Core Insights - Intuitive Machines, Inc. (NASDAQ: LUNR) is recognized for its disruptive potential in the technology sector, particularly in the context of growth investing [1]. Group 1: Company Overview - Intuitive Machines, Inc. is positioned as a growth investment opportunity due to its innovative technologies [1]. Group 2: Analyst Background - Dilantha De Silva, an experienced equity analyst with over 10 years in the investment industry, focuses on small-cap stocks often overlooked by Wall Street [1]. - Dilantha is a CFA Level III candidate and has qualifications from the Chartered Institute for Securities and Investment (CISI) [1]. - His work has been featured on major financial platforms such as CNBC, Bloomberg, Nasdaq, and Yahoo Finance [1].

Core Insights - Intuitive Machines, Inc. has achieved Capability Maturity Model Integration (CMMI) Maturity Level 3 for its software development processes, indicating a commitment to excellence and alignment with NASA's Class A human spaceflight requirements [1][3] Company Overview - Intuitive Machines is a diversified space technology and infrastructure services company focused on disrupting lunar access economics. The company successfully soft-landed its Nova-C class lunar lander on the Moon in 2024, marking the return of the United States to the lunar surface for the first time since 1972. In 2025, the company returned to the lunar south pole with a second lander [4] - The company's offerings are structured around three pillars of space commercialization: Delivery Services, Data Transmission Services, and Infrastructure as a Service [4] CMMI Framework - CMMI is an industry-recognized framework that helps organizations improve performance and effectiveness. A CMMI appraisal at Maturity Level 3 signifies that Intuitive Machines' software development processes are well characterized, understood, and documented [3][5] - CMMI serves as a benchmark for measuring and improving software engineering process maturity, particularly at NASA Centers, to support NASA's software engineering requirements [3][6] Commitment to Quality - The CMMI Level 3 rating reflects the company's ongoing commitment to disciplined engineering practices and continuous improvement, linking internal software development processes to business objectives [4]

Group 1 - Michael Wiggins De Oliveira is an inflection investor, focusing on buying undervalued companies at pivotal moments when their business narratives are shifting towards increased profitability [1] - The investment strategy emphasizes technology and the Great Energy Transition, including uranium, with a concentrated portfolio of approximately 15 to 20 stocks and an average holding period of 18 months [1] - Michael has over 10 years of experience in analyzing companies, particularly in the tech and energy sectors, and has built a following of over 40,000 on Seeking Alpha [2] Group 2 - The Investing Group Deep Value Returns, led by Michael, offers insights through its concentrated portfolio of value stocks, timely updates on stock picks, and a weekly webinar for live advice [3] - The group provides "hand-holding" support for both new and experienced investors, fostering an active and vibrant community accessible via chat [3]

Core Insights - Intuitive Machines has successfully completed the acquisition of KinetX, enhancing its capabilities in deep space navigation and mission design [1][2][3] Acquisition Details - The acquisition was valued at $30 million, consisting of approximately $15 million in cash and around 1,400,000 shares of Intuitive Machines common stock [2] - KinetX has a strong track record supporting NASA and other space agencies, providing navigation services for missions to Mercury, Pluto, asteroids, and the Moon [2] Strategic Implications - The integration of KinetX's navigation technology with Intuitive Machines' data service platform aims to provide secure and reliable communications for lunar and interplanetary missions [1][3] - The acquisition is expected to position Intuitive Machines as a leader in cislunar space and support future Mars telecommunications programs [3][5] Company Background - Intuitive Machines is focused on disrupting lunar access economics and has successfully landed its Nova-C class lunar lander on the Moon in 2024, marking a return to lunar exploration for the U.S. [6] - The company operates through three main pillars: Delivery Services, Data Transmission Services, and Infrastructure as a Service [6]

Industry Overview - The second half of 2025 has seen a significant increase in robotics adoption across various industries, with global industrial robot installations exceeding $16.5 billion and a 10% increase in operational robots to over 4.28 million [2] - Manufacturing is leading this transformation, with North American robot orders up 4.3% and revenues rising 7.5%, totaling 17,635 robots valued at $1.094 billion in the first half of 2025 [3] - Healthcare robotics is projected to grow from a market size of $4.31 billion in 2024 to $9.60 billion by 2033, with a CAGR of 9.26% from 2025 to 2033 [4] - The collaborative robot market is expected to grow from $1.42 billion in 2025 to $3.38 billion by 2030, driven by AI integration [6] - Investment activity in robotics has reached historic levels, with over $6 billion raised globally from January to July 2025 [7] Company Highlights - UiPath is positioned as a compelling investment opportunity with the launch of its UiPath Platform for agentic automation, addressing a $50 billion market for autonomous business process automation [10][11] - Cadence Design Systems made a strategic €2.7 billion acquisition of Hexagon's Design & Engineering business, enhancing its capabilities in robotics and physical AI simulation [12] - NVIDIA has launched significant advancements, including the Isaac GR00T N1.5 humanoid robot foundation model and Jetson Thor, which provides 2,070 FP4 teraflops of AI compute power [13] - Advanced Micro Devices is optimizing digital twin and simulation workloads for next-generation robotics applications through a collaboration with Parallel Domain, enhancing realism and scalability [14]

Group 1 - GE Aerospace is identified as a high growth mega cap stock suitable for long-term investment over the next three years [1] - A tentative five-year agreement has been signed between the United Auto Workers and GE Aerospace, covering employees at the Evendale, Ohio, and Erlanger, Kentucky facilities [1][3] - The agreement includes provisions for job security, bonus vacation days, and healthcare expenses, with GE Aerospace committing to cover almost all premium increases during the contract term [2] Group 2 - The contract also establishes minimum staffing levels and introduces new work opportunities at both sites [2] - The tentative agreement follows a call for a strike by 600 workers advocating for stronger protections and benefits, with a ratification vote scheduled for September 19 [3] - GE Aerospace, a subsidiary of General Electric Company, specializes in commercial and defense aircraft engines, mechanical aircraft systems, and engine components [4]

Core Insights - Intuitive Machines, Inc. (NASDAQ: LUNR) is experiencing a complex phase in its history, with second quarter results indicating lower-than-expected revenues [1] Financial Performance - The second quarter results revealed that revenues fell short of expectations, prompting a detailed analysis of the financial metrics [1]

Core Viewpoint - Intuitive Machines, Inc. has announced the pricing of $300 million in 2.500% convertible senior notes due 2030, increasing from a previously announced size of $250 million, with an option for initial purchasers to buy an additional $45 million [1][2] Use of Proceeds - The net proceeds from the Notes Offering are estimated to be approximately $291.8 million, or $335.5 million if the additional notes option is fully exercised, intended for capped call transactions and general corporate purposes including operations, research and development, and potential acquisitions [2] Additional Details of the Notes - The Notes will be senior, unsecured obligations with an annual interest rate of 2.500%, maturing on October 1, 2030, and interest payable semiannually starting April 1, 2026 [3] Conversion Rights - Noteholders can convert their Notes under specific conditions before July 1, 2030, and at any time thereafter, with an initial conversion rate of 76.2631 shares per $1,000 principal amount, representing a conversion price of approximately $13.1125 per share, a 25% premium over the last reported price of $10.49 [4] Redemption and Repurchase Rights - The Notes are not redeemable before October 6, 2028, and can be redeemed by the company under certain conditions. Noteholders can require the company to repurchase their Notes upon a "fundamental change" at 100% of the principal amount plus accrued interest [5][6][7] Capped Call Transactions - Intuitive Machines has entered into capped call transactions to reduce potential dilution upon conversion of the Notes, with an initial cap price of $20.9800 per share, a 100% premium over the last reported sale price [8] Market Activity Impact - The option counterparties may engage in derivative transactions and purchase shares of Intuitive Machines' stock, which could influence the market price of the stock and the Notes [9][10] Company Overview - Intuitive Machines is focused on space technology and services, having successfully soft-landed lunar landers in 2024 and 2025, and aims to disrupt lunar access economics through its offerings in Delivery Services, Data Transmission Services, and Infrastructure as a Service [13]

Core Viewpoint - Intuitive Machines, Inc. plans to offer $250 million in convertible senior notes due 2030, with an option for an additional $37.5 million, to qualified institutional buyers, aiming to support its operations and potential acquisitions [1][3]. Group 1: Notes Offering Details - The convertible senior notes will be senior, unsecured obligations, accruing interest at an annual rate, payable semiannually starting April 1, 2026, and maturing on October 1, 2030 [2]. - The notes will be convertible into cash, shares of Class A common stock, or a combination thereof, with specific terms to be determined at pricing [2]. Group 2: Use of Proceeds - A portion of the net proceeds from the notes offering will be used for capped call transactions, while the remaining funds will support general corporate purposes, including operations, research and development, and potential acquisitions [3]. - If the option for additional notes is exercised, proceeds will similarly be allocated for capped call transactions and general corporate purposes [3]. Group 3: Capped Call Transactions - Intuitive Machines expects to enter into capped call transactions to reduce potential dilution of its Class A common stock upon conversion of the notes [4]. - These transactions are designed to offset cash payments required in excess of the principal amount of converted notes, subject to a cap [4]. Group 4: Market Impact - The initial purchasers of the notes may engage in derivative transactions or purchase shares of Class A common stock, which could influence the market price of the stock and the notes [5][6]. - Such activities may affect the conversion process and the number of shares received by noteholders upon conversion [6]. Group 5: Company Overview - Intuitive Machines is a diversified space technology company focused on lunar access economics, having successfully landed its Nova-C class lunar lander on the Moon in 2024 and returned in 2025 [10]. - The company operates through three pillars: Delivery Services, Data Transmission Services, and Infrastructure as a Service [10].

[Part I – Financial Information](index=6&type=section&id=Part%20I%20%E2%80%93%20Financial%20Information) [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) Presents Intuitive Machines' unaudited condensed consolidated financial statements for Q2 and H1 2025, including balance sheets, income statements, and cash flows [Condensed Consolidated Balance Sheets](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$475.6 million** while liabilities decreased to **$184.7 million**, improving the shareholders' deficit Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $344,901 | $207,607 | | Total current assets | $396,753 | $293,161 | | Total assets | $475,639 | $355,404 | | **Liabilities & Equity** | | | | Total current liabilities | $107,295 | $98,831 | | Earn-out liabilities | $0 | $134,156 | | Total liabilities | $184,746 | $351,483 | | Total shareholders' deficit | $(379,123) | $(1,008,034) | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 revenue grew to **$50.3 million**, but a net loss of **$(38.2) million** was reported, while H1 net loss narrowed to **$(37.2) million** Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $50,313 | $41,641 | $112,837 | $114,860 | | Operating loss | $(28,640) | $(27,500) | $(38,717) | $(30,275) | | Net income (loss) | $(38,206) | $16,655 | $(37,231) | $(101,376) | | Net income (loss) per share - basic | $(0.22) | $0.34 | $(0.33) | $(1.73) | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow turned positive at **$0.2 million**, and financing activities provided **$151.3 million**, significantly boosting cash Six Months Ended June 30, Cash Flow Summary (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $156 | $(37,702) | | Net cash used in investing activities | $(14,176) | $(3,793) | | Net cash provided by financing activities | $151,314 | $70,608 | | **Net increase in cash** | **$137,294** | **$29,113** | [Notes to Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations of accounting policies, financial results, and significant subsequent events including an acquisition and facility expansions - The company operates as a space technology, infrastructure, and services company focused on establishing cislunar infrastructure through three core pillars: delivery services, data transmission services, and infrastructure as a service[40](index=40&type=chunk) - One major customer, NASA, accounted for **85%** and **81%** of total revenue for the three and six months ended June 30, 2025, respectively[57](index=57&type=chunk) - All **10,000,000** Earn Out Units related to the 2023 Business Combination have vested as of June 30, 2025, eliminating the corresponding earn-out liability from the balance sheet[60](index=60&type=chunk)[61](index=61&type=chunk) - Subsequent to the quarter end, on August 6, 2025, the company entered into an agreement to acquire KinetX, Inc. for an aggregate base consideration of **$30.0 million** in cash and stock[169](index=169&type=chunk) - In July 2025, the company amended its ground lease to expand its Lunar Production and Operations Center (LPOC) with an additional investment of at least **$12.0 million**[170](index=170&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, business model, strategic developments, results of operations, key metrics, and liquidity [Overview](index=36&type=section&id=Overview) The company leads cislunar infrastructure development with successful IM-1 and IM-2 lunar missions as key achievements - The company's IM-1 Nova-C lander became the first U.S. vehicle to softly land on the lunar surface since 1972[176](index=176&type=chunk) - The IM-2 mission landed at the southernmost location of the moon, 5 degrees from the south pole, in March 2025[176](index=176&type=chunk) [Results of Operations](index=43&type=section&id=Results%20of%20Operations) Q2 2025 revenue increased to **$50.3 million**, but operating loss widened, and net loss was **$(38.2) million**, while H1 net loss narrowed Results of Operations Comparison (in thousands) | Metric | Q2 2025 | Q2 2024 | Change | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | $50,313 | $41,641 | $8,672 | $112,837 | $114,860 | $(2,023) | | Cost of revenue | $62,156 | $57,692 | $4,464 | $118,003 | $116,891 | $1,112 | | Operating loss | $(28,640) | $(27,500) | $(1,140) | $(38,717) | $(30,275) | $(8,442) | | Net income (loss) | $(38,206) | $16,655 | $(54,861) | $(37,231) | $(101,376) | $64,145 | - The Q2 2025 revenue increase was driven by CLPS missions (+$11.7M), the NSN contract (+$9.5M), and the LTV contract (+$3.9M), partially offset by a decrease in the OMES III contract (-$19.5M) due to project cancellations[227](index=227&type=chunk) [Key Business Metrics and Non-GAAP Financial Measures](index=46&type=section&id=Key%20Business%20Metrics%20and%20Non-GAAP%20Financial%20Measures) Backlog decreased to **$256.9 million**, Adjusted EBITDA remained a loss, and free cash flow improved to an outflow of **$(14.0) million** Backlog (in thousands) | Date | Backlog | | :--- | :--- | | June 30, 2025 | $256,909 | | December 31, 2024 | $328,345 | - The decrease in backlog was primarily due to performance on existing contracts (**$112.8 million**) and mission close-out adjustments (**$8.4 million**), partially offset by **$49.8 million** in new awards[244](index=244&type=chunk) Reconciliation of Net Income (Loss) to Adjusted EBITDA (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $(38,206) | $16,655 | $(37,231) | $(101,376) | | Adjustments | $12,838 | $(3,108) | $12,123 | $77,833 | | **Adjusted EBITDA** | **$(25,368)** | **$13,547** | **$(25,108)** | **$(23,543)** | [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with **$344.9 million** in cash, bolstered by **$151.3 million** from financing activities - Cash and cash equivalents were **$344.9 million** and working capital was **$289.5 million** as of June 30, 2025[254](index=254&type=chunk) - Net cash provided by financing activities was **$151.3 million** for H1 2025, mainly from **$176.6 million** in proceeds from warrant exercises, offset by a **$20.7 million** share repurchase[261](index=261&type=chunk) - The company has a **$40.0 million** secured revolving credit facility with Stifel Bank, which remained unborrowed as of June 30, 2025[255](index=255&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Intuitive Machines is exempt from providing market risk disclosures - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[279](index=279&type=chunk) [Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[280](index=280&type=chunk) - No material changes to internal control over financial reporting occurred during the three months ended June 30, 2025[281](index=281&type=chunk) [Part II – Other Information](index=52&type=section&id=Part%20II%20%E2%80%93%20Other%20Information) [Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ongoing legal proceedings, including a breach of contract lawsuit regarding Series A Preferred Stock conversion - The company is defending a breach of contract lawsuit filed by Starlight Strategies IV LLC related to the conversion of Series A Preferred Stock[144](index=144&type=chunk)[282](index=282&type=chunk) [Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors, but the company will lose its "emerging growth company" and "smaller reporting company" status, increasing compliance costs - The company will no longer qualify as an "emerging growth company" or a "smaller reporting company" as of December 31, 2025[284](index=284&type=chunk) - Losing this status will result in increased compliance requirements, such as auditor attestation of internal controls under Sarbanes-Oxley Section 404(b), and is expected to increase legal and accounting costs[287](index=287&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=52&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds were reported during the period - None reported[285](index=285&type=chunk) [Other Information](index=53&type=section&id=Item%205.%20Other%20Information) No other information is reported for this item - None reported[288](index=288&type=chunk) [Exhibits](index=54&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with the Quarterly Report, including CEO and CFO certifications and Inline XBRL data files