Globalstar, Inc. · NASDAQ:GSAT
Globalstar — Investor Day (December 2024)
82 slides from Globalstar's investor day presentation, Dec 12, 2024
Slide 1: Analyst & Investor Day, December 12, 2024
Connect Smarter Proprietary & Confidential Analyst & Investor Day D e c e m b e r 1 2 , 2 0 2 4
Slide 2: Disclaimer
2 Certain statements contained in this presentation other than purely historical information, including, but not limited to, expectations regarding future revenue, financial performance, financial condition, liquidity, projections, estimates and guidance, statements relating to our business plans, o
Slide 3: Today's Globalstar Speakers
Today’s Globalstar Speakers 3 Tamer Kadous Vice President of Terrestrial Networks Mersad Cavcic Chief Marketing Officer Rebecca Clary Chief Financial Officer Alex Katko Vice President of Product Engineering Paul Jacobs Chief Executive Officer Tim Taylor Vice President of Finance, Business Operations
Slide 4: Today's Agenda
4 Today’s Agenda Topic Speaker(s) Start Time (ET) Speaker Introductions Jason Bernstein 9:00 AM CEO Overview Paul Jacobs 9:05 AM Terrestrial Wireless Kyle Pickens / Tamer Kadous 9:40 AM MSS Subscribers Mersad Cavcic / Alex Katko 10:30 AM Break 11:15 AM Government Mersad Cavcic 11:30 AM Wholesale Con
Slide 5: CEO Overview
Proprietary & Confidential / CEO Overview
Slide 6: Enabling mission critical connectivity
Enabling mission critical connectivity 6
Slide 7: Recent highlights and milestones
Proprietary & Confidential / Updated Services Agreement with Wholesale Customer New Satellite constellation Parsons mission-critical solution tailored for radio frequency congested environments partnership Commercial availability of XCOM RAN deployed by major global retailer First 5G RAN over n53
Slide 8: Globalstar at a glance
8 Globalstar, Inc. is the next generation mobile satellite and communications services provider 340+ Employees across 15 countries 120+ Countries Serviced 30+ Years in Business Spectrum L: 8.725 MHz S: 16.5 MHz (11.5 MHz Band n53) C: 339 MHz Government IoT XCOM RAN Band n53 Wholesale Consumer Retail
Slide 9: Global Footprint & Ground Infrastructure
Global Footprint & Ground Infrastructure 9 Globalstar International Terrestrial Status Terrestrial Authority Obtained Terrestrial authority in U.S., Canada, Brazil, Spain & Mexico is 11.5 MHz. Authority over South Africa, Botswana, Rwanda, Gabon, Mozambique, Kenya, & Namibia is 16.5 MHz. Globalstar
Slide 10: Business pillars: Spectrum, Flexible connectivity, Financial strength
GovernmentIoT XCOM RAN Band n53 Wholesale Consumer Retail Consumer 10 Spectrum Bent Pipe Flexible connectivity platform for affordable and mission critical applications Spectrum Capital asset to allow innovative market approach Financial Strength Recurring revenue with limited capex funding needs
Slide 11: Spectrum Update
11 Spectrum Update • The FCC approved an extension of existing authorization by 15 years to operate − Reaffirms our exclusive rights within the license portion of the Big LEO Band • The Commission explicitly acknowledged the essential nature of our voice and data communications services, particularl
Slide 12: Licensed MSS Spectrum
Licensed MSS Spectrum • Mid-band spectrum for mobility • Allows for small, lower cost and energy efficient terminals • Bent pipe architecture offers flexibility for ground upgrades • Satellite coverage across ~99% of world’s population • Low-latency and high-quality transmissions • Satellite procure
Slide 13: Constellation as a platform for innovation
• Constellation as a platform for innovation Limited investment capital allows for pathfinding opportunities • Multiple technologies and business models using available 15% capacity − Commercial IoT (currently one-way, two-way in alpha testing) − SPOT for consumer and enterprise − Government custome
Slide 14: Government, IoT and Retail Consumer
14 Government IoT Retail Consumer • Parsons exclusive partnership to support the public, government, and defense sectors • SPOT continues to be a significant revenue stream despite direct-to-device ("D2D") progress • Scaling Commercial IoT with new and expanding customers and applications in various
Slide 15: Wholesale Consumer
15 • Scale driven by smartphone innovation cycle • Validation of Globalstar's business model − Existing network architecture − Global dedicated spectrum − Operating excellence • Handset Original Equipment Manufacturer (OEM) share gain and replacement cycle Wholesale Consumer
Slide 16: Updated Services Agreement with Wholesale Customer
16 • Updated Services Agreement with Wholesale Customer − Expanded services to customer over a new mobile satellite services network − New satellite constellation − Expanded ground infrastructure − Increased global MSS licensing • Globalstar will retain control and operate network − 100% of terrestr
Slide 17: Band n53
17 • 3GPP band deployable in 12 countries for terrestrial use − 100% coverage over the U.S., Canada & Mexico • Platform to expand business dimensions − US: Mission critical applications aggregated with CBRS − Anchor for unlicensed cellular − Global private networks • Scaling through solution provide
Slide 18: Band n53 Mexico authorization and footprint
18 • Globalstar received 10-year terrestrial authorization from the IFT to deploy and operate Band n53 in Mexico • Globalstar Band n53 footprint now covers nearly 1B POPs over 12 countries • Band n53 Spectrum ecosystem and partners keeps growing and building revenue opportunities Band n53
Slide 19: XCOM RAN
19 • High performance 5G architecture to enable new use cases / verticals − Automation − Industrial 5G − Critical Infrastructure • Ease of deployment for mission-critical applications • Organic development by team of world class experts XCOM RAN
Slide 20: XCOM RAN commercial availability
20 • Commercial availability of XCOM RAN since Mobile World Congress (MWC) February 2024 • Solution being deployed by major global retailer with ongoing deployment in 2025 • First live 5G Radio Access Network over n53 XCOM RAN
Slide 21: Journey of Innovation – XCOM RAN
Journey of Innovation – XCOM RAN From Product Market Fit to Scale up 21 MVP (internally defined) Customer #1 Customer #2 Customer #3
Slide 22: Total Addressable Market
GovernmentIoT XCOM RAN Band n53 Wholesale Consumer Retail Consumer 22 Spectrum Private Networks (Target) Commercial IoT Government $0 $2 $4 $6 $8 $10 $12 $14 $16 TAM $B (in 2030) Consumer Retail Total Addressable Market (TAM) Sources: • Private Networks: SNS Telecom & IT Report 2024 • Commercial IoT
Slide 23: Partnership for Global Reach
23 Partnership for Global Reach Paul Jacobs Chief Executive Officer Strive Masiyiwa Founder & Executive Chairman
Slide 24: Terrestrial Wireless (Band n53 & XCOM RAN)
GovernmentIoT XCOM RAN Band n53 Wholesale Consumer Retail Consumer Spectrum Terrestrial Wireless (Band n53 & XCOM RAN)
Slide 25: Band n53 Overview
25 Band n53 Overview • Band n53 is a uniform and increasingly “borderless” spectrum resource • Provides reliable connectivity − Important and high-value use cases • A rare swath of mid-band spectrum not owned by a wireless operator − "Goldilocks" spectrum – propagation allows for building penetratio
Slide 26: Band n53 Market Opportunity
26 Band n53 Market Opportunity • Clean spectrum resource available for any wireless use case • Carriers or cable companies could add Band n53 to their spectrum inventory across their networks or at heavily used locations • Band n53 private 5G networks provide easy to deploy, campus-wide wireless con
Slide 27: Band n53 Milestones Met
27 Band n53 Milestones Met – Driving the Ecosystem • Regulatory – FCC approval • Standardization – 3GPP • Chipset inclusion – Qualcomm, GCT • Radios – Nokia, Airspan, CableFree • Modules – Global Telecom, Quectel, Telit Cinterion • Band n53 MHz – now integrated with XCOM RAN
Slide 28: Band n53 Increasingly Borderless
28 Band n53 Increasingly Borderless 12 countries 13.4 million square miles 4 continents All major countries in North America ~1 billion POPs covered 10 billion+ MHz POPs ~4 billion MHz POPs in the United States
Slide 29: Selected U.S. Spectrum Precedent Transactions
29 Band n53 Selected U.S. Spectrum Precedent Transactions $1.29 $0.54 $0.69 $0.56 $1.10 $0.96 $1.73 $0.52 $2.71 $0.49 $2.05 $0.92 $0.82 $1.07 $2.31 $1.74 $0.52 $1.51 $0.66 $3.16 $0.21 $1.10 Auction 1,002 Auction 73 DISH / Spring Anterix / Ameren Anterix / SDG&E Auction 66 Verizon / SpectrumCo Verizo
Slide 30: Band n53 Spectrum Value – The Big Question
30 Band n53 Spectrum Value – The Big Question • Based on historical transactions Globalstar's Band n53 spectrum could be worth between $0.5 and $2 per MHz-POP in the US alone − Implying value between $1 and $4 per share for just this spectrum • Bands with complete ecosystems trade at higher values •
Slide 31: Band n53 Summary
31 Band n53 Summary Perpetual Resource Spectrum is a perpetual resource, and we have a lot of it Demand We can meet the need for spectrum anywhere there is demand for it Flexibility We can take different approaches in different geographies Recurring Revenue Long term lease model, high recurring reve
Slide 32: Band n53 Panel
32 Band n53 Panel Neset Yalcinkaya SVP of America Sales Deborah Simpier Co-Founder & CEO Kyle Pickens VP of Strategy Tamer Kadous VP of Terrestrial
Slide 33: Spectrum + Technology = Unmatched Differentiation
33 XCOM RAN Spectrum + Technology = Unmatched Differentiation • Band n53 + XCOM RAN: Unique interlocked advantage − Global solution − Mission critical applications • Supercell: Radios constructively collaborate − No handover - homogenous coverage − Multifold increase in capacity • Revolutionary for
Slide 34: Pioneer New Markets & Compete Efficiently
34 XCOM RAN Pioneer New Markets & Compete Efficiently in Existing Ones • 5G Private Network (PN) hype − “Best efforts” served by enterprise Wi-Fi − 5G (like 4G PN) does not enable new use cases • New apps (Automation, XR, Mission Critical): − Demand enhanced performance − Limited by shared spectrum
Slide 35: XCOM RAN Market Opportunity
35 XCOM RAN Market Opportunity • Warehouse automation / dense industrial 4.0 − AI and autonomous industrial use cases will drive need for density solutions • Retail, fulfillment, and distribution centers • Enterprise, mining, campus networks, extended reality, energy platforms, stadiums, and campuse
Slide 36: XCOM RAN Early Market Validation
36 XCOM RAN Early Market Validation • Major global retailer Micro-Fulfillment Center (MFC) robotics − Systems sales + recurring revenue • Homogenous high performance in harsh environment
Slide 37: XCOM RAN Market Segments Targets
37 XCOM RAN Market Segments Targets High-end automation and enterprise − High value prop, low competition, perfect product-market alignment, sizable Opportunistic − More development not the focus unless clear opportunities General enterprise use cases − Expansion opportunities within existing custom
Slide 38: XCOM RAN Targeted Market Segments
$1.1 $1.5 $2.1 $2.8 $3.9 $5.5 $2.8 $3.7 $4.7 $6.0 $7.6 $9.6 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $16.0 2025 2026 2027 2028 2029 2030 Targeted Market Segments TAM in $B Target Oportunistic Rest of TAM 38 XCOM RAN Targeted Market Segments 30% CAGR Target Opportunity: 35% of TAM Target (25% of TA
Slide 39: XCOM RAN Building Blocks
39 XCOM RAN Building Blocks BBU = Server DU + CU Dashboard Standard APIs Internet 1 U XCOM RAN Technology Off-shelf network switch Radio Units • Open-RAN • Stack evolution • Developed own radio • End-to-end solution partnering with core network provider NMS API & Dashboard Health Monitoring Performa
Slide 40: First Live 5G Demo on Band n53 with XCOM RAN
40 XCOM RAN First Live 5G Demo on Band n53 with XCOM RAN Tamer Kadous VP of Terrestrial Ashar Zia Head of SI&T
Slide 41: XCOM RAN Demo Setup
41 XCOM RAN Demo Setup • Over the Air: four radios x four devices on Globalstar Band n53 PN • Three device vendors: Quectel, Telit Cinterion, iPhone • 2,400 sq ft: High density • Demo story: Streaming with background traffic with and without XCOM technology
Slide 42: Retail Consumer & IoT
GovernmentIoT XCOM RAN Band n53 Wholesale Consumer Retail Consumer Spectrum Retail Consumer & IoT
Slide 43: Retail Consumer Overview
43 Retail Consumer Overview • ~260,000 active subscribers responsible for $44M in 2023 annual service revenue • 10,000 rescues celebrated in 2024 • Strong brand in outdoor/adventure segment with loyal customer base • Established distribution channels
Slide 44: Retail Consumer Marketing Opportunity
44 Retail Consumer Marketing Opportunity • Making targeted, strategic investments in growth segments • Maintaining profitable customer base • Looking ahead: − Enhanced product capabilities − Enterprise market expansion − Selective consumer focus
Slide 45: Retail Consumer Market Insights
45 Retail Consumer Market Insights 61% 28% 10% Very Important Important Somewhat Important Not Important Importance of durability and ruggedness of your satellite communications device? 85% 12% 3% Very Important Important Somewhat Important Not Important Importance of the battery life of your satell
Slide 46: Market Opportunity IoT
46 Market OpportunityIoT $2.4B TAM through various verticals Such as: • Transportation & supply chain logistics • Fleet management • Mining & mineral exploration • Animal health monitoring and tracking • Infrastructure projects in remote regions • Utilities • Automotive IoT Source: Transforma Insigh
Slide 47: Market Opportunity IoT growth
47 Market OpportunityIoT Growing from 13M connected devices in 2024 to over 80M connected devices in 2032, driven by expansion in transportation and logistics, animal tracking, and automotive IoT verticals $2.4B $6.1B Growth with ~12% CAGR Satellite IoT 2024 Autonomous Systems Machine-to-Person Smar
Slide 48: Globalstar Overview IoT
48 Globalstar OverviewIoT • Globalstar's LEO satellite constellation delivers cost-effective global asset connectivity • Enables tracking and monitoring to help reduce downtime, drive efficiency, prevent loss and more ~481,000 Average active devices providing value in various market verticals across
Slide 49: Technology IoT
49 TechnologyIoT Unmatched advantages in Cost, Size, Weight and Power consumption with one-way technology: • STX-3 modem • 2.87cm x 2.06cm • 0.14 oz (4 grams) • Multiple years on AAA batteries • Cellular IoT modem price point
Slide 50: Subscriber Diversity IoT
50 Subscriber DiversityIoT 6% 6% 8% 20% 10% 50% Subscriber Count by Region Asia Australia Brazil Canada Europe USA 5% 18% 11% 1%47% 13% 4% 1% Subscriber Count by Vertical Agriculture Animal Tracking General Telematics Government Oil and Gas Transporation and Logistics Utilities Source: Subscriber co
Slide 51: Closer look at Animal Tracking; Strong VAR Channel
Closer look at Animal Tracking • Unlocking this market vertical with breakthrough in TCO from Globalstar: − Currently tracking ~83,000 animals − Four partners leading the way: Findmysheep (42,000), Spotter (24,000), Ceres Tag (12,500), and GSE (5,000) 51 Strong VAR ChannelIoT 5 4 4 1 18 9 4 1 VAR Pa
Slide 52: Panel Discussion IoT
52 Panel DiscussionIoT David Smith CEO and Co-Founder Ceres Tag Mersad Cavcic Chief Marketing Officer Halvor Mjøen CTO FindmyAS Jeff Palmer Founder and CEO Global Satellite Engineering Redefining sustainability with Globalstar
Slide 53: Next Phase of Growth with New Technology
53 Next Phase of Growth with New TechnologyIoT Extend current simplex technology to include FWD link, maintain TCO focus with Cost, Size, Weight and Power consumption: • Support command, control, and acknowledgement messages leading to new use cases and market verticals • Half the price of other sat
Slide 54: Next Phase of Growth: $250-350M opportunity
54 Next Phase of Growth with New TechnologyIoT Pursuit of validated market opportunity worth $250-350M a year: • Beta trials expected in Q1'25 • Gaining market share with modem, module and turnkey products Technology Upgrade 35% 14% 9% 1% 0% 40% Satellite IoT Subscriber Market Share Iridium Orbcomm*
Slide 55: Panel Discussion IoT: Command, Control, Acknowledge, Grow
55 Panel DiscussionIoT Command, Control, Acknowledge, Grow Jamie Williams President TGI Connect David Goldstein President and CEO Asset Link Global Alex Katko Vice President of Product Engineering
Slide 56: IoT at Scale with Automotive
56 IoT at Scale with AutomotiveIoT Source: * eCall document EN15722:2020 eCall Data Telemetry Data Voice call w/ eCall Map tile + Traffic Live Navigation Video Call Internet Technology Segment Satellite Primary Hybrid Cellular Primary Data Usage (estimates) 125 bytes/incident * 1 KB/day per vehicle
Slide 57: Fireside Chat: Winning Connected Cars from Space
57 Fireside ChatIoT Winning Connected Card from Space Mersad Cavcic Chief Marketing Officer Reinhard Kromer-von Baerie CIO, Peiker Holding GmbH
Slide 58: Four Modes of Growth IoT
58 Four Modes of GrowthIoT Scale through automotive IoT Growth of the market itself (12% CAGR) 1 2 3 4 Increased ARPU (new capabilities) New technology introduction (two-way ) One-way differentiation (cost, size, weight, power)
Slide 59: Break
Proprietary & Confidential / 10 Minute Break
Slide 60: Today's Agenda
60 Today’s Agenda Topic Speaker(s) Start Time (ET) Speaker Introductions Jason Bernstein 9:00 AM CEO Overview Paul Jacobs 9:05 AM Terrestrial Wireless Kyle Pickens / Tamer Kadous 9:40 AM MSS Subscribers Mersad Cavcic / Alex Katko 10:30 AM Break 11:15 AM Government Mersad Cavcic 11:30 AM Wholesale Co
Slide 61: Government & Wholesale Consumer
GovernmentIoT XCOM RAN Band n53 Wholesale Consumer Retail Consumer Spectrum Government & Wholesale Consumer
Slide 62: Government Fireside Chat with Parsons
62 Government Paul Jacobs Chief Executive Officer Mike Kushin President, Defense and Intelligence Parsons Fireside Chat
Slide 63: Wholesale Consumer Overview
63 Wholesale Consumer Overview In 2022, we announced service with our Customer to provide direct to handset connectivity. Globalstar has allocated 85% of satellite capacity to support the following phases of this service: Current Existing constellation Next Satellites with service commencing in 2025
Slide 64: Wholesale Consumer Extended MSS Network
64 Wholesale Consumer Extended MSS Network • In November 2024, announced extension to its current service agreement with its Customer where Globalstar will provide: − New satellite constellation • Extended MSS Network will be owned by Globalstar Licensee, LLC (the “Globalstar SPE”) and operated by G
Slide 65: Wholesale Consumer Overview of Economics
65 Wholesale Consumer Overview of Economics • Customer fees include a recurring service fee, payments relating to certain service-related operating and capital expenditures, and bonus payments subject to satisfaction of certain licensing, service and related criteria. • 2021 Prepayment Agreement: $9
Slide 66: Overview of Economics (continued)
66 Wholesale Consumer Overview of Economics (continued) • 2024 Prepayment Agreement: $1.1 billion (Infrastructure Prepayment) to fund Extended MSS Network and $219 million (Current Debt Repayment) to retire the Company’s outstanding 13.00% 2029 Senior Notes. Prepayment balance reduced over time thro
Slide 67: SPE – Organizational Structure
67 Wholesale Consumer SPE – Organizational Structure Globalstar, Inc Globalstar SPE Ground Station Assets Regulatory Licenses Satellite Spectrum New Assets & Regulatory Licenses Globalstar Domestic & International Subsidiaries Customer80% 20% 100% of all terrestrial and MSS revenue
Slide 68: Extended MSS Network – Economics
68 Wholesale Consumer Extended MSS Network – Economics • Total Customer investment of $1.7 billion, including capex prepayments, debt repayment and equity investment • Repayment and redemption terms − Full paydown of the 2024 Prepay Agreement and redemption of the 20% equity investment are expected
Slide 69: Extended MSS Network – Economics (continued)
69 Wholesale Consumer Extended MSS Network – Economics (continued) • Globalstar’s incremental service fees tied to the cost of the Extended MSS Network, fees for providing new services to Customer, fees tied to expenses incurred for the provision of such services and performance bonuses • Agreements
Slide 70: Financials
Proprietary & Confidential / Financials
Slide 71: Financial Overview
71 Financial Overview $189M YTD 2024 Total Revenue (2) $105M YTD 2024 Adjusted EBITDA(1)(2) 56% YTD 2024 Adjusted EBITDA Margin(2) $52M Cash and Cash Equivalents (2) (1) Refer to reconciliation of Net Income (Loss) to Adjusted EBITDA in Appendix (2) Results shown as of or for the year –to-date perio
Slide 72: Financial Performance
72 Financial Performance • From 2021 to 2023, increased revenue at a compounded annual growth rate of 34% • Raised full year 2024 revenue in the range of $245 million to $250 million • From 2021 to 2023, increased Adjusted EBITDA at a compounded annual growth rate of 74% • Raised full year 2024 Adju
Slide 73: Balance Sheet & Liquidity Highlights
73 Balance Sheet & Liquidity Highlights Note: 2024 amounts above are for the year-to-date period ended September 30, 2024; NOL as of December 31, 2023. Improved Cash Flows Increased OCF from $22m in 2020 to $99m YTD 2024 Strengthened Balance Sheet Reduced Net Leverage from 10x in 2020 to 3x YTD 2024
Slide 74: Recent Strategic Actions
74 Recent Strategic Actions Nasdaq Uplisting • Globalstar announced in November 2024 that the Company will uplist to the Nasdaq Global Select Exchange • Expect to begin trading on the Nasdaq in first quarter 2025 Reverse Stock Split • Increase the per share market price to improve marketability and
Slide 75: Strategic Investments Scaled to Opportunities
75 Strategic Investments Scaled to Opportunities Incremental spending in the near-term to drive long-term shareholder value MSS 15% Capacity Utilization Government SPOT Retail Band 53 Commercial IoT XCOM RAN Investment Market
Slide 76: Forecast Updates
Forecast Updates 76 2024 $million except % Forecast Total Revenue $245 – $250 Adj. EBITDA Margin ~54% Reaffirming our 2024 forecast 2025 $million except % Forecast Total Revenue > $495 Adj. EBITDA Margin > 54% Introducing our 2025 forecast Longer Term $million except % Forecast Total Revenue $260 –
Slide 77: Q&A Session
Q&A Session 77 Tamer Kadous Vice President of Terrestrial Networks Mersad Cavcic Chief Marketing Officer Rebecca Clary Chief Financial Officer Alex Katko Vice President of Product Engineering Paul Jacobs Chief Executive Officer Tim Taylor Vice President of Finance, Business Operations & Strategy Kyl
Slide 78: Appendix
Proprietary & Confidential / Appendix
Slide 79: Capital Structure
79 Capital Structure (in millions, except for per share price) As of September 30, 2024 (except for share price) Share Price (as of December 10, 2024) $2.28 Basic Shares Outstanding 1,892.3 Plus: Treasury Method Shares 105.5 Adjusted Total Shares Outstanding 1,997.8 Market Capitalization $4,554.98 D
Slide 80: Net Income (Loss) to Adjusted EBITDA Reconciliation
80 Net Income (Loss) to Adjusted EBITDA Reconciliation (in millions) YTD Through September 30, 2024 Full Year 2024E Net Income (Loss) ($12.9) ($23.3) Interest income and expense, net 10.3 13.7 Derivative loss 0.8 1.1 Income tax expense 1.9 2.6 Depreciation, amortization, and accretion 66.5 88.6 EBIT
Slide 81: Operating Cash Flow to Free Cash Flow Reconciliation
81 Operating Cash Flow to Free Cash Flow Reconciliation (in millions) 2020 YTD Through September 30, 2024 Net cash provided by operating activities $22.2 $98.5 Net cash used in investing activities (14.5) (107.7) Less: network related capital expenditures (1) - 91.8 Adjusted net cash used in investi
Slide 82: Contact Us
Proprietary & Confidential / Contact Us Connect Smarter Investor Relations investorrelations@globalstar.com