Intuitive Machines - Earnings Call - Q4 2024

Executive Summary

• Q4 revenue of $54.7M grew 79% YoY, contributing to record FY24 revenue of $228.0M (nearly 3× 2023). Backlog reached a record $328.3M (+22% YoY). Cash ended 2024 at $207.6M; post-warrant redemptions, cash was $385M on Mar 10, 2025, leaving the company “financially secure, debt-free.”
• 2025 outlook: revenue $250–$300M; management targeting positive run-rate Adjusted EBITDA by Q4’25 and positive Adjusted EBITDA in 2026. Mix shift toward higher-margin data services (Near Space Network) highlighted.
• Profitability still developing: Q4 gross profit was $0.7M; operating loss $(13.4)M; Adjusted EBITDA $(11.2)M. Large non-cash fair value charges on earn-out and warrants drove GAAP net loss.
• Strategic catalysts: IM-3 mission (with first data relay satellite), two CLPS competitions in 2025, LTVS downselect expected 2H25, and expanding national security/data services footprint (authorization to work with other agencies).

What Went Well and What Went Wrong

• What Went Well

  • Strong top-line and backlog momentum: Q4 revenue $54.7M (+79% YoY); FY24 $228.0M; backlog $328.3M (+22% YoY). “Second consecutive quarter of positive gross margin.”
  • Balance sheet fortified: $125M equity offering in Dec 2024 plus warrant exercises; cash $207.6M at year-end and $385M by Mar 10; no public $11.50 warrants outstanding; opened a $40M undrawn facility.
  • Strategic progress in data services: sole-award Near Space Network (NSN) advancing; IM-3 to deploy first relay satellite enabling “pay-by-the-minute” services; Nokia’s lunar cellular payload deemed a “rousing success.”

• What Went Wrong

  • Profitability remains a work-in-progress: Q4 operating loss $(13.4)M; Adjusted EBITDA $(11.2)M; higher SG&A (public company costs, compensation, facilities) weighed on results.
  • Large non-cash charges drove GAAP loss: Q4 included $(86.3)M change in fair value of earn-out liabilities, $(41.0)M change in fair value of warrant liabilities, and $(25.1)M loss on issuance of securities.
  • Mission execution risks persist: IM-2 landing “didn’t go quite as planned,” necessitating a comprehensive “hot wash” through mid-April; however, payload operations captured most success payments and validated comms/navigation.

Transcript

Operator (participant)

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Intuitive Machines Q4 and Full Year 2024 Conference Call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automatic message advising you your hand is raised. Please note that today's conference is being recorded. I would now like to turn the conference over to Stephen Zhang, Head of Investor Relations. Please go ahead.

Stephen Zhang (Head of Investor Relations)

Good morning. Welcome to the Intuitive Machines Q4 and Full Year 2024 Earnings Call. Chief Executive Officer Steve Altemus and Chief Financial Officer Peter McGrath are leading the call today. Before we begin, please note that some of the information discussed during today's call will consist of forward-looking statements setting forth our current expectations with respect to the future of our business, the economy, and other events.

The company's actual results could differ materially from those indicated in any forward-looking statements due to many factors. These factors are described under forward-looking statements in the company's earnings press release and the company's most recent 10-K and 10-Q filed with the SEC. We do not undertake any obligation to update forward-looking statements. We also expect to discuss certain financial measures and information that are non-GAAP measures as defined in the applicable SEC rules and regulations.

Reconciliations to the company's GAAP measures are included in the earnings release filed on Form 8-K. Finally, we posted an earnings call presentation on our website, which provides additional context on our operational and financial performance. You can find this presentation on our Investor Relations page at www.intuitivemachines.com/investors. Now I'll turn the call over to Steve Altemus.

Steve Altemus (President and CEO)

Good morning, and thanks for joining our Q4 and Full Year 2024 Earnings Call. Just two years ago, we became a public company with a bold vision for the future. Over the past year, we've deliberately positioned ourselves for long-term success by expanding our technical capabilities, opening new revenue streams, and fortifying our financial position.

In the Q4, we reported revenue of $54.7 million, contributing to a record fiscal year revenue of $228 million. This exceeded the midpoint of our previous guidance range and is a reflection of our ability to execute and grow within the lunar commercialization sector. Our financial position remains robust. We ended 2024 with a record cash balance of $207.6 million, following a successful equity raise in December. As of March 10th, our cash balance stood at $385 million after recent warrant exercises.

This strong liquidity position ensures that Intuitive Machines is well-funded for the future. Now, with a fortress-like balance sheet, we're seeking the highest return opportunities, whether that's through internal innovation or strategic acquisitions. We got to this point because we choose to tackle one of the hardest challenges first, landing on the moon.

Now, the technologies and expertise that built our initial lunar program are ready to expand our reach into new markets and new customers. This year is not just about growth; it's about defining the future of our company and the industry itself. The Q4 welcomed a new administration that is revamping the whole of government, and NASA is not excluded from that. There's been a shift in how the federal government approaches the acquisition of technology-based goods and services, and we believe Intuitive Machines is well-positioned for this.

The new administration has signaled a strong emphasis on stretching the federal dollar by shifting from large, government-owned cost-plus development programs to commercial service models that leverage private sector innovation that demand service providers thrive in a fixed-price ecosystem with revenue service tail, similar to the environment Intuitive Machines has grown up in, with CLPS, with LTV, and the Near Space Network contracts.

The federal government changes and uncertainty at NASA is an opportunity for Intuitive Machines to expand our customer base into areas like national security space and broaden our service footprint in addition to lunar, further diversifying our role in the space economy. We're in a position to do this because we're operating an end-to-end lunar program with a regular cadence of missions. The infrastructure, expertise, and proven capabilities required for lunar missions inherently support a wide range of space operations.

Offering our validated technologies and capabilities is a natural progression into other markets. These technologies and capabilities form the foundation of our three pillars of commercialization. They are delivery services, data transmission services, and infrastructure as a service. What we've demonstrated from operating two lunar missions is that there are essential capabilities necessary for sustained and resilient operations across all three service pillars. The first is extensible and reliable space communications.

This secure and continuous connectivity is essential for transmitting data, coordinating missions, and making real-time decisions in flight and on the surface of any celestial body. The second is position navigation and timing, also known as PNT. Just as GPS enables seamless navigation on Earth, precise and repeatable navigation is required to support flight, orbit, and landing operations, surface mobility, and resource utilization. The final capability is autonomy and artificial intelligence.

Given the distance and complexity of space operations, autonomy and AI-powered systems play a critical role in managing assets, executing scientific objectives, and mission success. The IM-2 mission demonstrated significant advancements in all three capabilities. To be straightforward, spaceflight is a complex endeavor.

For every mission, we must accept a degree of risk and the possibility of subsystem faults. That picture is not always black and white. On one hand, our lunar lander, Athena, touched down inside a shallow crater of the Moon's South Pole, a place we believe holds frozen water trapped beneath the surface, but previous missions avoided because of the jagged terrain, deep craters, and brutal cold.

While Athena's landing did not go quite as planned, our teams accelerated payload operations, including operating NASA's PRIME-1 drill suite, Nokia's lunar surface communication system, Intuitive Machines' MicroNova hopper, and several commercial payloads, including a Japanese micro-rover and edge computing data center, to bring back valuable data capturing the majority of the outstanding $15.8 million of final success payments.

As a reminder, 90% of the NASA commercial payments and associated revenue is earned and paid before launch. On the other hand, from the moment Athena launched on February 26th, every mission stepped to landing, validated Intuitive Machines' ability to provide reliable space communications and navigation using our data transmission network.

Through the reliability of our network, we executed autonomous precision main engine firings on the way to the moon using our proprietary propulsion system, conducted precision orbital maneuvers, used AI-powered systems to guide our spacecraft across 39 lunar orbits, and performed high-bandwidth data transmission that outpaced IM-1's capabilities by 5x. All of this while demonstrating our network is interoperable with NASA's Deep Space Network and the National Radio Astronomy Observatory Network, a requirement for national security space.

The function of our spacecraft for the entire mission was nearly flawless, and its contribution towards advancing our data transmission network directly supports our execution of NASA's $4.8 billion near space network services contract and the company's position as a utility provider for space data transmission, similar to the way telecommunications companies bill customers on the amount of data they use.

Surface delivery missions like IM-1 and IM-2 provided the baseline for proving technology that leads to opening the space economy. For IM-2 and every space exploration mission, engineers conduct a critical post-flight review of the mission's performance. We call this a hot wash. Over the next several weeks, Intuitive Machines will lead internal, external, and independent reviews.

We invited NASA, the European Space Agency, and NASA's Jet Propulsion Laboratory experts to participate. Intuitive Machines expects to keep its third lunar mission on track for this time next year, incorporating findings and corrective actions from these reviews. The mission includes NASA and commercial payload delivery near the moon's equator, a generally flat terrain called Reiner Gamma. One of the mission's primary objectives is researching magnetic anomalies using rover technology.

In addition to the mission surface delivery, IM-3 will also deploy the first of five planned data relay satellites under the Near Space Network contract. The data relay satellite is deployed as a rideshare from the second stage of the rocket, independent of the lander. We demonstrated satellite deployment on our last mission with three rideshare payloads, including two that utilized our data transmission network for communication and navigation services.

The first data relay satellite deployment opens additional Near Space Network contract task orders beyond the initial validation task orders of $150 million for the contract, introducing a pay-by-the-minute service model, which we expect to have higher margin and recurring revenue streams. In December, Intuitive Machines secured additional awards under the contract for direct-to-earth services. We believe the additional awards position the company to capitalize on the full $4.8 billion maximum potential value.

We intend to deliver the second and third data relay satellites as rideshare payloads, along with our fourth NASA-contracted surface delivery mission, IM-4, in 2027, followed by the final two satellite deployments approximately one year later to complete the constellation. As I said at the top of the call, the new White House administration is instituting a more modern acquisition strategy for how to procure technology services.

We believe that benefits Intuitive Machines, and we're in a position to expand our customer base and apply those services in addition to lunar space without accepting excessive work. As we move into 2025, we're focused on diversification of customers and markets, and we've already made progress. Expanding data transmission services for our lunar satellite constellation outside the Near Space Network contract needed authorization to work with other government agencies, and the company now has those permissions.

To capitalize on that opportunity, Intuitive Machines appointed James Hrock as Senior Vice President of Data Services in the Q1 of this year. Jim has more than 30 years of experience in national security, commercial satellites, intelligence, surveillance, reconnaissance, and other critical programs in government and commercial industry.

Our lunar lander performance in getting to and operating in orbit was exceptional during IM-2, and we're actively leveraging that capability, finalizing a phase two contract with a government customer for an orbital transfer vehicle. The contract is designed to advance in-space mobility and logistics using the same lunar lander core technology in this orbit delivery vehicle. Last year, NASA proposed cancellation of the on-orbit servicing assembly and manufacturing project, OSAM. We're now capitalizing on NASA's traditional contracting investment to develop low Earth orbit programs.

By right now, we're conducting a Space Force study on how to commercialize OSAM for geostationary orbit, a new playing field for Intuitive Machines. We believe this co-investment model is the kind of forward-thinking approach the new administration is encouraging in its acquisition strategy. Finally, financially, we remain strong with growing revenue, expanding margins, and a record cash balance. 2025 is about execution.

As the company expects two NASA Commercial Lunar Payload Services contract bids this year, the first is due in May with an anticipated contract award in July, followed by an additional task order later in the year. In addition, Intuitive Machines has been invited to speak to the House of Representatives on our vision for the next version of CLPS to include larger cargo-class lunar deliveries, potentially creating high-margin opportunities.

Our vision for heavy cargo-class landers applies directly to our lunar terrain vehicle delivery service, which we anticipate will be awarded in the second half of 2025. That concludes my comments. Now I will hand off to Peter McGrath, our CFO, for further comments on our financials.Pete.

Peter McGrath (CFO)

Thank you, Steve, and thanks to everybody joining us today. As Steve mentioned, we ended the year strong with Q4 revenues of $54.7 million, up 79% over the same quarter of the prior year, and finished with record highs in both cash and backlog. Q4 revenue was primarily driven by CLPS, OMES, and LTV execution. OMES revenue was $30 million in the quarter, down about $4 million from Q3, as expected. Keep in mind, as Steve mentioned, we are performing a study to commercialize the use of OSAM for the space force.

Gross profit was $0.7 million for the quarter versus $0.3 million in the prior year, as we drive consistently towards profitability. Operating loss for the quarter was $13.4 million versus a loss of $7.5 million in the Q4 of 2023. The higher operating loss in the quarter was driven primarily by a higher SG&A. SG&A for the quarter was $13.5 million versus $6.4 million in the prior year.

A higher SG&A was due to increases in public company costs, employee compensation and benefits, and rent on our corporate headquarters, as well as our new offices in Maryland and Phoenix. Prior year also included the impact of incentive comp accrual reversal as we look to preserve cash. Current SG&A cost represents our estimated steady state of business going forward.

Operating cash used was $2 million in the quarter with a capital expenditure of $4.9 million, resulting in a free cash outflow in the quarter of $6.9 million. As we mentioned on the last earnings call, favorable operating cash in Q4 included the timing impact of two significant receivables, specifically timing on OMES and the IM-4 milestone one payment.

CapEx in the quarter was driven primarily by the investments in our first Near Space Network satellite. Going forward, we expect to see CapEx for our five-satellite constellation around the moon in support of NSN. These CapEx levels will be offset by higher margin service revenues from the NSNS program. Our cash balance significantly increased in Q4 to $207.6 million, another company record.

This increase was driven by $116.9 million of cash raised in the quarter, which included a $10 million strategic investment from Boryung Corporation and the remaining from our follow-on equity offering. Note that more recently, in Q1 2025, we cleaned up the majority of our overhangs since de-SPAC, namely through the redemption process of our $11.50 strike price warrants.

The majority of our warrants were exercised at $11.50 each, resulting in $148 million of cash to the company. 6.6 million warrants were unexercised and exchanged for one cent each. We currently have no outstanding $11.50 public-issued warrants. As of March 18th, we had 178.3 million shares outstanding following the warrant redemption process, with 115.7 million shares of Class A and 62.6 million shares of Class C.

The exercise of warrants, along with diligent cash management to start the year, resulted in a cash balance of $385 million as of March 10th of 2025. To further fortify our liquidity position, while in a position of strength as a company, we opened a $40 million credit facility with favorable financial terms.

This facility remains unused and is meant to smooth out our working capital ups and downs as we work through the timing impact of milestone payments for our programs and our respective cost schedule. We ended the Q4 with contracted backlog of $328.3 million, another record for the company. We expect to recognize 60%-65% of our backlog during 2025, 15%-20% during 2026, and the remaining thereafter.

Keep in mind this does not yet include the full set of initial task orders for the Near Space Network Services contract totaling $150 million or any new awards we may receive throughout the year. Moving on to guidance, last year our revenue was $228 million, and for 2025 we see a range of $250-$300 million.

The accepted growth of our key programs is expected to more than offset the impact of OSAM, which was roughly 40%-50% of the OMES revenue in 2024. This represents a tremendous shift in our business mix as we focus on expanding revenues into higher margin services. On the profitability side, we are continuing to demonstrate improvement in margins with a focus on having a positive runway adjusted EBITDA by Q4 of 2025 and a positive adjusted EBITDA by 2026.

Overall, this was another strong quarter and a historic year for Intuitive Machines. Last year, we set aggressive but reasonable guidance targets. We're proud to have exceeded the midpoint of the range. We effectively managed cash and set the company up with a fortress balance sheet, a streamlined capital structure with a substantially reduced overhang from derivative securities and no outstanding debt. We look forward to continuing this growth trajectory in 2025 with a focus on driving towards profitability and achieving our financial targets. With that, Operator, we are now ready for questions.

Operator (participant)

Thank you. Please enjoy one last reminder to ask a question you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, simply press star 11 again. Please stand by while we compile the Q&A roster. Our first question coming from the line of Suji Desilva with Roth Capital. Yolanis Malvin.

Suji Desilva (Managing Director and Senior Research Analyst)

Hi, Steve. Hi, Pete. Good morning. Maybe you can talk first about the, you talked about the funding and the balance sheet being stronger and, strategic moves beyond NASA and cislunar expanding reach new markets customers. Steve, maybe you can give a framework of sort of where you could see Intuitive Machines headed, you know, three to five years out that would kind of paint a picture of what you might be thinking of beyond, what you've done to date.

Steve Altemus (President and CEO)

Yeah. Good morning, Suji. Thanks for the question. Yeah when we think about the company, we're really moving into this data services business, full court press here because what we see, the lunar data network that we're installing with the data relay satellites and the ground stations is really, I would deem, a national asset, and that asset can be used by many different customers.

It also gives us the capability for, you know, alternate forms of GPS. It gives us ability to communicate in a difficult location around the moon, but those services can also be brought back towards Earth. You see us expanding in the near-space network regime, at multi-layer domains in space from low Earth orbit to geosynchronous orbit out to CisLunar space. We're just doing it in reverse order from lunar space back, backwards. That's what you can look for over the next three to five years.

Suji Desilva (Managing Director and Senior Research Analyst)

Okay. Maybe you could touch on specifically the orbital terrain vehicle, the spacecraft there, and you said there's a government contract there. Maybe you can talk about that product line and how we should think about that.

Steve Altemus (President and CEO)

Yeah. The Nebula, as we call it, is a derivative of the Nova-C Science Autonomous Robotic Lander that we flew to the moon twice. It is a cryogenic stage, essentially a third stage, if you will, with our proprietary propulsion system. We can deliver satellites, multiple satellites to varying locations in space, around CisLunar space. That is of interest to some customers, and we are doing that under a commercial contract as a subcontractor for a government customer.

Suji Desilva (Managing Director and Senior Research Analyst)

Okay. Great, Steve. Last question. I'll pass it along. As you talk about 2026 adjusted EBITDA positive, maybe you could talk about two elements of that, guidance in terms of the, maybe long-term growth rate of the revenues. That would be a reasonable set of bands to think about. And then the operating expense growth expectation to kind of get to that 2026 guide.

Peter McGrath (CFO)

Yeah. I probably won't provide guidance on what our growth rate is going forward beyond 2025, but, you know, if you look at where we were in terms of our run rate and our G&A expense, we've stabilized around a good G&A spend rate, which is going to really help us as we continue to grow on the profits and the margin side towards that EBITDA positive case.

Suji Desilva (Managing Director and Senior Research Analyst)

Okay. Appreciate the color, Pete. Thanks, guys.

Operator (participant)

Thank you. Our next question coming from the line of Mike Crawford with B. Riley Securities. Yolanis Malvin.

Mike Crawford (Senior Managing Director and Head of the Discovery Group)

Thank you. Regarding the lunar terrain vehicle down select, which you said you still expect to occur in 2025, is there anything from that baked into the current guidance?

Steve Altemus (President and CEO)

Mike, the way we look at that one is that will affect 2026 primarily and not necessarily 2025 with that award coming so late in the year, we believe. There are alternatives that the government may consider in terms of how they award that. They may choose multiple bidders, down select to two, take two to CDR, or give the full demonstration to a single bidder. I'm not quite sure what the shape of that procurement will look like, but we did not include any of the LTV beyond the initial $30 million in the operating plan for 2025.

Mike Crawford (Senior Managing Director and Head of the Discovery Group)

Okay. And then, thank you. Regarding the data relay satellite deployments, is there an order to the range points that you're targeting for the second and third payloads and beyond?

Steve Altemus (President and CEO)

Just to clarify, you're looking for the timeline for deployment of the satellites?

Mike Crawford (Senior Managing Director and Head of the Discovery Group)

Yeah. Does it matter to which location each goes to in order?

Peter McGrath (CFO)

Go ahead.

Steve Altemus (President and CEO)

Our current baseline plan is that the first satellite will go up as a rideshare on IM-3, which is scheduled for about this time next year. The second and third will go up as a rideshare on IM-4, which we're currently slating for the second half of 2027. The fourth and fifth would go up about a year after that. they're all going to a highly elliptical, polar orbit around the moon that will have a long stair time around the South Pole, which is a requirement from NASA in terms of the coverage over the South Pole region.

Mike Crawford (Senior Managing Director and Head of the Discovery Group)

Okay. Thank you very much.

Operator (participant)

Thank you. Our next question coming from the line of Austin Moeller with Canaccord Genuity. Yolanis Malvin.

Austin Moeller (Analyst)

Hi, good morning. Just my first question, has the data collected during IM-2 impacted your conversations with NASA or plans for the upsized Nova-D lander? And has NASA decided if they will pay a vendor to deliver the VIPER over yet?

Steve Altemus (President and CEO)

With respect to Nova-D, we're currently in the design cycle to get to preliminary design review for the demonstration mission for LTV delivery. Nova-D continues on. We are doing the hot wash associated with IM-2 and the faults we saw in the laser altimeters.

We're doing a complete system review. I don't expect much change to the way the design's going for Nova-D coming out of that hot wash. Like I said in my comments, Austin, we'll actually look at any effects to IM-3, other than the laser rangefinders, that might be incorporated into that mission this time next year. The other part of your question was the VIPER.

Right now, NASA put out an RFP to industry to say, after they looked at all of the RFIs that were submitted and said, "Hey, submit a proposal," they'll do a down select. Once they see all those proposals, we expect that down select here shortly, probably by the end of the month. Then they'll do a kind of a down select from those ones that give a good plan or meet the competitive range.

I'm not sure what we're going to do with that VIPER yet. The way that came out, that's got to be fully funded, without the government, without NASA. NASA retains all the data, so it's quite limited in our ability to commercialize it. We're still thinking about what we want to do there.

Austin Moeller (Analyst)

If we just think a little bit further out, the new administration has said they have Mars as a priority. Has the new administrator discussed with you or the other CLPS participants an equivalent program for doing commercial landers on Mars, just given the cost overruns on Mars sample return?

Steve Altemus (President and CEO)

We've been talking for about two years now with the agency and the administrators and deputy administrators of the agency about using the CLPS model to replace the aging infrastructure around Mars. That conversation has been well received so far we have not had discussions yet about how that might play in this administration, or with this new administrator, once confirmed.

We plan to have those discussions and see what that might be. I would say, though, that it is clear to us from our discussions on the Hill with everybody that we run into and talk to and meet with, that the moon is of strategic interest and will remain that way. The idea of Mars first or Mars only is really not the mainstream thinking at this time. Mainstream thinking is that, you know, a stretch goal for Mars is a good thing for the country. The moon is of strategic interest and will remain so.

Austin Moeller (Analyst)

Thanks for all the details there. I'll pass it back. Thank you.

Steve Altemus (President and CEO)

Great.

Operator (participant)

Thank you. Our next question coming from the line of Andres Juan Sheppard-Slinger with Cantor Fitzgerald, Yolanis Malvin.

Andres Sheppard (Research Analyst)

Hey, everyone. Good morning. Congratulations on the quarter, and thanks for taking our question. Was just wondering if maybe you could elaborate a little bit further on some of the data that you were able to procure from the IM-2 mission, maybe particularly on the Nokia side. Just curious if you could tell us, you know, how, how did that communication work out and versus expected. Thank you.

Steve Altemus (President and CEO)

Yeah. Good morning, Andres. Let's see Nokia Bell Labs had a fully successful payload operations on the moon where they tested out each element of their cellular network with us. Even though we were on our side, they, Nokia, was able to power up and communicate with each part of that network, demonstrating that that technology, Earth-based technology hardened for space, was successful.

This is really a good news story in terms of how you can take that technology all the way to TRL level nine. And now we have the basis for surface communications between elements on the moon. A rousing success for Nokia Bell Labs.

Andres Sheppard (Research Analyst)

Very helpful. Appreciate that color. Maybe just as a quick follow-up, Steve, you touched on this a little bit on the call, but maybe just remind us, you know, what are the key catalysts, maybe the near-term key catalysts that you think investors should be aware of, you know, as we look, you know, for in 2025? Thank you.

Steve Altemus (President and CEO)

Yeah. Right now, the team is getting ready for the Nova-D design cycle review with NASA on that delivery vehicle, the heavy cargo variant for delivery of the LTV. We'll also do preliminary design review with NASA in the first half of this year on the LTV itself, lunar terrain vehicle. You heard that we're going to have the next CLPS mission called CS6 procurement in May. Proposals are due with award in July.

Finally, there's a third project or contract. That's the second CLPS award this year, which we expect later in the year. Those are the big contract award milestones while we prepare our first satellite for launch on IM-3 this time next year. That satellite will be delivered for integration to us for our payload integration this year and ready to fly early next year.

Andres Sheppard (Research Analyst)

Super helpful. Thank you so much, and congrats again. I'll pass it on.

Steve Altemus (President and CEO)

Thank you.

Operator (participant)

Thank you. Our next question coming from the line of Edison Yu with Deutsche Bank, Yolanis Malvin.

Edison Yu (Equity Research Analyst)

Hey, good morning. Thanks for taking our questions. First, I wanted to ask about the cash. You're obviously in a very good position now after the recent raises. How are we thinking about deploying that? Do you have a pipeline of M&A that might be of interest?

Steve Altemus (President and CEO)

We have a continuing process of review for opportunistic M&A where we review what capabilities as a company we want to put add on, where we have soft spots in the supply chain, for example, or where we want to vertically integrate. We also want to think about markets and opening up a new customer and diversify our revenue stream we look at these on a continuing basis and will be strategic in our assessment of M&A going forward.

There's also a number of technology innovations that we want to on-ramp. In particular, you know, for the Nova-D, we want to make sure that the propulsion system is developed in a way that can support the heavier cargo lander, For example, investment in an E-pump project to put electric pumps on the main engine would be a good project we've already started. There will be some of those innovations we'll be doing with the capital and some of the strategic M&A we're thinking about will continue.

Edison Yu (Equity Research Analyst)

Understood. A follow-up. You mentioned the new administration earlier. I'm wondering if you can talk about the potential opportunities in defense in the context of some of these big programs. Is there a lot of incremental TAM that could be derived from some type of DOD defense path?

Steve Altemus (President and CEO)

Yeah. The way I talk about defense tech or DOD tech is really national security space tech. As we're building out our network, the Near Space Network services, there's a lot of space domain awareness, space traffic management capability by having assets in and around the moon that we can move into that market. Like I said, other areas where communications are needed.

Data relay, we have that architecture now and that IP associated with flying those kinds of data relay satellites with those kind of radio packages and sensors. All that can be applied to that national security space market.

Edison Yu (Equity Research Analyst)

Thank you.

Operator (participant)

Thank you. Our next question coming from the line of Ronald Epstein with Bank of America, Yolanis Malvin.

Ronald Epstein (Managing Director in Equity Research)

Hey, yeah. Yeah. Good morning, guys. I mean, so far we've covered a lot of ground, but just wanted to circle back on what's your thinking on the impact that, you know, the Department of Government Efficiency could have on, on NASA, what it could mean for you guys. You know, Musk seems to be a big influence here, and he keeps talking about Mars and, you know, how, how do we circle that all up and what's it mean for you?

Steve Altemus (President and CEO)

I think the Department of Government Efficiency is looking to drive efficiency within NASA in particular, in our case. The monies that are captured or saved can be applied to commercial space endeavors that could be more efficient.

Like I said, Intuitive Machines is in a position now where we can navigate this kind of commercial market. We're driving innovation in a rapid, affordable way to deliver space systems reliably. That is attractive for this modern era or modern administration approach towards NASA. I think this is good, This is the way the space agency can get more accomplished and be more globally competitive.

I think in the end, while there might be reformulations within Artemis or changes within the civil servant workforce of NASA, the efficiency of the government driving innovation and delivering space systems on a regular cadence is only good for, like I said, our global competitiveness. I think that's a good thing. Mars first. Mars is further away. As an architect, space architect, I could tell you it's more than a presidential administration away.

While we can have a stretch goal to aim and build the technologies for Mars, like I said, the moon is of strategic interest and will remain so that is where our focus will be. However, a lot of our technologies are extensible to deeper space. We will be looking at opportunities to replace some of the aging infrastructure around Mars if that is the direction the country wants to go.

Ronald Epstein (Managing Director in Equity Research)

I mean, just maybe two follow-ons if I can. Be it that Mars is farther away, right, if we look at it as an opportunity, would not that suggest that that is just a lot more work, which could potentially be good for you if they were to go that way? Meaning, you know what I mean? Like, it is a bigger hurdle, but the bigger hurdle would require more funding. I don't know if I'm thinking about that right, but if they do push that way or maybe push that way in parallel, that could potentially be good, right?

Steve Altemus (President and CEO)

I think if you think about constrained budgets, that's one of the factors that the House and the Senate are going to have to deal with in how they fund future space programs. If we say that there's efficiency coming out of NASA, the Artemis program may move to the right.

What's important is that the Near Space Network is decoupled from Artemis currently in the budget, and that gets implemented so that we have a strategic asset in and around the moon. We revamp the Mars sample return to become more affordable. That might create more opportunity to put the aging infrastructure replacements in orbit around Mars.

You have to look at all the deck chairs and how they get shuffled. All of this speaks to the need for agile commercial space involvement in not only opening the cislunar economy, but actually, contributing to commercializing Mars.

Ronald Epstein (Managing Director in Equity Research)

Got it. Maybe this is the last one. If, you know, we're in a continuing resolution for fiscal 2025, I mean, it seems like that's what's going to happen, right? Maybe just a hair away from that. A lot of people are now talking that fiscal 2026 could be a continuing, continuing resolution. How does that impact you? I mean, when we think about your business and, you know, a CR or two years of a CR?

Steve Altemus (President and CEO)

Our company currently is working on existing programs that are covered under the continuing resolution. Those programs exist, moving forward would exist moving forward in a continuing resolution in 2026, obviously. It might, we'll have to see about what happens there. I did mention I'm going up to testify in on the House subcommittee, to talk about CLPS 2.0 and the follow-on and how moving towards, heavier cargo deliveries. Right now, CLPS is funded. NSNS is funded. LTV is funded so, all our programs there with NASA seem to be in a good position

Ronald Epstein (Managing Director in Equity Research)

Gotcha. All right. Thank you.

Operator (participant)

Thank you. Our next question coming from the line of Josh Sullivan with The Benchmark Company, Yolanis Malvin.

Josh Sullivan (Managing Director and Senior Equity Research Analyst)

Hey, good morning. Good morning, Josh. Just on, on the comment earlier on the, on the full-court press into data services, can you talk maybe about Jim's appointment? You know, how are you modeling that long-term communications revenue model at this point? You know, what is his appointment or perspectives add?

Steve Altemus (President and CEO)

Jim Hrock was an addition. We were very fortunate to bring Jim on board. He has incredible experience in bringing in, like starting DigitalGlobe, which then went to Maxar. He's worked for Lockheed. He's worked for NASA, He's got incredible depth of experience in data services, you know, from Earth observation kind of data services. You know, when we think about the Near Space Network, we think about data services. Actually.

If you also recall that we now run the LRO, SH camera, Lunar Reconnaissance Orbit camera, and the ShadowCam with a group in Phoenix. We have the largest repository of lunar data that we steward for NASA. We talk about integrating the data products that are collected by LRO with our own data products. We can start to get serious data content out of this network. Jim is the one who knows how to commercialize that, having done that three times.

He also brings incredible experience in national security space and connections where we can actually build this network, like I said, as a national asset to serve other government agencies as well. That is really his forte. That is why we brought him in, as we did. We are very proud to have him on board.

Peter McGrath (CFO)

Got it.

Josh Sullivan (Managing Director and Senior Equity Research Analyst)

Steve, on your plans to speak to Congress on CLPS, you know, what needs to be communicated at that event? Or maybe what does Congress need to be convinced of that it is not already inclined to pursue, you know, with CLPS-like models?

Steve Altemus (President and CEO)

The success of the lunar commercialization and where we're going with that in terms of communications, space traffic management, developing infrastructure and factories on the moon is essential for our strategic interests. Now, if you think about CLPS and how you can alter the first CLPS program into the 2.0 would be to move towards heavier and heavier cargo so that sets up that logistics supply that we can get equipment to begin building these factories on the moon and to begin, you know, working autonomously on the moon.

By emphasizing heavier cargo, spreading that delivery across multiple directorates within NASA, multiple budget line items to serve not only science, but the human space flight side, the space technology side, the exploration side. All of that is what we want to communicate to the House about the CLPS 2.0.

Josh Sullivan (Managing Director and Senior Equity Research Analyst)

Got it. Thank you for the time.

Steve Altemus (President and CEO)

Okay.

Operator (participant)

Thank you. Our next question coming from the line of Greg Pendy with Clear Street, Yolanis Malvin.

Greg Pendy (Managing Director, Senior Analyst and Stock Analyst)

Hey, guys. Thanks for taking my question. Just I know you're going through the hot wash right now, but just from, you know, the targeted mission for IM-3 with the Rhino Gamma region of the moon, what type of flexibility would you have on that region to possibly push the data out further if you felt you needed that time? What does the launch windows look like for that region of the moon? Thanks.

Yeah. We have quite a bit of flexibility if needed. Right now, we're not anticipating a shift in the schedule. Should that unexpected shift occur, we have several months of give in that schedule to still meet that equatorial mission to Rhino Gamma. It's not as highly constrained as the South Pole missions are, which seem to be occurring in the Q4 and Q1. This can extend first and Q2 easily.

Right. And then just one, just one more on that IM-3 mission. What type of timeline would you think you'd need for commissioning on that first, the first satellite, before you can get the follow-on task revenue opportunity?

Steve Altemus (President and CEO)

Yeah we think you get that orb, that bird up and in its polar orbit. We have about a 60- to 90-day commissioning period before we do a communications check, data relay check with an asset in orbit. Our satellite to another asset, that check is a validation task order. Then we can start the follow-on operational task order.

Greg Pendy (Managing Director, Senior Analyst and Stock Analyst)

Great. That's helpful. Thanks a lot.

Steve Altemus (President and CEO)

Sure.

Operator (participant)

Thank you. Our last question in queue coming from the line of Eric Brunson with Stephens, Yolanis Malvin.

Eric Brunson (Analyst)

Yeah thanks, for taking the questions. You guys gave an outlook for 2025, $250-$300 million in revenue. Any insights that maybe you can share that get you to this range? And then maybe just how should we think about the shape of that growth throughout the year?

Peter McGrath (CFO)

I guess we'll start with the fact that if you look at the backlog numbers and the percentages I talked about earlier, it gives you a good indication that a lot of our revenue to get to the bottom of the range is from existing contracts and work we have in front of us.

Because those are on contract, they're going to be throughout the entire year. So that's a pretty steady rate of revenue. What we're looking to grow with are the things that Steve mentioned earlier about the opportunities that we have in front of us this year, which include two CLPS opportunities. There is potential upside depending on what happens with the market and the congressional direction as to funding and NASA direction as to where programs are going.

Like things where LTVS could actually be awarded this year and there could be revenue this year. We're not putting that in our plan today, but that gives us some opportunities. That allows us to fit within the range.

Eric Brunson (Analyst)

Great. Maybe just, I know the hot wash review's ongoing and you just still have a lot of work to be done. Any sort of initial observations that maybe you can share? I know, coming out of IM-1, there was around 60-some-odd items that you needed to address, coming into IM-2. Would you expect that list to be maybe as much or greater or less than, you know, maybe just some initial thoughts would be helpful?

Peter McGrath (CFO)

The hot wash is set up in, it's our own idea about coming from our experience with working with human space flight programs. We take a 30-day period, very focused timeframe, short interval, but very focused.

We examine every aspect of the development, the development testing, the assembly, integration, and functional testing of the vehicle, how we did at the Cape, when we went to Florida to do the integration of the payloads, how the launch wet dress rehearsal went and how the launch went, how the mission all unfolded, and how each phase of the mission all the way down to the surface and the payload operation.

We are very comprehensive when we take a look at this. We identify not only what went wrong, what went right, where, but where there were some soft spots that could use shoring up to increase reliability or what were the faults that occurred and what we need to address.

Those get binned in a set of categories of those that need to be implemented for the next immediate mission or those that can be carried as fleet upgrades as we go forward, in the future. That is kind of the process, We expect our internal review meeting on April 3rd, where we will hear findings from across all the subsystems.

We will probably close that out where we will finalize everything, around the 15th of April. From there, we are going to, you know, talk it to all our stakeholders, our customers, our NASA stakeholders, and share it, our lessons learned. We are very transparent. Like I said, we have some external reviewers from NASA, ESA, and JPL that are subject experts. We are looking forward to the findings because it only makes us better and stronger.

Eric Brunson (Analyst)

Great. Thanks for that. Good luck.

Peter McGrath (CFO)

Thank you.

Operator (participant)

Thank you. I'm showing no further questions in the queue at this time. I will now turn the call back over to Intuitive Machines CEO, Mr. Steve Altemus, for any closing remarks.

Steve Altemus (President and CEO)

Thank you, everybody, for your participation and your questions. We're looking forward to another exciting year of growth for Intuitive Machines in 2025 thank you.

Operator (participant)

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.