Intuitive Machines, a leader in space exploration technology, has announced a significant increase in its financial performance for the second quarter of 2024. The company’s revenue reached $41.4 million, more than double the revenue from the same quarter in the previous year. This surge has propelled the company’s revenue for the first half of the year to $114.5 million, exceeding its total revenue for the entire year of 2023. In response to these strong results, Intuitive Machines has raised its full-year revenue forecast to a range of $210 million to $240 million. The company’s progress in lunar missions, including advancements in lander assembly and testing, as well as securing commercial rideshare delivery services, have contributed to its robust financial position. Intuitive Machines is also exploring the commercialization of NASA’s VIPER rover system and is awaiting a response from NASA on this matter.
Key takeaways from the earnings report include:
– Intuitive Machines’ Q2 revenue soared to $41.4 million, with first-half revenues surpassing the total for 2023.
– The company raised its full-year revenue outlook to $210 million – $240 million.
– Nearly $70 million in new backlog was booked, with a current contracted backlog of $213 million.
– Progress has been made on assembly and testing of the lander for the second mission.
– Commercial rideshare delivery services have been secured for the third mission.
– The company is interested in commercializing NASA’s VIPER rover system.
– CEO Steve Altemus discussed contract modifications and future mission timelines.
The company’s outlook includes:
– Full-year revenue forecast increased from $200 million to a range of $210 million to $240 million.
– Anticipated growth in backlog throughout the year with key program awards.
– Awaiting award decisions that could further bolster the company’s financials.
There were no significant misses reported in the earnings call, and bullish highlights include strong revenue growth, securing new backlog, and completing necessary investments for the Lunar Production & Operations Center. The company is making progress on various contracts with NASA, including the IM-2 and IM-3 missions, and is exploring opportunities in the rideshare business. Intuitive Machines’ financial performance positions it favorably in the space exploration industry, with a forward-looking approach that sets it apart. Investors following the company may also find insights from similar players in the industry, such as Lunar Resources (ticker: LUNR), which presents a contrasting picture in terms of financial health and market performance. The company’s forward-looking statements, as described in our earnings press release and SEC filings, may differ from actual results due to various factors. We do not commit to updating these statements. Additionally, we may discuss non-GAAP financial measures, with reconciliations provided in our Form 8-K filing. An earnings call presentation is available on our website for further insights into our operational and financial performance. Moving forward, our achievements in delivery services, data transmission, and autonomous operations in space mark significant milestones. Revenue for the first half of the year exceeded that of 2023, with a strong outlook for the rest of the year. We have secured substantial new backlog and are on track to meet our revenue targets. Progress on our second and third missions, including successful engine qualification and site selection, demonstrates our capabilities in lunar exploration. The completion of the system requirements review for our Lunar Terrain Vehicle Services program validates our designs and expertise in lunar surface operations. We are also exploring opportunities to commercialize the NASA VIPER rover system, leveraging our capabilities and experience in lunar exploration. The evolving landscape of space exploration, highlighted by advancements in Chinese lunar missions, underscores the importance of data transmission and stable funding for our services in the space industry. The Near Space Network Services (NSNS) contract, similar to the satellites supporting China’s far-side sample-return mission, is crucial for providing comprehensive data services for navigating, prospecting, and communicating around the moon. Intuitive Machines is well-positioned to secure and deliver orbiting lunar data satellites to support autonomously operated infrastructure on and around the moon. By offering key services for a robust lunar economy, Intuitive Machines aims to solidify its position as a pioneering space exploration company. With a focus on delivering high-quality services, data transmission, and autonomous operations, the company is poised to capitalize on the rapidly developing lunar economy. Financially, the company had a strong quarter, with revenues up 130% year-over-year, leading to an improved cash outlook and an increase in full-year revenue guidance. Despite a higher operating loss driven by mission completion and contract modifications, the company’s cash balance remains strong at $31.6 million. With launch provider payments settled and debt paid off, Intuitive Machines is well-positioned to fund operations for the next 12 months. Looking ahead, the company expects continued growth in backlog and revenue, with a raised full-year revenue guidance range of $210 million to $240 million. Overall, Intuitive Machines continues to demonstrate strong performance and anticipates further growth opportunities in the space exploration sector. What is the timing of the response schedule? And what are the implications if VIPER is unable to continue in terms of moving forward with the critical information it was going to gather?
Steve Altemus: Good morning, Suji. Thank you for the question. VIPER faced budget challenges on NASA’s side, leading to the cancellation of the program. However, Intuitive Machines is exploring commercial or international interest in continuing the mission. With our heavy cargo class lander, Nova-D, we have the capability to carry VIPER’s payload to the lunar surface, along with additional payload space that can be monetized to offset costs. We are working with a coalition of commercial companies, international partners, and universities to propose a solution to NASA via an RFI. The data collected by VIPER is crucial for lunar science and the Artemis program, particularly in prospecting for volatiles and water ice. We believe that VIPER’s science is essential for future lunar missions and understanding how astronauts can live and work on the moon.
Suji DeSilva: Thank you, Steve. Moving on to the lunar communications network, what are the next milestones to watch for in this endeavor?
Steve Altemus: We have established the ground network using radio astronomy dishes for direct communication between Earth and the moon. We are constructing a communication satellite for data relay, with plans to deploy it in Mission three. The major milestone this year is the Near Space Network Services contract, for which we are in the competitive range. We expect the awards for both the direct to earth and data relay contracts in August and September, which will kick off our initial operational capability in space.
Suji DeSilva: Regarding finances, are the facility costs in place, or are there more CapEx requirements in the next 12 months?
Steven Vontur: We have completed the CapEx investment for our Lunar Production & Operations Center, financed by the city of Houston. Our lease costs come from working capital, and we do not anticipate any significant CapEx requirements going forward.
Suji DeSilva: Thank you, and congratulations on the progress.
Steven Vontur: Thank you, Suji.
Operator: Our next question is from Griffin Boss of B. Riley Securities. Griffin, go ahead with your question.
Griffin Boss: Good morning. Regarding the NSNS award and CP-22, the timeline for the awards seems to have been delayed. Can you provide any insight into the cause of this delay?
Steve Altemus: Procurement awards from the government can be unpredictable, leading to delays in expected timelines. We are currently anticipating the outcomes of the CP-22 and NSNS awards in August and September based on information provided by NASA.
Griffin Boss: And for VIPER, does Intuitive Machines need to invest in completing the rover, or will the costs primarily be for transporting the rover?
Steve Altemus: We are still determining the extent of NASA’s involvement in completing the rover. While NASA is progressing with thermal vacuum testing, operational costs for operating the instruments on the surface may require either NASA contribution or additional investment from us. I believe that the $84 million budget left to go is not a realistic number in terms of commercial operations. It seems to be a government figure, not a commercial one, so I don’t think it’s that significant. However, I would like to bring key members from the build and science teams on board to help us with surface operations.
In terms of milestone payments for IM-2, we are tracking to our ship date at the Cape, which is within our control. We aim to launch in December through the first quarter of January to avoid major delays. The launch window for IM-2 has been extended to early 2025, and we are focusing on launching during the December-January timeframe.
As for IM-3, we have finalized contract modifications with NASA to align with landing site selections and mission schedules. The financial impact will be booked in the new year to avoid affecting the 2024 financials. We are looking at launching IM-3 in the fourth quarter of 2025.
Regarding the OMES contract, we have worked with NASA to put the OSAM project back on schedule and within budget. As for margins, Steve can provide more information on that.
They reaffirmed their interest in flying the OSAM mission with a line item in the appropriations bill that provided necessary funds until 2025. This positive development gave us confidence in our revenue projections and allowed us to project high single-digit margins on that service contract. We are pleased with the progress and look forward to continued success.
Regarding potential DoD work, we have submitted proposals and signed contracts for rideshare payloads and other projects with the DoD. We are also working on the JETSON low power contract with AFRL. These efforts demonstrate our commitment to diversifying beyond NASA and expanding our business opportunities.
As for the VIPER rover and the NSNS contract, we are actively engaged with NASA and other partners to explore opportunities for these missions. We are awaiting feedback on our proposals and expect updates in the coming months. We are optimistic about the potential for these projects and look forward to further developments.
Overall, we are confident in our strategy and excited about the future growth opportunities in both the commercial and government sectors. We remain focused on delivering innovative solutions and expanding our capabilities to drive success in the industry.
During our discussions with the government regarding CLINs Contract Line Items, we were asked to submit final proposals for each, which have been completed. It is evident that the program and contract are progressing in a positive direction. The government has informed us that awards will be made in August and September, regardless of potential external factors like the election or a continuing resolution.
Moving on to the lunar training program, SEOPS does not directly impact LTV as their focus is on payload delivery to non-traditional orbits. However, we see great potential for LTV commercially. NASA will operate the manned rover for seven months autonomously or with crew for scientific or operational purposes. The remaining five months will be dedicated to commercial activities, where we can support various endeavors on the moon. We have engaged with space agencies and commercial entities, building a market for LTV deployment in 2027-2028.
Thank you for your questions, and we appreciate your interest in our company’s progress. We look forward to upcoming award discussions and continued growth opportunities. Thank you for joining today’s call.