Key Points
- AST SpaceMobile filed with the FCC on Sept. 8 to extend its 800 MHz satellite connectivity testing authority for another 30 days.
- The Space Development Agency backed AST SpaceMobile's application to test pulsed radiolocation in the 902-928 MHz band, highlighting expanding national security applications.
- Despite testing progress and a $30 million SDA contract, AST SpaceMobile faces deployment risks and posted a sixth consecutive earnings miss in the second quarter.
- Special Report: A $382 trillion migration and the position no one is talking about
Nearly a month after receiving approval from the U.S. Federal Communications Commission (FCC) to test its low Earth orbit (LEO) satellite connectivity using the 800 MHz spectrum for up to 100 commercially available and unmodified devices, space-based cellular broadband network provider AST SpaceMobile (NASDAQ: ASTS) is seeking an extension from the agency.
The SpaceX (NASDAQ: SPCX) competitor’s 30-day authority was granted by the FCC in mid-August. With that initial testing window set to expire in mid-September, AST SpaceMobile filed Sept. 8 to renew its 800 MHz authority for another 30 days, allowing continued broadband testing and demonstrations with federal government customers and partner mobile network operators.
Separately, the SDA urged the FCC to approve AST SpaceMobile's June application to test pulsed radiolocation capabilities in the 902–928 MHz band, saying those tests would advance an important national security objective.
At the time of writing, the renewal application is pending FCC approval. But the filing serves as the stock’s latest catalyst, with shares of ASTS up more than 11% since the start of September.
The Space Development Agency Support Expands AST SpaceMobile’s Government Opportunity
The SDA’s letter supporting AST SpaceMobile’s separate 902–928 MHz testing application comes after the agency awarded the Midland, Texas-based firm a $30 million prime contract on Feb. 23, 2026, under a different SDA program.
That agreement was executed under the Hybrid Acquisition for proliferated Low-earth Orbit, or HALO, program.
At the time, CEO of AST SpaceMobile USA Chris Ivory noted that the selection validated “AST SpaceMobile’s ability to rapidly operationalize commercial space capabilities for national security.”
In addition to AST SpaceMobile’s strategic commercial partnerships, the pact with the SDA further demonstrated that the company’s services have a range of government applications.
After the contract was awarded, acting director of the SDA GP Sandhoo said, “We are now using commercial solutions to quickly demonstrate mission utility, reduce risk for the operational layers of future tranches of the PWSA, and accelerate the delivery of cutting-edge capability to the warfighter.”
The SDA’s recent letter of support to the FCC demonstrates growing government interest in AST SpaceMobile’s BlueBird satellites beyond commercial 4G and 5G connectivity, and specifically offer national defense capabilities. Those applications include tactical communications, sensing, and pulsed radiolocation.
Additionally, the SDA would like to test pulsed radiolocation capabilities using AST SpaceMobile’s BlueBird constellation in the 902–928 MHz band. Those tests would involve short transmissions directed toward areas near AST SpaceMobile's gateway sites in Kapolei, Hawaii; Lanham, Maryland; and Midland, Texas
Endorsements from defense and national security agencies like the SDA can strengthen an applicant’s case with the FCC and potentially help expedite approval, as the agency weighs interference risks alongside public and national interests.
Importantly for shareholders, the SDA’s involvement shows that AST SpaceMobile is expanding its defense contract footprint, which could go along way in diversifying future revenue streams beyond its commercial partnerships with companies like AT&T (NYSE: T), Verizon (NYSE: VZ), Tokyo-based Rakuten (OTCMKTS: RKUNY), and real estate investment trustAmerican Tower (NYSE: AMT).
Despite Testing Progress, BlueBird Deployment Goals Remain at Risk
The company continues to pursue its goal of putting 45 BlueBirds into LEO by early 2027—a lofty target considering that the company has yet to deploy its next satellites, including BlueBirds 14, 15, and 16.
That cohort is in final preparation following the successful launch of BlueBirds 11, 12, and 13—the company’s largest arrays to date—on Aug. 5, with BlueBird 14 complete and BlueBirds 15 and 16 nearing completion. AST SpaceMobile has also confirmed that production is advancing through BlueBird 48.
Anexpedited launch schedule will go a long way in convincing investors that the company is capable of meeting its short- and medium-term goals, following a severe Q2 earnings miss that took the wind out of shareholders’ sails.
When AST SpaceMobile reported results on Aug. 10, it announced earnings per share (EPS) of negative 77 cents, missing the consensus forecast of negative 32 cents, and quarterly revenue of $31.52 million, also missing analyst expectations of $34.53 million. The EPS miss was AST SpaceMobile’s sixth consecutive, while the revenue miss was its seventh in the past eight quarters.
Wall Street Caution Meets Heavy Short Interest
With a current beta of 2.74, the stock is 174% more volatile than the broad market.
That, in addition to numerous other factors, has resulted in a consensus Hold rating, with six analysts assigning ASTS a Buy rating, five assigning it a Hold rating, and two assigning it a Sell rating.However, the average 12-month price target suggests more than 40% potential upside from current prices.
Institutional buying has remained robust. Over the past 12 months, inflows of $5.19 billion from 389 institutional buyers have easily surpassed outflows of just over $411 million from 114 institutional sellers.
But insider activity has notably favored sellers over buyers across the past year, with just two buyers accumulating just over $806,000 worth of ASTS against seven sellers liquidating more than $450 million worth of shares.
Meanwhile, current short interest stands at 20.83%, or approximately 64.14 million shares sold short as of Aug. 31, up 11.6% from the prior reporting period. That elevated short interest could contribute to additional short-term volatility.
Read this article online ›
The best investment opportunities don't wait. Get our research and stock ideas delivered straight to your smartphone—so you never miss a market-moving opportunity. Our text alerts ensure you see timely stock ideas and professional research reports instantly, whether you're in a meeting, commuting, or away from your desk.
Get Text Alerts from American Market News (free)
Comments
Post a Comment