MNTS

Good afternoon, thank you for standing by. My name is Jane and I will be your conference operator today. At this time I would like to welcome everyone to the Momentus Inc. Third Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. As a reminder, today's call is being recorded. I would like now to turn the call over to Mary Horn of Investor Relations. You may begin your conference.

Thank you and hello, everyone. Welcome to Momentous' third quarter 2023 earnings conference call. With me here today are John Rue, Chief Executive Officer of the company and Chairman of its Board of Directors, as well as Eric Williams, Chief Financial Officer. Each will provide prepared remarks. Following these prepared remarks, we will take questions from analysts. Earlier today, we issued a press release and made a slide presentation available on our Investor Relations website, which provides an overview of our business and financial highlights for the quarter. You can download a copy of the release and presentation slides at investors.momentous.space. During today's call, we will make certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. You should listen to today's call with the understanding that our actual results may be materially different from the plans, intentions, and expectations disclosed in the forward-looking statements we make. For more information about factors that may cause actual results to materially differ from forward-looking statements, please refer to the earnings press release we issued today, as well as the company's filings with the Securities and Exchange Commission. Readers are cautioned not to put undue reliance on forward-looking statements, and the company specifically disclaims any obligation to update the forward-looking statements that may be discussed during this call. Please also note that we will refer to certain non-GAAP financial information on today's call. You can find reconciliation of the non-GAAP financial measures to the most comparable GAAP measures in our earnings press release. None of these non-GAAP financial measures is a substitute for or superior to measures of financial performance prepared in accordance with GAAP. With that, I'd like to turn the call over to our Chairman and Chief Executive Officer, John Rood.

Thank you, Mary. It's a pleasure to be here today to provide an update on the progress we have made at Momentus over the past quarter and share our Q3 financial results. After I make my comments, our CFO, Eric Williams, will take you through the financial highlights and outlook. In the third quarter, Momentus made further advances towards our goal of being a market leader for satellite buses and in-space transportation and support services for U.S. government and commercial customers. Our launch heritage places us at the forefront of this expanding market and we believe we possess key competitive advantages with our differentiated orbital service vehicle and satellite bus. First, we've seen growing demand from both new and repeat commercial customers, as shown by the six new contracts we signed since mid-August. In addition, we continue to see opportunities in the U.S. government sector at defense and intelligence agencies, and in October, we submitted a bid to the U.S. Space Force Space Development Agency, or SDA, in response to its request for proposals for the Tranche 2 Tracking Layer program that involves producing 18 satellites to perform missile tracking and fire control. Second, since our last earnings call, the Company has raised additional capital and reduced operating expenses with the aim of extending our runway. Momentus has raised approximately $16.9 million in gross proceeds since our last earnings call. We have also taken steps to reduce our cash burn rate with a significant reduction from Q2-Q3 and a reduction in operating expenses of over 50% year-over-year from Q3 2022 to Q3 2023. That said, we continue to face the headwinds of navigating a shortening cash runway. In addition to working to raise additional capital, Momentus is also pursuing and evaluating strategic alternatives. As part of the evaluation of strategic alternatives, Momentus has received multiple indications of interest from potential strategic partners. Over the past several weeks, the company has been engaged in discussions with more than half a dozen potential strategic partners pursuant to confidentiality agreements. Management discussions with interested parties are ongoing. The company continues to position itself in order to quickly capitalize on any potential opportunities with interested parties and evaluate all viable strategic options. It's important to note that any capital raised by the company, that it's important to note that if any capital raised by the company is insufficient to provide a bridge to full commercial production at a profit, the company's operations could be curtailed or ceased. Our CFO, Eric Williams, will provide additional information on the company's finances in a few minutes. Third, we continue to operate two of our Vigoride orbital service vehicles in orbit, successfully demonstrating our core technology and gaining valuable flight heritage that we believe is a competitive advantage. Fourth, we continue to lean into significant markets where we believe Momentus has clear advantages. For example, we recently announced our M-1000 Satellite Bus offering. The M-1000 Satellite Bus is based on our successful and flight-proven Vigoride orbital service vehicle and offers a low-cost, flexible, and capable bus for government and commercial customers. We're seeing solid interest in our satellite bus and are working toward expanding our footprint within this large and mature market. And finally, we are driving new innovation to maximize our competitive advantage, including testing of our microwave electro-thermal thruster engine, continuing demonstration and testing of our Tape Spring Solar Array, and preparing to conduct a demonstration of Rendezvous and Proximity Operations early next year. We've already demonstrated our existing technology in space, including our pioneering and environmentally friendly thruster that uses water as its propellant. And we have executed well to meet our customer commitments. Since our first launch in May of 2022, Momentus has deployed 18 customer satellites using our Vigoride Orbital Service Vehicle and deployers. In addition, our hosted payload services enabled Caltech to conduct an innovative demonstration using cutting edge space technology to meet our needs on Earth by successfully collecting solar power in space and beaming it to Earth. Our Vigoride 5 mission launched in January of 2023 is ongoing and the spacecraft continues to be operational, support customer activities and demonstrate new capabilities. As a reminder, during the Vigoride 5 mission, Momentus deployed a customer satellite from Cosmosis and has provided hosted payload services to Caltech's Space Solar Power Demonstrator mission in accordance with our contract over the past six months. These types of hosted payload missions are more profitable than transportation missions, particularly for larger hosted payloads and longer duration missions. Also during this mission, the Momentus team conducted testing of the Microwave Electrothermal Thruster or MET in space where we successfully operated the propulsion system at full power across the range of firing durations of planned operation for its use cases, demonstrating capability to deliver satellites to precise custom orbits and to provide in-space infrastructure services like hosted payloads. The MET uses water as its propellant. Momentus is a pioneer in commercializing this technology with safe, easy to handle propellant that is environmentally friendly. Recently, we started using this same vehicle to advance MET testing and have achieved dual thruster firings. Dual thruster firings enable greater efficiency and quicker orbit transfer times. As of today, we have approximately 230 minutes of firing time on the MET between both thrusters. In total, we've executed approximately 6.5 kilometers in orbital raises of the Vigoride OSV or Orbital Service Vehicle by firing the MET in single or dual thruster firings. The MET technology has achieved firing times that are the operational times required for Momentus missions. Its non-toxic water propellant is intended to enable simpler, safer, and more cost-efficient operations preparing the spacecraft for launch on Earth and in operation in space. We're proud that the MET has shown its ability to operate as intended to perform these missions in space. And we look forward to using it to support commercial and U.S. government customers. Our mission with Vigoride 6 launched in April of 2023 is also ongoing. We have deployed all satellites for customers, including the REVELA payload for ARCA Dynamics, the VIREO CubeSat for C3S LLC, the DISCO-1 CubeSat for Aarhus University, the IRIS-C payload for an Asian customer booked through ISILAUNCH and two satellites for NASA. As a reminder, these successful commercial deployments culminated in Momentus recognizing revenue of $1.7 million in the second quarter of this year. We are proud of the performance of our Vigoride vehicle and see multiple use cases for it, particularly in support of more complex missions. We also have many customers whose mission requirements don't require the capabilities of a Vigoride vehicle in order to place them in orbit. In those cases, we will use another mechanism, like a deployer, to deliver our customers to their intended orbits. This approach serves the needs of our customers who don't require Delta-V or changes in velocity and position after release from the launch vehicle. For example, on our most recent mission, launched on the SpaceX Transporter-9 mission on November 11, we have deployed three satellites for customers using a deployer, including the Picacho satellite for Lunasonde, which is a U.S. sub-surface imaging company with the goal of making underground resources, like water and minerals, easier to find. The Picacho CubeSat is a technology demonstrator of Lunasonde’s sensors. It will measure the power spectral density of low frequency radio signals in the ionosphere, which will help inform designs for the company's future satellites. The Hello Test 1 & 2 satellites for Hello Space of Turkey are part of the Hello for IoT mission that that company is conducting. The two pocket cube satellites are part of Hello Space's broader mission to enable worldwide IoT ecosystems and end-to-end data services for various industries. Hello Test 1 and 2 are Hello Space's second and third satellites launched into orbit. There are two other satellites that Momentus carried on this flight that we cannot confirm deployment of at this time after their launch. We are coordinating with our customers as they work to establish communications with their satellites and with SpaceX to understand as well as possible the operation of the launch vehicle and our deployer system on that day. Moving into next year, we expect to fly our next Vigoride vehicle, Vigoride 7, on the SpaceX Transporter 10 mission targeted for launch no earlier than March of 2024. On this mission, Momentus has contracted to support seven customers that require orbital delivery services and two customers requiring hosted payload services for a total of nine customers that we will support on this mission. We also plan to carry a Momentus hosted payload that we will use to conduct a Rendezvous and Proximity Operations demonstration. With Vigoride 7, we are planning for a fuller payload, which would improve mission economics, and we anticipate that Vigoride 7 will generate more revenue than Vigoride 6. As I mentioned, we've expanded our product offerings to include low-cost, flexible, powerful satellite buses, spearheaded by our M-1000 satellite bus. We believe this new offering is well-positioned to serve a market valued at $11.9 billion in 2020 and is projected to reach $20.8 billion by 2030, according to Allied Market Research. The M-1000 satellite bus utilizes the same core technologies as our Vigoride, but will be tailored and enhanced as needed to meet the mission requirements of different customers across both the U.S. government, such as the Defense Department, and commercial customers. We believe our M-1000 bus can be manufactured at a rapid and scalable pace. It features high power, a flexible configuration to support individual customer needs, greater payload capacity than competing buses, and a quick production timeline to meet customer mission requirements rapidly at a low cost, making it highly competitive in the market. Since our last earnings call, we have signed six commercial contracts. One, we signed a contract with C3S for transportation and orbital delivery services in 2025. C3S is a repeat customer from Momentus. The C3S VIREO payload was transported to orbit on the Vigoride 6 mission launched in April of 2023. Secondly, we signed a contract with Arhaus University for transportation and orbital delivery services in late 2024. Arhaus is also a repeat customer. Momentus placed a satellite in low earth orbit for Arhaus, also on our Vigoride 6 mission that launched in April of this year. Third, we signed a contract with FOSSA Systems, a Spanish company that offers global, low power, internet of things, or IoT connectivity, and in-space services to provide hosted payload services starting in 2024. The contract also includes two options for additional hosted payloads. FOSSA is another repeat customer. Fourth, we signed a contract with RIDE! Space to transport two payloads to orbit, including the first satellite for the nation of Senegal and the second satellite for Djibouti. We signed a contract with SatRev to fly their SOWA-1 payload in the first quarter of next year and sixth, and most recently, we signed a contract with AVS to fly their LUR-1 payload in the second quarter of next year. We also continue to see interest and receive encouraging feedback from U.S. government customers. Earlier this year, we were awarded a Small Business Innovation Research contract from the U.S. Defense Department's Space Force Space Development Agency, or SDA. The first contract phase is worth roughly $746,000 and includes an option for a contract modification that we expect the SDA to exercise. This option would add an additional $1.2 million, bringing the total contract value to over $1.9 million. This project's scope involves making tailored modifications to the system underlying the M-1000 satellite bus and Vigorous Orbital Service Vehicle to support a range of Department of Defense payloads. Some of these areas include adding a secure payload interface, optical communications terminals, a high-volume data recorder, and improving the modularity of the propulsion system. We recently completed the first milestone under the first phase of this SDA contract. As mentioned earlier, we recently submitted a bid to the SDA for the Tranche 2 Tracking Layer Program, which involves building 18 satellites for tracking of ballistic and hypersonic missiles, as well as fire control, that we expect will exceed $700 million. We continue to receive favorable feedback and encouragement from the U.S. government about our capabilities, and have been pleased to host senior government officials for visits to our headquarters this past quarter. We intend to continue to compete. We're confident in our capabilities and solutions, and we understand it may take some time to grow into the defense industry leader we aim to be. We believe that demand for our services will increase as we see heightened government and Department of Defense interest. In addition, as we pivot towards expanding to the large and mature satellite bus market, and continue to pursue launch aggregation as a revenue stream, we are ensuring our launch schedule is optimized to meet this anticipated demand. We marked our third mission of the year just a few days ago with the SpaceX Transporter-9 launch. As I mentioned, we deployed three customer satellites, and are working to confirm the deployment of two additional satellites. We are excited to continue the momentum in 2024, and unlike many of our competitors, are already well positioned with SpaceX to continue customer deliveries. We have reserved ports on all of the SpaceX transporter missions through the end of 2024, including the Transporter 10 mission targeted for February of 2024, the Transporter 11 mission targeted for June of 2024, and the Transporter 12 mission targeted for October of 2024. The market opportunity for Momentus is substantial and experiencing strong growth. The Space Foundation's annual space report, which was released on July 25th, shows that in 2022, the global space economy grew 8%, reaching $546 billion. The commercial space market climbed nearly 8%, reaching over $427 billion. The U.S. government spent $69.9 billion on space programs, with the majority coming from the Department of Defense. Total space spending by the U.S. Department, classified and unclassified, for all military branches and intelligence agencies, is estimated to have grown to $42.9 billion in 2022, a 21% year-over-year increase. The flexibility, payload capacity, and power available on the Vigoride OSV and M-1000 satellite bus, make them well-positioned to support a range of national security missions, like space situational awareness, surveillance, reconnaissance, and other tasks. So it comes as no surprise that the U.S. government customers responsible for national security missions are demonstrating interest in these capabilities. Not only can our Vigoride OSV deliver national security payloads to custom orbits, to support unique mission requirements, but we're also able to move from initial customer requirements to operation in space with rapid speed, setting Momentous apart from traditional companies that support Department of Defense missions. Other factors, such as our ability to support power-intensive, high-end national security payloads, like sensors, communications equipment, and other electronics, and change orbital altitude and inclination, also distinguish Momentus from our competitors. Our capabilities make us well-suited to support the kind of manoeuvre in space that senior U.S. officials, like Space Force Chief of Space Operations, General Saltzman, have discussed as a critical need in the highly contested space environment. In addition, our highly experienced team of professionals and engineers with decades of national security experience gives us an edge over other U.S. companies and international competitors who cannot meet the needs of these large Defense Department customers and the international competitors who cannot meet the needs of these large Defense Department customers. Momentus seeks to grow in the space market and we believe our value proposition and differentiated capabilities support that goal. We've now delivered 18 satellites to orbit in our history while demonstrating the operational capabilities of our technology along with its functionality in space. We are also continuing to develop new differentiated technology and are expanding our product offerings to the large mature satellite bus market and to the expanding space servicing and de-orbit markets. In terms of improving our vehicles we're working to develop additional features and capabilities for Vigoride and the M-1000 satellite bus to enhance their performance such as high speed mission data links, adding expansion tanks, incorporating security features, and adding a precision pointing option to host sensitive and classified U.S. government payloads. We expect to begin introducing some of these features in 2024. A great example of our innovation is our Tape Spring Solar Array or T-A-S-S-A which has been in space since April on our Vigoride 6 mission. The TASSA utilizes flexible solar cell technology allowing the solar array to be extended and retracted like a tape measure using its concave shape to produce rigidity. TASSA is designed to be deployed and retracted on orbit numerous times, is configurable to varying lengths based on power requirements, and utilizes thin film solar cells that are radiation resistant and self-annealing. To date, in space testing was able to demonstrate the majority of the major performance requirements. Testing performed included boom yoke deployment, initial rollout deployment, thin film flexible solar cell basic power generation, low cost slip ring performance, and the retraction mechanism. This provides confidence as well as identifying areas for improvement as Momentus continues development of this technology. Once TASSA is fully flight qualified, Momentus estimates that replacing Vigoride's current solar array with TASSA will substantially reduce the overall recurring production cost of this spacecraft. Momentus was recently notified that our application was approved to issue the company a patent for technology behind TASSA. In addition, we're building out the capabilities we'll need to conduct more complex missions in the future. Our Rendezvous and Proximity Operations, or RPO technology demonstration, is planned for the Vigoride 7 mission, which is scheduled to be launched on the SpaceX Transporter 10 mission in February of 2024. RPO capability would expand the menu of services that Vigoride can provide to include in-orbit inspection, maintenance, and refueling of customer satellites, as well as life extension and orbiting of satellites at the end of their useful life. The RPO demo will allow us to perform space domain awareness and inspection services right away. The RPO mission also supports another innovation focus of ours, which is to evolve towards a reusable version of Vigoride, or refuelable version, that would stay in space and be refueled and therefore reused on later missions. Currently, after completing its mission, Vigoride will move to a lower degrading orbit and safely and responsibly burn up during re-entry. A reusable Vigoride, after completing its mission, would instead Rendezvous with and provide services to additional customer satellites, thereby providing greater return on investment for each Vigoride launch. In summary, let me just say that Momentus continues to make progress. One, advancing our differentiated technology with demonstrated competitive advantages and gaining flight heritage. Secondly, by signing additional commercial contracts. Third, by gaining greater interest from U.S. government and Defense Department organizations. Fourth, positioning the business for greater growth in the large and growing satellite bus market and emerging market for in-space logistics and satellite servicing, refueling, and de-orbit. And fifth, raising capital, reducing expenses, and pursuing strategic options. We are actively seeking new investors while considering the full range of strategic options. And we are continuing to drive our technology forward in concert with the demand signal that we are getting from key customers. Now I'll turn things over to our CFO, Eric Williams, to provide an update.

Thank you, John, for the introduction. I'm pleased to present highlights of the financial results achieved by the Momentus team during our third quarter of 2023. We ended Q3 2023 with unrestricted cash and cash equivalents of $9.8 million with approximately $5.7 million and outstanding gross debt consisting of a term loan that we began to repay in March of 2022. Similar to our Q2 earnings released earlier this year, our 10-Q will include language evaluating whether there are conditions and events that raise substantial doubt about our ability to continue as a going concern. This going concern determination was concluded as we prepared our financial statements for the third quarter after management conducted a comprehensive evaluation of the status of our current liquidity and projected cash flows for the next 12 months. When taking into account certain external factors, this analysis concluded that given our current cash balance, the company is unable to meet its obligations for the next 12 months. Although the company has a history of successfully raising cash primarily through the issuance of equity, consistent with relevant technical guidance, any projected or anticipated equity financing transactions are not generally viewed as probable for the purposes of going concern assessments. Momentus has taken and continues to take several proactive steps with respect to managing our burn rate and extending our crash runway while we continue exploring new business opportunities and working to raise additional capital. Towards the end of Q2 2023, we reduced our headcount consisting of both full-time employees and contractors by approximately 30% to substantially reduce our burn rate while retaining the talent we need to execute on our key near-term initiatives. We invested approximately $12.8 million in operating activities during Q3 as detailed in our 10-Q statement of cash flows, sequentially down $1.8 million as compared to $14.6 million in Q2 2023 and down $12.8 million or 50% lower as compared to $25.6 million in Q3 of 2022. In addition, the company has been working to raise additional capital while pursuing and evaluating strategic alternatives. During the quarter on September 11th, we successfully executed a registered direct offering raising $5 million in gross proceeds. In addition, since the end of this last fiscal quarter, we raised an additional $4 million in gross proceeds via a registered direct offering on October 4th, $1.35 million on October 17th from the exercise of existing warrants previously issued by the company, and $6.5 million gross proceeds via a warrant inducement agreement which closed on November 9th for a total of $11.9 million in gross proceeds since the end of the quarter. In total, the company raised approximately $16.9 million in gross proceeds since our last earnings call. As John mentioned in his prepared remarks, Momentus is also pursuing and evaluating strategic alternatives. As a result of this effort, Momentus has received multiple indications of interest from potential strategic partners. Over the past several months, the company has been engaged in discussions with more than half a dozen potential strategic partners pursuant to confidentiality agreements. Management discussions with interested parties are ongoing. While there can be no certainty that any transaction will ensue from the evaluation, the company continues to position itself in order to quickly capitalize on any potential opportunities with interested parties and evaluate all viable strategic options. In addition, if the capital raised by the company is insufficient to provide a bridge to full commercial production at a profit, the company's operations could be curtailed or ceased. As I'm sure you can appreciate, we are unable to comment further on any of these discussions at this time. We recognized $0.34 million in revenue in Q3 2023, consisting primarily of revenue generated from meeting a variety of customer service milestones associated with our Vigoride 5 launch. This was a 162% increase year-over-year from Q3 of 2022. We had $15.3 million in operating expenses during Q3, which was a 30% year-over-year improvement from the third quarter in the year prior. In the quarter, we generated approximately $15.1 million in losses from operations, an improvement of 31% compared to $21.6 million in losses from operations in Q3 of 2022. On a non-GAAP basis, our adjusted EBITDA was negative $10.6 million for Q3 of 2023, a sequential improvement of approximately $4.1 million from Q2 of 2023, and $5.5 million better as compared to Q3 of 2022. Non-GAAP SG&A expenses for the third quarter of 2023 totaled $5.6 million, an improvement of $1.1 million as compared to Q3 of 2022. Non-GAAP R&D expenses for the third quarter of 2023 total approximately $5.5 million, down $4 million from Q2 of 2023. We currently have approximately 6.6 million shares outstanding. In addition, during the quarter we completed a reverse split of our stock, which has allowed us to continue to meet the NASDAQ listing requirements while also aiding in future capital raising. With respect to backlog, we have decided to work towards providing more near-term metrics as our business grows. We found backlog to be more useful during the early stages of the company, and given the long-term nature of the contracts, find the metric to be less helpful going forward. We will continue assessing the benefits of providing forward-looking financial metrics while continuing to announce commercial opportunities as they arise. Please refer to the press release issued today for the reconciliation of Non-GAAP numbers to GAAP. I will now hand the call back to Mary.

Thank you, Eric. In a moment, we will move on to the question-and-answer portion of our call. I would like to remind participants that all disclaimers outlined at the outset of this call extend to the question-and-answer session. This includes our disclaimers relating to non-GAAP financial information, forward-looking statements, and the technology underlying our planned service. Operator, would you please remind participants how to enter the queue?

[Operator Instructions] Your first question comes from the line of Michael Mathison with Singular Research. Your line is open.

Congratulations on all the progress, you guys.

Thank you, Michael.

Looking forward, we talked last quarter about how when the SDA invited you to bid on Tranche 2 that that's potentially transformational for the company. Do you have a sense of when the SDA will choose the winners from that bid?

Thank you for the question, Michael. In July, Momentus submitted a bid, as you recall, with a group of other partner companies in response to SDA's request for proposals for a program called Tranche 2 Transport Layer Alpha. Unfortunately, the SDA recently announced the selections for contract award, and the contract was awarded to York Space and Northrop Grumman. So, Momentus was not selected for that contract. In that proposal, Momentus and our teammates submitted for the Tranche 2 Transport Layer Alpha competition. I would say that was a significant step forward for our company. Proposals for major U.S. Defense Department programs like this are a major undertaking. They are hundreds of pages long with detailed technical analyses and designs required. It takes time, in my experience, for bidders to become established with government agencies and to learn the nuances of their processes and the requirements that they use, as well as, importantly, the nuances that the bid evaluators use at an individual agency. While we were not selected, and Northrop Grumman and York Space were awarded contracts, certainly that was disappointing that we were not selected, but I would note there were a number of other companies who were not selected as well, such as Lockheed Martin and Terran Orbital. I guess, Michael, the best way I would explain is to use a baseball analogy. It is very common that companies need some at-bats, if you will, before getting a hit. We learned a lot during the Alpha competition, and we are already implementing lessons learned. Also, I would say we are figuratively back in the batter's box. We are taking another swing at another large SDA program. We think we have an even stronger set of teammates who have previously won SDA contracts. As I mentioned in my earlier remarks, Momentus and the industry partners that we have pulled together for this competition submitted a proposal for the Tranche 2 tracking layer program, which involves producing 18 satellites for missile tracking and fire control. We are optimistic about our prospects here. Certainly this is a process and it's a journey, if you will, and we're improving with every proposal we submit. And again, we do feel like we're better positioned for a contract award under the Tranche 2 tracking layer competition than we were under the Alpha competition. And the reasons, again, are we've developed a greater familiarity with the SDA government evaluators and how they work in a more nuanced way. We've also attracted this very strong set of teammates to partner with us on the bid. So we'll stay engaged in that process and the projected award from SDA for the tracking layer bid is mid-January.

Okay, great. Thank you for all that information. Looking ahead a little bit to some of your ongoing technology R&D, something that's pretty attractive is the idea of a reusable Vigoride. I know you can't be precise, but do you have any sort of ballparks about how much of a reduction in your cost of service a reusable technology would provide?

Well, thank you for the question again, Michael. Thus far, of course, Momentus has used an expendable version of the Vigoride orbital service vehicle. This reusable or refuelable version, of course, would stay in space after completing its initial mission where it delivered satellites or hosted payloads. And then on the subsequent mission, Momentus would launch replenishment fuel and other customer payloads that the orbital service vehicle would Rendezvous with and use its robotic arm to integrate. A reusable Vigoride, we estimate, could be reused six or seven times. Therefore, the unit economics would be a major improvement over the expendable version. There is some work that we need to do still to fully develop that reusable version. On our next mission of Vigoride, scheduled for March of 2024, we plan to take a big step towards this capability when we do the Rendezvous and Proximity Operations demonstration. In that demo, what Vigoride will do is it will attempt to release a target satellite, and then we will manoeuvre within two meters of that satellite. This will enable us to test the software, the sensors, the algorithms, and other technology necessary for this kind of mission and for servicing and refueling of other satellites or deorbiting satellites at the end of their useful life. We also then later will add a robotic arm in the future to enable the reusable version of Vigoride to do the mission. And there’s a little bit of shielding of electronics that we would need to do to allow for longer radiation exposure. Essentially, we would enclose some of our current electronics inside some shielding. So thanks again for the question, Michael.

Okay, great, well, and thank you for the information.

Our next question comes from [Indiscernible] with Deutsche Bank.

Hi, well thank you for taking my question. My first question will be about your M-1000 progress. Could you give more color on that? And also, will you need to flex [Ph] further flight heritage with it to gain more credibility?

Well, thank you for the question. The M-1000 bus, again, is based on our Vigoride orbital service vehicle, and there is a very high degree of commonality between the two vehicles, which allows us to leverage the flight heritage of the Vigoride as we market the M-1000 bus. I would say we're very encouraged by the positive reaction we're getting to the M-1000 rollout. We have both commercial and government customers who are showing interest in the M-1000. For instance, over the past 30 days, we've met with numerous customers about it. We received an RFI, or request for information, from a constellation provider that we're in the process of responding to. We feel the M-1000 is a differentiated product because it has higher relative power, a flexible configuration, the ability to carry a larger payload, and we're able to produce them at a low cost. Potential customers are telling us the M-1000 has a very good value proposition, and that's why they're reacting positively to it. Of note, the M-1000 was used in our bid to the Space Development Agency for the Tranche 2 tracking layer of 18 satellites that will be used for missile tracking. So we're very optimistic about the progress of the M-1000 and eager to leverage the flight heritage of our big ride Orbital Service Vehicle as we market it. Thanks again for the question.

Well, thank you so much for the information. And my second question will be, well, I see you signed several contracts quite recently and it seems quite faster than before. And the question will be, what do you think that is helping with that? Also, I think you already talked a little bit about this, but under this market condition competition, what do you think about your future growth?

As I, thank you for the question. As I mentioned on the call, Momentus has now deployed 18 satellites to date. The progress that we've made on those earlier missions and the flight heritage we've gained has positioned us better in the market than at the start of the company because customers are sensitive to whether you have flight heritage. They want to evaluate the risk of flying with you in the future. And for example, on our next mission, we plan to launch the Vigoride 7 Orbital Service Vehicle with seven customer payloads or satellites that require orbital delivery and two other customers for a total of nine. These other two customers are for hosted payload support. And of course, we plan to do our own hosted payload demonstration, hosted payload operation with a demonstration of Rendezvous and Proximity Operations on that flight. But we've also signed other contracts with customers to deliver their satellites to orbit that will fly on later missions like the SpaceX Transporter-11 and 12 missions, which are targeted for June and October of 2024. And we're actively booking customers and marketing for flights in 2024 and beyond. So we do see a growth in interest in our capability. You mentioned the six customer contracts that we've signed since August. So we're going to try to keep that momentum going. And that's the exhortation we've been giving to our sales team. So we're optimistic about the possibilities for future growth.

Okay, thank you for the information. Yes, that's really helpful.

There are no further questions at this time. This concludes today's conference call. You may now disconnect.

Good afternoon, ladies and gentlemen and welcome to the Momentus Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode, and please be advised that this call is being recorded. After the speaker's prepared remarks, there will be a question-and-answer session. [Operator instructions] And at this time, I would like to turn the call over to Maria Horne, Investor Relations for Momentous. Please go ahead, Maria.

Thank you and hello, everyone. Welcome to Momentous' second quarter 2023 earnings conference call. With me here today are John Rood, Chief Executive Officer of the company and Chairman of its Board of Directors, as well as Eric Williams, Chief Financial Officer. Each will provide prepared remarks. Following these prepared remarks, we will take questions from analysts. Earlier today, we issued a press release and made a slide presentation available on our Investor Relations website, which provides an overview of our business and financial highlights for the quarter. You can download a copy of the release and presentation slides at investors.momentus.space. During today's call, we will make certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this communication. You should listen to today's call with the understanding that our actual results may be materially different from the plans, intentions and expectations disclosed in the forward-looking statements we make. For more information about factors that may cause actual results to materially differ from forward-looking statements, please refer to the earnings press release we issued today, as well as the company's filings with the Securities and Exchange Commission. Readers are cautioned not to put undue reliance on forward-looking statements, and the company specifically disclaims any obligation to update the forward-looking statements that may be discussed during this call. Please also note that we will refer to certain non-GAAP financial information on today's call. You can find reconciliation of the non-GAAP financial measures to the most comparable GAAP measures in our earnings press release. None of these non-GAAP financial measures is a substitute for or superior to measures of financial performance prepared in accordance with GAAP. With that, I'd like to turn the call over to our Chairman and Chief Executive Officer, John Rood.

Thank you, Mary. It's a pleasure to be here today to provide an update on the progress we have made at Momentus over the past quarter and our Q2 financial results. After I make my comments, our CFO, Eric Williams, will take you through the financial highlights and outlook. In the second quarter, Momentus made solid progress toward our goal of being one of the market leaders in providing satellite buses and in-space transportation and support services for U.S. government and commercial customers. We are at the forefront of this expanding market and possess key competitive advantages. Notably, Q2 marks Momentus' first million-dollar revenue quarter with Q2 earnings finishing at $1.7 million for the quarter. In my remarks today, I'll discuss the progress we have made in our long-term strategy for growth and profitability. First, we continue to see growing interest from both government and commercial customers, which are expected to translate into contracts over the coming months, and I'm happy to have more details to share today on an important contract with the Space Development Agency. We have also signed a contract for a new hosted payload customer. I'll discuss these in further detail later. Second, we continue to operate two Vigoride orbital service vehicles, or OSVs, in low-Earth orbit, which are the second and third Vigoride that we launched in January 2023 and April 2023, respectively. On our three Vigoride missions conducted to date, we have successfully demonstrated our core technology, which is operational in space. With three spacecraft on orbit, we've accrued significant flight heritage with about a year of in-space flying time. Third, we're evolving our business strategy to lean into significant markets where Momentus has clear advantages. For example, we recently announced our M-1000 satellite bus offering. The M-1000 satellite bus is based on our successful Vigoride orbital service vehicle and builds on its flight heritage to offer a low-cost, flexible and capable bus for government and commercial customers. In fact, over the past quarter, we have submitted proposals to U.S. government customers like the Defense Department's Space Development Agency and to commercial companies to produce satellites using this bus. Fourth, we are driving new innovation to maximize our competitive edge and plan to demonstrate the functionality and operability of this technology in space over the coming months. Turning to Slide five, Momentus launched three orbital service vehicles in less than a year from May 2022 to April 2023. During these missions, we've deployed a total of 15 customer satellites and provided hosted payload services for a groundbreaking scientific mission from Caltech, a leading technical university. We've demonstrated our technology in space, including our pioneering and environmentally friendly thruster that uses water as its propellant and shown our ability to perform on our commitments for our customers. Turning to Slide six, our Vigoride 5 mission, which was launched in January 2023, is ongoing and the spacecraft remains in good health. During the Vigoride 5 mission, Momentus deployed a customer satellite from Cosmosis in Singapore into low Earth orbit and also carried a large hosted payload for Caltech. Since then, Momentus has been providing ongoing hosted payload services to Caltech's Space Solar Power Demonstrator, or SSPD mission, and Caltech reported that its payload recently demonstrated its ability to wirelessly transmit power in space and beam power to Earth. Momentus will continue to provide hosted payload support to the SSPD over the coming months as it continues its operations. Our contract calls for us to provide hosted payload support to the SSPD mission for at least six months and up to two years under a contract option. Hosted payload missions, like we are providing to Caltech, are more profitable than transportation missions, particularly for larger hosted payloads and longer duration missions. During the Vigoride 5 mission, the Momentus team conducted inaugural testing of the Microwave Electrothermal Thruster, or MET, used on the spacecraft that uses water as a propellant. This has included 35 firings of the thruster and a successful altitude raise of the Vigoride orbital service vehicle by more than three kilometers. On the Vigoride 5 mission, we operated the MET successfully in space at full power across the range of durations for firing that we plan to use operationally to deliver satellites to precise custom orbits and to provide in-space infrastructure services like hosted payloads. Momentus is a pioneer in bringing this efficient and environmentally friendly propulsion technology to market. We're proud that the MET has shown its ability to operate as intended to perform these missions in space, and we look forward to using it to support commercial and U.S. government customers. On Vigoride 6, which was launched in April 2023 and is ongoing, we have deployed all customer satellites, including the REVELA payload for ARCA Dynamics, the VIREO CubeSat for C3S LLC., the DISCO-1 CubeSat for Aarhus University, and the IRIS-C payload for an Asian customer booked through ISILAUNCH. The culmination of the Vigoride 6 commercial deployments contributed to Momentus recognizing revenue of $1.7 million in the second quarter. This is a significant milestone in our progress as a company and makes Q2 our first million-dollar quarter. During the Vigoride 6 mission, Momentus also deployed two CubeSats into low-Earth orbit as part of the NASA LLITED, L-L-I-T-E-D, or Low Latitude Ionosphere Thermosphere Enhancements and Density mission. These CubeSats housed behind a single deployer door were released from the Vigoride OSV earlier than scheduled. While the CubeSats were deployed at the intended altitude of 495 kilometers, they were deployed at a different inclination than the intended target orbit needed for the science experiment. NASA has confirmed the two CubeSats are functional and the team will be able to operate the science instruments aboard. Momentus conducted a thorough investigation and identified the root cause as human error in the mapping of a software command. The company has implemented corrective actions to prevent a recurrence. Vigoride 6 remains in good health and the team is working towards some of our mission milestones, like our solar array demonstration, which I'll speak about in more detail later in the presentation. We are proud of the performance of our Vigoride vehicle and see multiple use cases for it, particularly in support of more complex missions. We also have many customers whose mission requirements don't require the pedigree of a Vigoride. In those cases, we will use another mechanism, like a deployer, to deliver our customers to their intended orbits. This approach serves the needs of our customers who don't require Delta-V and further improves the economics of Vigoride. For example, our next mission is planned for launch on the SpaceX Transporter-9 mission targeted for no earlier than November 2023 to low Earth orbit. Rather than using a Vigoride OSV on this mission, we are carrying our customers on a deployer. The payloads we are flying on the November mission include a satellite from SatRev in Poland called the AMMAN1 Earth Observation Satellite. The satellite can be used for services such as land survey, precision health, agriculture, and data for weather, environmental and smart cities applications. The JINJUSat-1 satellite will be deployed for Contact Company of the Republic of Korea. Once in orbit, cameras mounted on the satellite will carry out a mission to take pictures of the Earth. The Picacho satellite will be deployed for Lunasonde - a U.S. sub-surface imaging company with the goal of making underground resources like water and minerals easier to find. The Picacho CubeSat is a technology demonstration of Lunasonde sensors. It will measure the power spectral density of low-frequency radio signals in the ionosphere, which will help inform designs for the company's future satellites. Moving into next year, we do aim to fly our next Vigoride vehicle on the SpaceX Transporter-10 mission targeted for launch no earlier than February 2024. On this mission, we will carry satellites that require orbital delivery services, as well as hosted payloads for commercial customers. We also plan to carry a Momentus hosted payload that we will use to conduct a rendezvous proximity operations demonstration. I am also pleased to see the operational progress that our talented engineering and operations team continues to make in increasing productivity, improving quality, and lowering unit costs. For example, Vigoride 6 assembly integration and test was 36% faster than Vigoride 5 with a 51% decline in non-conformances. With Vigoride 7, we plan for a fuller load of payloads and better mission economics, and we anticipate that Vigoride 7 will generate more revenue than Vigoride 6. Turning to slide 7, as I mentioned earlier, we've expanded our product offerings to include low-cost, flexible and powerful satellite buses. We are pleased to have recently announced our M-1000 satellite bus, which is well positioned for a large and growing market. For example, Allied Market Research reports that the global satellite bus market was valued at $11.9 billion in 2020 and is projected to reach $20.8 billion by 2030. The M-1000 satellite bus is based on our space-proven Vigoride OSV. Its core technologies are the same as Vigoride, and the newly branded M-1000 satellite bus is tailored and enhanced as needed to meet the mission requirements of different customers in both the U.S. government, such as the Defense Department, as well as for commercial customers. Our M-1000 bus has attributes that we expect to make it highly competitive in the market. It has high power, a flexible configuration to support individual customer needs, can carry more payload than competing buses, and can be produced to meet customer needs rapidly, all at low cost. Turning to slide 8, according to the Space Foundation, which released its Annual Space Report on July 25, the global space economy grew by 8% in 2022 to $546 billion. Of note, Space Foundation also estimates the total space spending by the U.S. Defense Department, both classified and unclassified spending for all military branches and intelligence agencies, grew to $42.9 billion in 2022, a 21% year-over-year increase. The M-1000 satellite bus is well-positioned for these growing, attractive markets and we're starting to see some traction. We were recently awarded a small business innovation research contract from the U.S. defense department's Space Development Agency, or SDA. And I'm pleased to share we have signed the contract for that work. The first contract action is worth roughly $746,000 and includes an option for a contract modification at a later date to add an additional $1,196,000 that we expect the SDA to exercise that will bring the total contract value to over $1.9 million. The scope of this project involves making tailored modifications to the system underlying the M-1000 satellite bus and Vigoride orbital service vehicle so that it's even better positioned to be used for SDA's future needs. Last month, we also submitted a bid to the SDA for the Tranche 2 Transport Layer Alpha program that involves building 50 satellites. These 50 satellites will be part of a global constellation of communications satellites supporting the needs of the U.S. Defense Department and military services. As a reference point, awards made by SDA for Tranche 1 of the transport layer satellites were about $700 million to Lockheed Martin, $692 million to Northrop Grumman, and $382 million to York Space Systems for a slightly smaller number of 42 satellites, which gives you a rough sense of the size of the contracts expected under Tranche 2. For our proposal for the Tranche 2 Transport Layer Alpha program, Momentus is the prime contractor on this effort, and we've pulled together a team of traditional and non-traditional defense contractors that we are confident can deliver for the SDA. We believe we are well-positioned for this project due to the differentiated capabilities, low cost and strong team we have put forward to the SDA. This proposal is now under evaluation by SDA, and we expect that agency to make contract awards in late September or early October to two teams to build 50 satellites each. We've also included our M-1000 bus as the featured product in other proposals that are undergoing reviews by both government and commercial customers. In addition to the M-1000, we're continuing to offer orbital delivery and hosted payload services. Momentus submitted a proposal to the Defense Innovation Unit, or DIU, for novel approaches to operationally responsive space. This project requires precise point-to-point delivery of cargo in a cost-effective manner at scale, a need for which our capabilities and technology are well-suited. Therefore, we are optimistic about our chances of winning this bid, as Momentus' value proposition lies right in the sweet spot. The DIU has indicated they will make a contract award within 60 days to 90 days, so we're currently awaiting notification. Momentus has signed a contract with FOSSA Systems to provide hosted payload services starting in 2024. Momentus provided orbital delivery services to FOSSA on the inaugural mission of Vigoride in 2022, and most recently provided mission management and integration support for the launch of the FOSSA FEROX-1 satellite in June 2023. We are pleased that FOSSA has selected Momentus again to support its growing needs and innovation that they are bringing to the market. They are a valued repeat customer. Commercial and government customers have shared very positive feedback about our capabilities and competitive pricing. This gives us confidence that we're well-positioned to succeed in this market. Turning to Slide nine, the anticipated demand for our services is only expected to increase, especially as we're seeing heightened government and DoD interest. In addition, as we pivot towards expanding to the large and mature satellite bus market and continue to pursue launch aggregation as a potential revenue stream, we are taking steps to ensure our launch schedule is optimized to meet this anticipated demand. Momentus differentiates itself by reserving space on SpaceX launch vehicles used for rideshare transportation missions that we then make available to customers. Other companies will take your reservation and then try to find a spot for your payload in a rapidly crowding launch vehicle manifest, introducing significant schedule risk to customers. We've already got space dedicated and we're ready to help customers make the most of it. First, we'll be flying on the SpaceX Transporter-9 mission, targeted for no earlier than November 2023 to low Earth orbit. Momentus has also reserved ports on all the SpaceX transporter missions through the end of 2024, including Transporter-10, targeted for February 2024, the Transporter-11 mission targeted for June 2024, and the Transporter-12 mission targeted for October of 2024. Turning to Slide 10, the market opportunity for Momentus is substantial and experiencing strong growth. For example, as I mentioned, the Space Foundation's Annual Space Report released last month shows that in 2022, the global space economy grew 8%, reaching $546 billion. The commercial space market climbed nearly 8%, reaching over $427 billion, and the U.S. government spent $69.9 billion on space programs, with the majority coming from the Department of Defense. We are pleased about the interest in our capabilities from U.S. government customers responsible for national security missions. The flexibility, payload capacity and power available in the Vigoride Orbital Service Vehicle and M-1000 satellite bus make them well positioned to support a range of national security missions, like space situational awareness, surveillance, reconnaissance and other missions. The Vigoride Orbital Service Vehicle can also deliver national security payloads to custom orbits to support their unique mission requirements. The speed with which we can move from initial customer requirements to operation in space is a major discriminator that sets us apart from traditional companies that support Defense Department missions. Having large amounts of power available to support intensive high-end national security payloads like sensors, communications equipment and other electronics also distinguishes Momentus from our competitors. Coupled with the ability to change orbital altitude and inclination, our capabilities are well-suited to support the kind of maneuver in space that senior U.S. officials like Space Force Chief of Staff General Saltzman have discussed as a key need in the high-tech contested space environment. In addition, Momentus has a highly experienced team of professionals and engineers with decades of national security experience that gives us an edge over other U.S. companies and also over international competitors who are unable to meet the needs of these large Defense Department customers. New regulations are also playing a role in expanding the opportunity for Momentus. For instance, last year, the FCC, or Federal Communications Commission, adopted a rule that will require satellite operators to remove their satellites from low-Earth orbit within five years following mission conclusion. With the number of satellite deployments growing rapidly, the problem of debris in space is accelerating rapidly. The rule from the FCC acknowledges the problem and we expect will create significant customer demand for satellite deorbiting services. NASA and the U.S. Defense Department have also been letting contracts for studies and demonstration missions for work on addressing the problem of growing orbital debris. Satellite deorbiting is a complex mission, but I'm proud to say that Momentus anticipated a more active stance on debris removal from regulators and has been investing in developing this capability for several years. We think our early investments and upcoming technology demonstrations provide us with a competitive advantage over others. If you consider that roughly 2,500 satellites were placed in orbit last year and that annual deployments are forecasted to roughly triple by 2028, according to Deutsche Bank, it's not hard to envision a scenario in which thousands of satellites need to be deorbited annually within the next decade, creating a multi-billion dollar addressable market. Turning to Slide 11, Momentus is well positioned to grow in the space market thanks to our value proposition with differentiated capabilities. We have now delivered 15 satellites to orbit in our history while demonstrating the maturity and operational capabilities of our technology along with its functionality in space. We are continuing to develop new differentiated technology and are expanding our product offerings to the large mature satellite bus market and to the expanding space servicing and deorbit markets. We're working to develop additional features and capabilities for our Vigoride and M-1000 bus performance, such as a high-speed mission data link, adding expansion tanks, incorporating security features, and adding a precision pointing option to host sensitive and classified U.S. government payloads. We expect to begin introducing some of these features in 2024. A great example of our innovation is our Tape Spring Solar Array or TASSA, T-A-S-S-A, which has been in space since April on our Vigoride 6 mission. We expect to soon unfurl and demonstrate this technology in the coming weeks. Our team, led by Chief Technology Officer, Rob Schwartz, has been working on the TASSA construct for several years as a potential means of reducing Vigoride unit manufacturing costs and lead times. The TASSA array is about 11 meters, or 36 feet long. To build TASSA, the team bonded large sheets of flexible solar cells to Tape Springs. Its concave shape provides its structural strength. It's very similar to the rollout tape measures you can buy from places like Home Depot. They keep their stiffness and strength due to their shape, only on a much larger scale. The four-inch mandrel is much smaller than those used in competing rollout solar arrays, providing weight savings. Once development is complete, we estimate that replacing Vigoride's third-party solar array with TASSA could reduce the overall recurring production cost of Vigoride by as much as 10%, while potentially reducing lead times by several months. We've applied to patent the technology behind TASSA, and we're seeing interest from commercial and government customers, given the efficiency we expect to demonstrate for low-cost power in space. Finally, our Rendezvous and Proximity Operations, or RPO technology demonstration, is planned for our Vigoride 7 mission, which is scheduled to be launched on the SpaceX Transporter 10 mission in February 2024. RPO capability is key to our ability to expand the menu of services that Vigoride can provide, to include in-orbit maintenance and refueling of customer satellites, life extension, and de-orbiting of satellites at the end of their useful life. The RPO mission also supports another innovation focus of ours, which is to evolve towards a reusable version of Vigoride, or a refuelable version that would stay in space and be refueled, and therefore reused on later missions. Currently, after completing its mission, Vigoride will move to a lower degrading orbit and safely and responsibly burn up during re-entry. A reusable Vigoride, after completing its mission, will rendezvous with and provide services to additional customer satellites, thereby providing greater return on investment for each Vigoride launched. Turning to Slide 12, in summary, Momentus is well-positioned for the future. We have a favorable demand outlook, demonstrated competitive advantages, attractiveness for growing U.S. government and Defense Department programs, and significant potential for margin improvement. In a moment, our CFO, Eric Williams, will walk us through the financials, but before he does that, I'll comment briefly on where we've come from and where we stand on our journey. It is clear that we've faced some headwinds in the recent risk-off environment in the market, and seen our stock price reflect that. Clearly, we would have liked for the market to have given greater value to the achievements that have put us in position to achieve substantial growth as we look forward. I would just conclude by commenting that it's worth stepping back and remembering what Momentus has achieved since becoming a public company just over two years ago. In August of 2021, our relationship with the Defense Department was not good, to put it charitably, and some in the market did not believe we would be able to repair it. That is most clearly not the case today, as indicated by our recent contract award from the Defense Department's Space Development Agency and its positive comments to us about our capabilities. In August of 2021, we had yet to test our microwave electro-thermal thruster on the Vigoride Orbital Service Vehicle in space, and some doubted we ever would. Today, we have tested it successfully in space on Vigoride, and not once or twice, but dozens of times in space, the ultimate test. In August of 2021, we hadn't begun to contemplate the ability to expand into the satellite bus market. Today, we have what is arguably the best value small sat bus available, based on comments by Defense Department officials to us, and we have recently submitted a major proposal to join the Defense Department's proliferated low-Earth orbit satellite constellation. In August of 2021, we had a young workforce. Today, this workforce, the foundation of our company's value, has matured to the point of having put three Vigoride Orbital Service Vehicles in space, deployed 15 customer satellites, and is, at this very moment, managing and controlling two of our Vigorides simultaneously in orbit. During our launch campaigns for the three Vigoride missions, when I'm here late at night and on weekends, I've been invigorated by walking around and seeing the passion of our employees hard at work despite the day or hour. I'm tremendously proud and could not be more appreciative of every single Momentus employee, and we're working hard to retain them. Momentus is pushing ahead on our growth path. We are competing vigorously in the defense, government and commercial markets. We have several promising near-term opportunities in our sweet spot. We are actively seeking new investors while considering the full range of strategic options, which is why we engaged Deutsche Bank recently, and we are continuing to drive our technology forward in concert with the demand signal we are getting from customers. With that, I'll turn the microphone over to our CFO, Eric Williamson.

Thank you, John, for the introduction. I am pleased to present highlights of the financial results achieved by the Momentus team during our second quarter of 2023. Turning to Slide 14, our second quarter results reflect our ongoing progress and investments towards our future launches. We have cumulatively signed contracts for approximately $32 million in backlog or potential revenue as of July 31, 2023. These contracts include firm orders as well as options. These options give our customers the flexibility to quickly opt into an available launch slot on short notice without requiring a separate agreement. The breadth of these signed contracts spans across 18 companies in 14 countries. Typically, our customers have the right to cancel a flight reservation, and when doing so, will forego their deposits and milestone payments. Should a customer cancel a contract for their rescheduling needs or other reasons before all of its payments are made, the resulting revenue will be less than the full value of the backlog. Momentus has historically included in backlog both firm orders as well as options. These options give our customers the flexibility to opt into an available launch slot without requiring a separate agreement. We ended Q2 2023 with unrestricted cash and cash equivalents of $21.3 million and approximately $9 million in outstanding gross debt, consisting of a term loan that we began to repay in March of 2022. Next, I would like to address a topic that will be mentioned in our 10-Q to be filed with the SEC. Our 10-Q will include language evaluating whether there are conditions and events that raise substantial doubt about our ability to continue as a going concern. This going concern determination was concluded as we prepared our financial statements for the second quarter after management conducted a comprehensive evaluation of the status of our current liquidity and projected cash flows for the next 12 months. When taking into account certain external factors, this analysis concluded that given our current cash balance, the company is unable to meet its obligations for the next 12 months. Although the company has a history of successfully raising cash primarily through the issuance of equity, consistent with the relevant technical guidance, any projected or anticipated equity financing transactions are not generally viewed as probable for the purposes of going concern assessment. Momentus has taken and continues to take several proactive steps with respect to managing our burn rate and extending our cash run rate while we continue exploring new business opportunities and working to raise additional capital. Towards the end of Q2 of 2023, we reduced our headcount consisting of both full-time employees and contractors by approximately 30% to substantially reduce our burn rate while retaining the talent we need to execute our key near-term initiative. We expect to realize the full impact of those cost reductions during Q3 of 2023. In addition, the company has been working to raise additional capital while pursuing and evaluating strategic alternatives. To that end, the company engaged Deutsche Bank as a financial advisor. We invested approximately $14.6 million in operations during Q2 compared to $18.7 million in Q1 2023 and $22.9 million in Q2 2022. We recognized $1.7 million in revenue in Q2 as a result of meeting a variety of customer service milestones associated with our Vigoride 5 and Vigoride 6 launches. In the quarter, we generated approximately $18.9 million in losses from operations compared to $23.2 million in losses from operations in Q2 of 2022. On a non-GAAP basis, our adjusted EBITDA was negative $14.4 million for Q2 2023, a sequential improvement of approximately $1.4 million from Q1 of 2023 and $3.8 million better as compared to Q2 of 2022. Non-GAAP SG&A expenses for the second quarter of 2023 totaled $6.4 million, an improvement of $1.8 million as compared to Q2 of 2022. Non-GAAP R&D expenses for the second quarter of 2023 totaled approximately $9.5 million, down $0.9 million from Q2 of 2022. We ended Q2 2023 with approximately 95 million shares outstanding. In addition, we have filed proxy materials that are scheduled to have a shareholders meeting on August 22 to approve a reverse split of our stock. We expect this to allow us to continue to meet the NASDAQ listing requirements and aid in future capital raising. Please refer to the press release issued today for the reconciliation of non-GAAP numbers to GAAP. I will now hand the call back to Maria.

Thank you, Eric. In a moment, we will move on to the question-and-answer portion of our call. I would like to remind participants that all disclaimers outlined at the outset of this call extend to the question-and-answer session. This includes our disclaimers relating to non-GAAP financial information, forward-looking statements, and the technology underlying our planned service offerings. Operator, would you please remind participants of the entry to the queue?

[Operator instructions] We will go first this afternoon to Michael Mathison at Singular Research.

Good afternoon, everyone. Congratulations on all that revenue.

Thank you, Michael. I appreciate it.

Just kind of looking into the dynamic of the going concern issue versus revenue versus the burn rate, I am sure that is an equation you sit there solving every afternoon. If I am sort of following it, it looks like you booked all the revenue that was available from the Vigoride 5 and Vigoride 6 missions having deployed all the satellites. It looks to me like the next revenue opportunity would be the November mission. Is that fair?

We have not totally finished recognizing revenue on V5, but we have completed revenue associated with V6. We do have some residual revenue to be recognized relating to the support of the Caltech mission, which we are currently still hosting. Our next, and as you know, that next revenue event would be the Transporter 9 mission around the October timeframe.

And just following up on that mission, is all the capacity booked for that launch? And how many deployments would full capacity represent?

In November, its John and Michael. Thank you for the question. In November, we will launch at least three satellites mentioned and potentially one additional one that we are working with a customer on. The three satellites would be from SatRev in Poland, also one called JINJUSat-1 from CONTEC in South Korea, and a third one from Lunasonde, which is a U.S.-based company. And then, as I said, there is the potential for a fourth satellite, but that has not yet been confirmed.

Thank you for the information.

Thank you, Michael.

[Operator instructions] And we'll take a follow-up question from Michael Matheson.

Thanks, you guys. It looks like the way was clear for me to ask a follow-up. So, again, just sort of solving that equation of burn rate versus the cash on hand, you mentioned that you've taken a lot of steps to reduce the burn rate. Would you feel comfortable giving us any kind of a figure to work with or just lower as far as you wanted to go?

I'd say lower is probably about as far as we want to go. I think if you wanted to think about the subsequent quarter, definitely lower than our past quarter, right? We did that 30% reduction in headcount. And through the financials, you can get a sense that it wouldn't be a full 30% across the board with respect to cash on the quarter, but you can view it as we're pushing on it fairly hard to be able to get as much runaway as we can out of that.

Yes, exactly. Okay. Well, thank you again for the information.

Thanks, Michael.

Thank you. Gentlemen, it appears we have no further questions this afternoon. So, that will bring us to the inclusion of the Momentous second quarter earnings call. I'd like to thank you all so much for joining us today and wish you all a great evening. Goodbye.