Q2 Total Revenue Increases 29% Over Prior Year Period
Company Wins $40 Million in New Contracts and Renewal Agreements
First 35cm Very High Resolution Gen-3 Satellite Planned for Launch in Q4
HERNDON, Va. — (BUSINESS WIRE) — August 8, 2024 — BlackSky Technology Inc. (“BlackSky” or the “Company”) (NYSE: BKSY) announced results for the second quarter ended June 30, 2024.
Second Quarter Financial Highlights:
- Revenue of $24.9 million, up 29% from the prior year quarter
- Imagery & software analytical services revenue grew 14% over the prior year quarter
- Imagery & software analytical services cost of sales(1), as a percent of revenue, improved to 20% from 23% in the prior year quarter
“BlackSky delivered another strong quarter driven by a 29% year-over-year increase in second quarter revenue and substantial operating leverage which led to improved margin performance,” said Brian E. O’Toole, BlackSky CEO. “We won $40 million in new awards and extension agreements, including the continuation of subscription services under the EOCL contract. Our Gen-3 constellation remains on track to unlock our next phase of growth by enabling transformative solutions our customers are demanding, using the power of our very high resolution imagery, combined with high-frequency monitoring and automated AI.”
Recent Highlights
- The National Reconnaissance Office extended its subscription to our Gen-2 high-frequency imagery services under the Electro-Optical Commercial Layer (EOCL) contract
- Won a $7 million contract renewal with an international government customer to provide dynamic space-based imagery and analytics monitoring services
- Continued to win task orders under the multi-year contract with the U.S. Air Force Research Laboratory to develop and demonstrate AI-enabled space-based moving target detection, tracking and identification
- Awarded multiple six-figure subscription contracts in support of various international government agencies
- In the final phases of assembly, integration, and testing on our Gen-3 satellites and have begun mission planning preparation for launch and commissioning operations
- Finalizing launch window for first Gen-3 satellite with Rocket Lab
(1) Cost of sales is defined as imagery and software analytical services costs and professional and engineering services cost, less depreciation and amortization expense. |
Financial Results
Revenues
Total revenue for the second quarter of 2024 was $24.9 million, up $5.6 million, or 29%, from the second quarter of 2023. Imagery and software analytical services revenue was $17.5 million in the second quarter of 2024, up 14% over the prior year period, primarily driven by incremental customer orders for BlackSky’s imagery services. Professional and engineering services revenue was $7.5 million in the second quarter of 2024, up 87% over the prior year period. The significant year-over-year increase was primarily related to the execution step up of multiple major international contracts. Professional and engineering services contracts are milestone-based contracts that may have quarter-over-quarter revenue variability, in contrast to the imagery and software analytical services, which are typically recurring subscription-based revenues.
Cost of Sales(1)
Total cost of sales as a percentage of revenue improved to 28% for the second quarter of 2024, compared to 44% in the second quarter of 2023. Imagery and software analytical service costs as a percentage of revenue improved to 20% in the second quarter of 2024, compared to 23% in the second quarter of 2023, primarily driven by greater volumes of revenue that inherently have a low fixed-cost structure as a percentage of revenue.
Operating Expenses
Operating expenses for the second quarter of 2024 were $29.8 million, which included $2.2 million of non-cash stock-based compensation expense and $11.3 million in depreciation and amortization expenses. Operating expenses for the second quarter of 2023 were $30.7 million, which included $2.1 million in non-cash stock-based compensation expense and $11.8 million in depreciation and amortization expenses. Excluding the non-cash stock-based compensation and depreciation and amortization expenses from both years, cash operating expenses(2) for the second quarter of 2024 were $16.3 million, compared to cash operating expenses of $16.8 million for the second quarter of 2023. The year-over-year decrease of $0.5 million, or 3%, was primarily driven
by reductions in general corporate costs, which more than offset investments in our go-to-market initiatives.
(1) Cost of sales is defined as imagery and software analytical services costs and professional and engineering services cost, less depreciation and amortization expense. |
(2) Non-GAAP financial measure. See “Non-GAAP Financial Measures” below and reconciliation table at the end of this press release. |
Net Loss
Net loss for the second quarter of 2024 was $9.4 million, compared to a net loss of $33.4 million in the second quarter of 2023.
Adjusted EBITDA(2)
Adjusted EBITDA for the second quarter of 2024 was $2.1 million, compared to an Adjusted EBITDA loss of $5.8 million in the second quarter of 2023. The $7.9 million year-over-year improvement was primarily driven by strong operating leverage achieved through higher revenues, improvement in gross margins, and reductions in cash operating expenses.
Balance Sheet & Capital Expenditures
As of June 30, 2024, cash and cash equivalents, restricted cash, and short-term investments totaled $42.3 million. In addition, the Company anticipates receiving approximately $28.2 million in payments over the next 12 months as interim milestones on a few major customer contracts are met and expected to be billed, further enhancing the Company’s liquidity. Capital expenditures for the second quarter of 2024 were $12.9 million.
2024 Outlook
The Company maintains its outlook for full year 2024 revenue of between $102 million and $118 million, and full year 2024 Adjusted EBITDA of between $8 million and $16 million. In addition, the Company maintains its expectations for full year 2024 capital expenditures of between $55 million and $65 million, primarily driven by investments in our Gen-3 satellites.
Investment Community Conference Call
BlackSky will host a conference call and webcast for the investment community this morning at 8:30 a.m. EDT. Senior management will review the second quarter results, discuss BlackSky’s business, and answer questions. To access the live webcast or the archived webcast following completion of the call, please visit the Company’s investor relations website at http://ir.blacksky.com and then select “News & Events” for the link to the webcast. A presentation accompanying the webcast can also be found on the investor relations website. To access the conference call, participants should dial 1-800-715-9871 or 1-646-307-1963 using conference ID 5380118 or “BlackSky” at least ten minutes prior to the start of the call. To listen to a replay of the conference call, please dial 1-877-660-6853 or 1-201-612-7415 using access code 13748009. The audio replay will be available from approximately 12:30 p.m. EDT on August 8, 2024, through August 22, 2024.
(2) Non-GAAP financial measure. See “Non-GAAP Financial Measures” below and reconciliation table at the end of this press release. |
