional patent families as of December 31, 2023 [86]. Operational Challenges and Risks - Momentus has a history of delivering customer satellites using its service vehicles since 2022, but setbacks during missions could adversely affect its business and reputation [18]. - The company is subject to stringent U.S. export and import control laws, and failure to comply could have a material adverse effect on its business [20]. - Momentus operates in a highly competitive industry, which may necessitate price reductions to maintain market share [18]. - The market for in-space infrastructure services is not well established, and growth may be slower than anticipated [20]. - The company relies on third-party launch vehicles for deploying its satellites, and any delays could negatively impact its financial condition [20]. - Momentus has a limited operating history, making it difficult to evaluate its future prospects and the risks it may encounter [20]. Mission Accomplishments and Developments - Momentus conducted three test and demonstration missions of its Vigoride OSV in 2022 and 2023, with the vehicle designed to transport up to 750 kg of customer payloads in low-earth orbit (LEO) [56][57]. - Momentus launched its first orbital service vehicle, Vigoride 3, on May 25, 2022, deploying a total of 8 customer satellites during its inaugural mission [66][70]. - The Vigoride 5 mission, launched on January 3, 2023, successfully completed primary mission objectives, including the deployment of a cubesat and a complex hosted payload, with over 300 thruster firings totaling 6 hours and 58 minutes [74]. - During the Vigoride 6 mission on April 14, 2023, Momentus deployed all customer payloads, including CubeSats for NASA's LLITED mission, although one deployment experienced a mapping error [75][76]. - Momentus has conducted four missions to date, deploying a total of 17 customer satellites and providing hosted payload services [80]. - The Vigoride 6 mission included a demonstration of the Tape Spring Solar Array (TASSA), which showed significant performance capabilities during its test [77][78]. Regulatory and Compliance Matters - Momentus has received FCC licenses for its missions, including Vigoride 5 and Vigoride 6, and is actively pursuing compliance with evolving regulatory requirements [89]. - Momentus engaged with the FAA for ongoing payload reviews to address national security concerns raised during interagency reviews [97]. - The FAA denied a payload review application in May 2021 due to concerns regarding Momentus' corporate structure at that time [91]. - The company completed the final divestiture payment related to the National Security Agreement in March 2023 and requested termination of the NSA in December 2023, which was granted in January 2024 [100]. Infrastructure and Human Resources - The company leased a 65,000-square-foot facility in San Jose, California, to support Vigoride assembly and testing, allowing for increased production volumes [102]. - Momentus is focused on optimizing human capital resources and actively recruiting talent with experience in defense and aerospace sectors [101]. - Momentus has established relationships with multiple launch providers, including SpaceX, to maximize flexibility and service resiliency for its customers [81][84].