Release Date: August 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Revenue for the first half of the year was $114.5 million, surpassing all of 2023's revenue.
- Q2 revenues increased by 130% year-over-year, reaching $41.4 million.
- Intuitive Machines Inc (LUNR, Financial) has zero debt on its balance sheet and sufficient cash to fund expected operations for the next 12 months.
- The company booked nearly $70 million of new backlog so far this year, with several sizable opportunities still on the horizon.
- Intuitive Machines Inc (LUNR) raised the low end of its full-year 2024 revenue outlook from $200 million to $210 million, resulting in a new range of $210 million to $240 million.
Negative Points
- Operating loss for the quarter was $28.2 million, up from $13.2 million in the second quarter of 2023.
- Higher SG&A expenses due to increases in public company costs, employee compensation benefits, stock-based compensation, and rent on the new corporate headquarters.
- Free cash flow in the quarter was an outflow of $33.5 million, driven predominantly by $21.5 million of launch provider payments.
- The company faces schedule uncertainty for its next two missions, impacting revenue recognition and operational planning.
- Intuitive Machines Inc (LUNR) is still awaiting key contract awards, such as the NSNS and CP22, which introduces some uncertainty in future revenue projections.
Q & A Highlights
Q: Can you provide an update on the NASA Viper Rover program and its potential impact on Intuitive Machines?
A: NASA canceled the Viper Rover program due to budget challenges but is open to commercial or international interest. Intuitive Machines has proposed flying the Viper Rover on its heavy cargo class lander, Nova D, which can carry 1,500 kilograms of payload. This mission could provide critical data for the Artemis program and lunar scientists.
Q: What are the next milestones for building the lunar communications network?
A: Intuitive Machines has constructed a ground network and is developing a communications satellite for its third mission. The major milestone this year is the Near Space Network Services (NSNS) contract award, expected in August and September. This contract will kickstart the initial operational capability for lunar data relay satellites.
Q: Are there any additional capital expenditures required for facilities in the next 12 months?
A: The capital expenditures for the new Houston Spaceport facility are essentially complete. The facility was financed by the city of Houston, and Intuitive Machines pays a long-term lease. No significant CapEx is expected going forward.
Q: What is causing the delay in the NSNS and CP22 contract awards?
A: Delays in government procurement processes are common. Intuitive Machines expects the NSNS contract awards in August and September, and the CP22 award in August, based on the latest information from NASA.
Q: Will Intuitive Machines need to invest in the Viper Rover to complete it?
A: The extent of investment required depends on how far NASA takes the Rover. Some operational costs may need to be covered, but the $84 million budget mentioned by NASA is not reflective of commercial costs. Intuitive Machines plans to involve select members from the build and science teams for operations.
Q: When can we expect milestone payments for the IM2 mission?
A: The launch window for IM2 has been extended to early 2025. Intuitive Machines is managing to a ship date to the Cape, with the launch expected in the December to January timeframe. Financial impacts for 2024 are not expected to be significant.
Q: What are the important milestones for the IM2 mission this year, and what is the timeline for the IM3 mission?
A: Contract modifications with NASA have aligned IM2 and IM3 schedules with landing site selections and payload delivery dates. IM2 is planned for the end of the year into Q1 2025, and IM3 for Q4 2025. Financial impacts for 2024 are conservatively planned.
Q: How is the OCM project progressing, and what margins should we expect?
A: The OCM project has been restructured for success, with NASA reaffirming its interest. The project is back on schedule and budget, with high single-digit margins expected for the year.
Q: What is the potential for Department of Defense (DoD) work, and how is Intuitive Machines diversifying beyond NASA?
A: Intuitive Machines has submitted several proposals to the DoD and signed contracts for rideshare payloads and other projects. The company is also executing on the Jetson low-power nuclear satellite contract with AFRL.
Q: What are the timing expectations for the NSNS contract award?
A: NASA has indicated that the NSNS contract awards will occur in August for the data relay satellite and in September for the direct-to-Earth communications. The CP22 award is expected in August.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
