Hello and welcome to the Terran Orbital first quarter 2023 earnings call. My name is Elliot, and I'll be coordinating your call today. If you would like to register a question during the presentation, please press star followed by one on your telephone keypad. I'd like to hand over to Jonathan Siegmann, Senior Vice President of Corporate Development. The floor is yours. Please go ahead. Thank you, Elliot. Good morning, everyone. Thank you for joining Terran Orbital's first quarter 2023 earnings call. With me this morning are Marc Bell, Co-founder and Chairman and Chief Executive Officer of Terran Orbital Corporation, and Gary Hobart, Chief Financial Officer of Terran Orbital Corporation. Marc will provide a business update and highlights for the past quarter, and then Gary will review the quarterly results. Terran Orbital's executive team will then be available to answer your questions. During today's call, we may make certain forward-looking statements. These statements are based on our current expectations and assumptions and as a result are subject to risks and uncertainties. Many factors could cause actual events to differ materially from forward-looking statements made on this call. For more information about these risks and uncertainties, please refer to the company's filings with the Securities and Exchange Commission, each of which can be found on our website, www.terranorbital.com. Readers are cautioned not to put any 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 refer to certain non-GAAP financial information on today's call. You can find reconciliations of the non-GAAP financial measures with the most comparable GAAP measures in our earnings press release. With that, I will turn it over to Marc. Thank you, Jon. Thank you everyone for joining our first quarter 2023 earnings conference call. I am excited with our year-to-date performance, especially our order flow. A new, even broader mix of customers are increasingly looking to Terran Orbital for the design and manufacturing of their satellite constellation and a new space-based projects. Customers are choosing us because of our 10-year-plus track record of success, our state-of-the-art design and mission breadth, our rapid paced increased manufacturing speed, and our world-class quality. We added a $2.4 billion 300 satellite order from Rivada Space Networks in February, which we believe is the largest single commercial constellation award ever. This has driven our March quarter end backlog to over $2.5 billion. We are pleased to announce today that we have signed a new $87 million 16 satellite order with yet another new customer. This award, combined with several other awards we recently signed, brings our total order book to over 30 programs. More to say on this, our pipeline to order conversion year to date is a standout highlight. Turning to our overall performance and quarterly update. I'm happy to announce that our team's positive momentum continues across our Space Development Agency contracts. After our successful delivery last year of our 10 Transport Layer Tranche 0 satellites to our partner, Lockheed Martin, we are very much looking forward to their launch next month. These Tranche 0 satellites will demonstrate the low latency communication link to support the warfighter with a resilient network of integrated capabilities from low Earth orbit. As a reminder, the SDA Transport Layer is a mesh communication network that will use hundreds of low Earth orbiting satellites to connect with other satellite layers, plus critical ground, air, and sea-based systems. As such, the Transport Layer is foundational to the SDA's space architecture for this decade and beyond. We are pleased to contribute to this critical national security mission through work on the first two awards for this layer, known as Tranche 0 and Tranche 1. Our team is hard at work manufacturing SDA Transport Layer Tranche 1. The 42 satellite order, and we are pleased to confirm that we are on track to begin delivery of the first batch of these satellites during 2023 and the balance by the end of the first quarter of 2024. Tranche 1 will be the first operational generation of the Proliferated Warfighter Space Architecture. It's scheduled for deployment by the SDA in late 2024. The Space Development Agency's strategy for construction of this advanced space architecture, which will consist of hundreds of satellites, has been to rapidly acquire and deploy low Earth orbit satellites in tranches every two years. The SDA recently issued a solicitation for Tranche 2 satellites. We expect this award to be announced later this year. We believe our experience and track record with Tranche 0 and Tranche 1 in partnership with Lockheed Martin differentiate us and position us well for additional awards from the Space Development Agency. Many of you are familiar with our relationship with Lockheed Martin. This 7-plus-year strategic partnership was recently extended through 2035, and we continue leveraging the full spectrum of our combined capabilities to support the Space Development Agency. Tranche 2 of the Transport Layer along with the space development layer opportunity remain key pursuits for our team over the next 12 months. Second, we are very pleased to update you on the company's record $2.4 billion contract to design, manufacture, integrate, and test 300 satellites for Rivada Space Networks. As we announced last month, we have received a further milestone payment along with completion of the screening of our industrial partners. This mission will consist of satellites orbiting in low Earth orbit on multiple planes using laser communication terminal. Our initial $2.4 billion contract covers only the first 300 satellites. The contract includes an option for Rivada to purchase an additional 300 satellites at an additional cost. The contract is broadly grouped into a design phase and a build phase. We are currently executing on the design phase, which includes a, quote, demonstrator mission that will support the verification of gateway-less transmission from 1 user to another, routed within a small network of 4 satellites in space. Mission operations for the on-orbit demonstration satellites will be conducted from Terran Orbital's new state-of-the-art satellite operations control center, which is currently under construction in Irvine, California. An additional 25 satellites will be built and commissioned as part of this phase. The build phase will consist of delivering the balance of the 300 satellites in late 2025 and the first half of 2026. We are still ramping this program and recently re-received a milestone payment. Rivada revenues are projected to steadily ramp up in the coming months. We are thrilled to announce today an $87 million award from a new customer for 16 low Earth orbit satellites. We see ourselves not just as a pioneer, but as an industry leader and a supplier of choice, which is validated by our most recent constellation contract awards. Our backlog and pipeline both remain robust as of March 31st, our backlog stood at $2.5 billion, representing orders for over 360 satellites, and our pipeline is $11.8 billion. These March 31 metrics include the successful conversion of the Rivada space contract from pipeline to backlog, but exclude today's announced award. In addition to the programs we noted, we have other active programs, many of which are precursors to larger constellations, both for the existing customers and as well as new and other customers who value our deep mission experience and track record. These missions and others we are pursuing are diverse across customers, channel, and mission. Included today is the prototyping and development of satellites in support of the larger potential constellations. While many of these programs are undisclosed today, they serve the seed as a seed corn for larger potential constellation awards tomorrow. Our announced Lockheed Martin LM LINUSS mission success of two Terran Orbital geosynchronous satellites completing their rendezvous and proximity operations demonstration is just one example of the revolutionary program our team is currently working on. Another is our record-setting NASA Pathfinder Technology Demonstrator 3 satellites, which enable the record 200 Gbps space-to-ground optical link. Low latency, secure communication, proliferated systems, speed to orbit, technology innovation, each of these are customer demands for which we are delivering advances today. Supporting all of these orders and opportunities is our vertically integrated and scaled design and manufacturing capability. We are investing in world-class production systems to support execution of our 360 satellites in backlog and over 2,600 satellites identified in our pipeline. Our new facility, which we call 50-Tech in Irvine, California, adds 50,000 sq ft of floor space and brings our manufacturing capacity of approximately 20 satellites per month once the facility is fully commissioned later this year. Critically, this includes testing equipment, Printed Circuit Board Assembly equipment, and robotic and automated assembly lines to vastly improve throughput, quality, and speed. We are pleased to announce we are progressing with the development of our recently announced 90,000 sq ft facility, also in Irvine, which we expect to increase our capacity to multiples of our current capacity after commissioning in late 2024. Importantly, this new capacity includes 36 ft high bay for assembly and integration of significantly larger satellites. In summary, Terran Orbital has established itself as a leading supplier of the enabling satellite infrastructure of the new space age. Constellations of smaller, low Earth orbiting satellites are the preferred architecture of the future. What used to cost billions and take a decade to launch, Terran Orbital is building at a fraction of the cost in months. Our investments in scale, vertical integration, and automation leverages our 10-year legacy. Our production system is designed to deliver satellites at a mass scale and at a speed and quality our customers desire at a price point to stimulate new markets and at margins to reward our shareholders. We are thrilled our strategy was recognized by the two new franchise contract awards in recent months. Now let me turn it over to Gary to review our financial performance in the quarter and provide a financial outlook for the full year. Gary? Thank you, Marc. Good morning, everyone. I'm happy to report that in the first quarter, we achieved multiple milestones in satellite production, resulting in a record first quarter revenue of $28.2 million for the first quarter of 2023. This is a 115% increase over the same period of the prior year. As a reminder, we recognize revenue on most of our programs on a Percentage of Completion basis, adjustments and changes to our contract values and estimated cost at completions or EACs have a cumulative impact in the period in which we make the adjustment. In the first quarter, adjustments to EACs increased revenues by an estimated $800,000. Gross loss was $1.4 million for the first quarter compared to $2.8 million in the same quarter in 2022. Excluding share-based compensation and depreciation, amortization included in cost of sales, adjusted gross profit in the first quarter was $2.3 million compared to adjusted gross loss of $0.2 million in the same quarter in 2022. EAC adjustments positively impacted adjusted gross profit by an estimated $1.5 million during the first quarter of 2023. Selling, general administrative expenses were $32.5 million in the first quarter of 2023, compared to $30.2 million for the same quarter in 2022. The increase was primarily driven by higher research and development activities, labor and benefits, and other costs as a result of our growth initiatives, offset by decrease in share-based compensation expense. We continue to increase our staff to meet upcoming demand. Share-based compensation is an important part of acquiring and retaining employees. Although down year-over-year, share-based compensation still represented over $10.2 million of our first quarter expenses, with approximately $6.9 million running through our GAAP SG&A expenses and $3.2 million balance reflected in our cost of sales. Subject to future equity program activity, we currently expect share-based expenses to be below $7 million per quarter for the balance of this year. Adjusted EBITDA was - $22.6 million for the quarter, compared with - $14.7 million in the same period in the prior year. The decrease in Adjusted EBITDA was primarily due to an increase in selling, general, and administrative expenses related to higher research and development activities, labor and benefits, and other costs as a result of our growth initiatives, partially offset by an increase in adjusted gross profit. Overall, adjusted EBITDA loss is largely a function of our ramping capabilities across the company to serve our multi-billion dollar backlog and pipeline in the coming quarters and years. This is part of an overall investment in our capabilities that supports our path to profitability, to which we are well-positioned, particularly given the strength in our signed order book. Our backlog at the end of the quarter was $2.5 billion. Capital expenditures for the quarter were $3.2 million. Finally, as of March 31st, we had approximately $57.4 million of cash on hand and approximately $305.3 million in gross debt obligations. Now for outlook. We are very excited about our outlook on the for the coming year. The efficient and successful execution of our new and existing contracts remains the number 1 priority for our team. The exact timing of execution on our new contract work is a primary variable affecting our projected full year 2023 results. These contracts are the building blocks for what we believe will be a substantially higher sales base in 2024. Given our current view of our steep ramp ahead, we anticipate in excess of $250 million in sales in 2023. Upside beyond this level is possible depending on our successful execution of our customer commitments, just as our ability to achieve this target would be impacted by such execution. The timing of our new capacity commissioning and our anticipated schedule of contract milestones will drive our revenues to be weighted towards the second half of this year, particularly in the fourth quarter. We expect gross margins to demonstrate year-over-year improvement, but pace improvements may be variable given timing impacts. Finally, we note that our CapEx for the year is expected to be less than $30 million. I will now turn the call back over to Marc. Well, thank you, Gary. Thank you everyone on the call for your continued support of Terran Orbital. I will now look forward to taking your questions, and I'll turn it over to the Operator. Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask your question, please ensure your device is unmuted locally. First question comes from Ron Epstein from Bank of America. Your line is open. Hey, you actually got Andre on for Ron today. Thanks for taking my question. I wanted to note the CapEx expected spend for the year along with where the cash balance is at now. How are you guys finding the financing environment largely? Could you give a little more context around that? Sure. This is Gary. The financing environment is, we do a little bit of our equipment expenditures on a financing basis, and there are multiple providers of that. I feel very comfortable and confident with that. Generally speaking, from a finance perspective, we look at the company funding to the market in terms of the equity markets. As you know, we have a little under $100 million ELOC in place with B. Riley. We have not tapped into it for the last couple of quarters. That is the primary area by which we look into the market to add additional capital. Overall, this is a tough financing environment, and we're very mindful of it. Perfect. Thank you. Oh. Yeah, I'll keep it at one for now. Oh, yeah, go ahead. Go ahead. No, I wasn't sure if there was a follow-on question. Yeah. He He did ask for CapEx for the year. Oh, yeah. CapEx for the year. If If you could just repeat your question. No, yeah. I was just looking at where your cash balance is at now- Sure ... and then where CapEx is looking to be. I, you know, just obviously and given the comment in the in your release about, you know, continuing to look at prospective financing, you know, beyond this point, I just kinda wanted more color as to how you were finding that and, you know, how you're planning to go about it. Well, thanks. I think that, look, the way we're financing our business is we have substantial growth. As we've mentioned, the back half of the year is gonna be a significantly higher revenue uptick versus the last several quarters. The way Marc and I and the board are looking at our finances is really bridging from this point through our profitability. We have a fair amount of working capital needs and obviously growth needs, and you've seen that in the last several quarters, including the first quarter. We're matching up our financing with our needs. Overall, we're building to a path of profitability both on an EBITDA basis and a free cash flow basis during 2024. Anything we're doing as far as capital is really looking at bridging between now and that period. Sorry. We've been very lucky in terms of, you know, because of the type of contracts that we're getting and the size that we are and how we are a standout in new space. We understand a lot of people in our SPAC, all the SPACs that went out, the majority of them are, you know, data as a service. You know, we're a, you know, purebred manufacturer, so we're in a different kind of business. We have been seeing a lot of attention from a lot of, a number of different financing sources should we choose to go that route. We feel pretty comfortable about our liquidity, pretty comfortable about our options out there and, you know, pretty comfortable about our customer base. Perfect. That's great color. Thanks, guys. I'll hop back in. We now turn to Mike Crawford with B. Riley Securities. Your line is open. Thank you. Three, can you give us some more color on the timing and magnitude of the received milestone payments from Rivada? I think one may have been before the March 31st balance sheet snapshot. Yes. Unfortunately, we can't disclose how much they've paid for each of the two payments they've made to us. We have an NDA with them, and we have to respect that. They wanna be in control of a lot of different things, including their capital sources. Okay. In that regard, it's understood that their capital sources have been disclosed to the ITU, but that public has not been made that filing has not been made public yet. That could be the case at or before this upcoming meeting at the end of June. Is that still your current understanding? Yeah. I believe the meeting is July 2nd. As when I talked to Rivada, They are a private company. They don't have to disclose to the public where their money's coming from. All I can tell you that is public is that second gamut partner in starting this is Peter Thiel. Okay, Marc. Regarding 50-Tech, I think we walked through that facility 11 months ago, and it was near online. You know, I think on your last conference call, you talked about it being online April 1, and now you're talking about full commissioning. Am I correct to understand that there are some satellites that are being assembled in that facility as we speak? No. Everything is currently still being done in the Barranca facility. The local electric company has taken their time in getting our power turned on, and not turned on, but upgraded for the building. We're at their mercy to some extent. A lot of the equipment has been delivered. The PCBA lines have been delivered, but they can't be powered up yet. We're hoping to power everything up starting next month and then go through some testing over the summer. With that being said, that building, the first big set constellation that will be built in that building is SDA's Transport Layer Tranche 1. Everything else is being done in the existing facility. when you talk about... Okay. Let me give more clarity. By August of 2023, we expect that building to be in use, 100% in use. At that time, when you're talking about the capacity of 20 satellites per month, are you talking about Tranche 1 Transport Layer size buses? Correct. could you do That's for. Not two sats. You are 100% correct. This is gonna be all, you know, 450 kg, 500 kg size buses that'll be done there. Okay. All right. Thank you very much. Thank you for coming. Our next question comes from Greg Konrad with Jefferies. Your line is open. Good morning. Good morning. Maybe just to start, I mean, you mentioned screening of industrial partners for Rivada. Can you maybe talk about that a little bit, supply chain readiness and just given that you manufacture a lot in-house, just kind of how you're thinking about that screening that you had mentioned in the script? Sure. We manufacture 85% of the components today that go inside of a bus, and we are working diligently to get to 100% by the end of the year. With the exception of solar panels, which are manufactured by Lockheed Martin. When we say screening industrial partners, we're specifically talking about the payload. The only payloads we manufacture in-house today is synthetic aperture radar and certain kinds of RF radios. For payloads, we go to the outside. We have been screening and choosing with Rivada Networks all the different payload partners who will be part of the constellation and then reviewing their supply chain to ensure that they can get things done on time. On the supply chain issue, I'm gonna mention a lot of conversations we're having now with partners who are having supply chain issues, the number one supply chain issue everybody's having comes with printed circuit board. Printed circuit board assembly has been the biggest problem. By us having two state-of-the-art printed circuit board assembly lines operational by this summer, we'll provide our own supply chain relief as we will be manufacturing components for our supply chain in order for our own satellites and possibly for some of their other customers as well. This is a huge difference in how we do business with our vendors. Maybe just more of an accounting question, but you mentioned the ramp around systems engineering for Rivada. You had some positive EAC in the quarter, and I think you mentioned most revenues are under percentage of completion. When you think about, you know, a large program such as Rivada, is there a difference in profitability between the engineering and when you get to manufacturing, or is that all one program from an accounting profitability perspective? Yeah. We haven't given the precise accounting on it, but, Greg, some of the accounting on a program that large will have a mix of margins in them based on the type of cost. Thank you. I mean, obviously, you know, as you do the larger scale assembly, milestones, you hit, you know, more gross profit dollars will hit. We are cognizant, and we are on our path to getting to EBITDA positive next year. As the assembly and the delivery of these new satellites gets completed, that will have a dramatic impact on our bottom line. Then maybe just one last one. I mean, thinking about the pipeline and the contracts you've announced recently, whether, you know, Rivada or the new one that you announced in the quarter, I mean, are you seeing a drift higher around ASPs per satellite versus, you know, some of those initial awards and kind of what's driving that? You know, it's interesting. Customers are willing to pay more money for faster delivery. We had a time period maybe two years ago, where it was all about price, price. Now we see customers are a little less focused on price. They're becoming much more focused on quality. You've had a lot of people launch what we call bricks in space across the industry, which only benefits us because, you know, everybody thinks it's easy to build a satellite. It's not that easy. Our 10+ years heritage has helped us a lot. We're seeing people focusing on the quality, on the speed of delivery, and slightly less on price. They're obviously are all price conscious, you know, but they want. We try to explain to them it's about value. you know, it's, you can always buy it cheaper, but not everybody wants to drive a like a car. You can always find a, you can always buy a Yugo and drive a cheap car. It doesn't mean you want to. Greg, the other thing I'd say overall is we are entering the phase the last 12, 24 months of really getting into serial builds of constellation versus the prior decade of our existence, where it was a lot of prototyping, co-development. What we're seeing is a price point on a serial build basis, we're able to deliver to the customer a very consistent price point, even with inflation in the overall marketplace. We're starting to lap and get on the other side of some of the more upfront costs, whether it be Non-Recurring Engineering, first article costs. We're really starting to see that flow through. That'll manifest itself on our income statement in our cash flows in coming quarters. I'll be pleased to show that and demonstrate that. Generally speaking, when we're building this, bidding these big contracts, we're able to deliver to the customer a pretty consistent value point for the overall serial build of the constellation. Thank you. As a reminder, if you'd like to ask any further questions, please press star one on your telephone keypad now. We now turn to Erik Rasmussen with Stifel. Your line is open. Yes, thanks, for taking the questions. Maybe back to the outlook, and the revenue. I know you'd mentioned a strong second half ramp, but how would you sort of, you know, weight the first half versus the second half, realizing that Q4 is probably the big point of the year? I mean, Q4 is definitely the big point of the year. I mean, of course, you know, unlike companies that like your mobile, your AT&T Mobility or something where you have, you know, monthly recurring revenues that go on, you know, our revenues tend to be fairly lumpy, most of both molted around module building and the assembly of the satellite. We are growing at such a rapid rate, we still find lumpiness in our quarters, but, you know, at the end of the day, we look for the total revenue for the year is how we look at things. I'll turn it over to Gary, who has the color. Yeah. we've guided to over $250 million for the year. I would just to give you a rough guide point, I'd look at fourth quarter being 4x our first quarter. Okay. That's helpful. Maybe just you mentioned possible upside. What are the factors that could contribute to that upside? You mentioned some gating items, probably around execution or timing. Yeah. Well, we recognize revenue generally by adding value into programs. Value into programs is everything from direct labor and overhead, our internal modules, and then third-party parts and services. As we're able to execute on all three of those, that adds value to the programs, which then generates both cost on the programs, but also generates most of our revenue. If we have programs in the ramp we have, a weak acceleration or a weak delay has a big impact on the month and in the overall quarter. What I'm trying to articulate is, with the type of lift we have in overall execution, you can have variability up and down throughout the months and quarters to come. That's maybe the best and the best glossy way of describing timing on what it means. That's why we've guided to $250 and indicated it, that it could be substantially higher, but also hitting $250 has execution challenges, and it has mostly to do with how we deliver those 3 categories into overall value of the program. We're seeing, you know, you know, we've dramatically expanded our business development group over the past year. We went from a few people to over 30 people in the group. We're seeing that turning into RFIs and RFPs, you know, whereas we would only have, you know, a few out at any given point in time. We are seeing, and again, we are seeing ourselves now with an enormous number of RFIs and RFPs that we've issued in the past few months. You know, we will expect the number of those to turn into new contracts over the next few months. Again, and in addition, you know, we will be bidding on almost all of the SDA work that's coming out going forward. As a Transport Layer, you know, Alpha, Beta, and Gamma, we will be bidding all 3 of those. We are looking at bidding on the Tracking Layer. We are doing this with our partner, Lockheed Martin. We're thrilled to be doing it with them. You know, we have the May 11th solicitation for 100 Alpha satellites, and that follows the early request for 72 satellites for their Beta solicitation. The regular Transport Layer into different pieces now. We feel that we have performed fabulously so far, and they want the SDA to quote, "Those who deliver are those who keep winning." We have delivered. We delivered the first Tranche 0 ahead of schedule, and we delivered them gifts throughout Christmas morning. It's those of you who've seen the meme out there. We will continue to. More importantly, our business development group is expanding, and we are sending out more and more RFPs. As we expand our manufacturing footprint, we're getting more and more interest from people to build larger and larger constellations and larger and larger satellites. These have all been positive data points and metrics in the development of our business. We feel pretty confident so far. Great. Maybe just on the margins, you expect sort of improvements. Would you expect both GAAP and adjusted gross margin to be positive in Q2? Then obviously for the year, you'll see that trend throughout. Just remind us what the targets are for maybe gross and operating margin. We see margins continuing to improve. You know, what's happening here is that we're so small. You know, as we hire up a bulk of people for Rivada, for this new customer, and others that we believe that we will be getting, it has, does have a negative impact on our financials. We have to hire people some 16, some 6 months ahead of program to get them up to speed, and you're building facilities almost 18 months ahead of program. Eventually, things will start to level off. I'll let Gary give you some more color. Yeah, I think we generally see ourselves ramping to the high teens throughout this year, mid-twenties the prior year, and then as much as 25%-30% in the outer years. Part of that's gonna be, part of that's just gonna be the mix of the programs that we're working on. A lot of the programs we're working on now, and old backlog have a lower margin base, and the new programs have a slightly higher base. Great. Maybe just my last one. On the new award, the 16 satellites, you know, maybe any additional color on this award. The deal, you know, suggests, and I think we were talking a little bit about ASP earlier, but it's about $5.5 million per satellite. That's sort of in between the Rivada and the SDA. Maybe just, you know, comment on the timing of when these satellites will be delivered. Thanks. You know, as a, you know, we deal with some customers who have more confidentiality than others. At the customer's request, we're not allowed to give out any more information other than that. Okay, great. Thank you. We now turn to Robert Spingarn with Melius Research. Your line is open. Hey, everybody. Hey there. Marc or Gary, as you build out this $250 million+ in revenue this year, what programs should we think are driving that? I assume Tranche 1 is a big piece of that. It's not clear if Rivada is or not or any of this other stuff. How do we think about the $250 from a program support perspective? I mean, Tranche 1 is a big part of it. You have Rivada right after that, and you have this new customer and, you know, and there's some other things coming down the pipe. You know, Tranche 1 is by far the largest part. That component, we're gonna deliver, you know, call it 2/3 of Tranche 1, in calendar year 2020 to 2023. In the overall backlog is that we're at, like, 30 programs. While there might be some onesies and twosies in there's some other programs that are confidential we haven't mentioned, but they contribute in aggregate to the overall numbers. I concur with what Marc's saying, but there's a mix of deliveries this year. You know, keep in mind that most of the orders we get, we're turning around in two years. Rivada's a little bit of outlier, albeit it's 300 satellites, call it, over three years. Okay. I just wanted to think about the backlog a little bit. I mean, the backlog is obviously highly weighted towards the Rivada order. You got $2.5 billion in backlog, $2.4 billion of that is Rivada. Kind of suggests that the 60 non-Rivada satellites are $100 million in backlog, but I'm not sure that reconciles with the you know, with that, Tracking One and the other stuff you're doing. Is there a better way to think about this? I think with what we've disclosed, is we started the year about $170 million backlog before we included Rivada. We did, you know, roughly $29 million-$28 million in the first quarter. That might help you get to kind of a pro forma of the January 1 backlog. I think that'll help you. Right Spin around on that. Just with that, we're not. Right. The $87 million. We're not doing. Sorry. We're not doing Tracking One. You said Tracking One. We actually didn't bid on Tracking One, which we strategically chose not to. Oh, I'm sorry. Transport. Oh, fine. Okay. Just want to make sure- Transport We're clear what I'm doing. Got it. Yeah, right. You understood what I was getting at. Is the 87 in there or where, or is that post, March 31? That's not in there. All the numbers we've given include the conversion of Rivada into backlog as of March 31, but the newly announced deal today is not in the numbers. Okay. Then the other thing I wanted to ask you, Marc, as we think about future opportunities, you know, beyond what we've already talked about today, where are some of the other opportunities outside of these two or three contracts that we focused on today? Some of these opportunities are, you know, SDA, you know, they've seven new bids going out. you know, the three starting with the new, the three new Transport Layer bids we're bidding on, we're gonna bid on Tracking and possibly some others. you know, that's just one small part of a very, very big pot. The other thing I'll add is in an overall area is there's a lot of positive feedback loop in the marketplace. As we add and complete existing programs and add more programs, there's a feedback loop within the marketplace where other customers are looking to us to leverage off of that experience and that track record to produce programs for them. In the last 6 months in particular, but, you know, maybe even 18 months, our track record is really allowing us to get in and have good purchase with new constellations, both on the civil, but on the government side as well on the commercial side. Okay. The only other thing I was gonna ask, Marc, is as you get through your capacity ramp, I wanted to clarify when the most significant milestones are. Is it the end of 2024 when you have most of your capacity in place? You know, what's the revenue capacity at whatever that milestone is? You know, it's, you know, capacity is a never-ending thing, I'm hoping. Being an optimist, we would say it's never-ending. There's, you know, always that capacity. You know, we are looking at, you know, we have 20 buses here and 50-Tech, as we call it. We are with the new facility that on, which is on Goodyear, like 4 Goodyear, you know, that allows us to get into the $1 billion revenue category. More importantly, that new facility not only allows us to build buses but build full satellites. We can do the payload, we can do the solar panel assembly, we can do everything under one roof, which is a big game changer for us. We can do payloads on small satellites, like 12U and stuff like that, but we couldn't do the payload, for example, on a T-Zero in the existing Barranca facility. That facility really takes us to the next level. We will build Rivada in that facility, so that'll only take up about a third of the facility. We have two-thirds available for other customers who we're talking to today. Right. Is there a good rule of thumb for what the ASP, alley ASP changes when you add in payloads? You know, it all depends on the satellite. You know, you could build a, you know, I mean, thing is, Starlink builds these satellites for $300,000, you know, with a very high failure rate, but it's testable. Every customer is different. We're building satellites. I think our largest we have right now is 800 kg that we're building. The way we viewed it, as long as it fits on an S-ring or ESPA Grande, we'll build it. That's kind of. We are, you know, the satellites are getting larger and larger. They, we went over time. People want it smaller, they want it cheaper. We all started with a CubeSat. CubeSat changed it all. When we went, when we took a CubeSat and we started making it bigger, showed people we could take three CubeSats and put them together, what we call the 3U. It was a 6U, with six of them together. They started getting bigger. What's happened is they went from demonstrators to people really wanting more power. They need more batteries. They want larger solar arrays. Now you went from, you know, trying 0 to 350 kg to trying to run 450 kilograms. Now we see new ones coming in the 500 to 600 kg range. You know, people want more power. It's just they're seeing it no longer as demonstrators, but a fully functioning replacement for geosynchronous satellites that can be built and launched with current technology. Yes, there's a replacement cycle, so it's a recurring revenue business. Every satellite we built now for a constellation has to be replaced every five years. That's still phenomenally cheaper than building it in geosynchronous orbit. It allows them to continue to upgrade their technology, just like the SDA does with each Tranche. Continues to update the technology on each satellite. Our business can become a recurring revenue business down the road, but you're talking, you know, that's only a few years out. Right. Right. Thanks for all the help. Thank you. We now turn to Greg Konrad from Jefferies. Your line is open. Good morning, gentlemen. This is my first time on one of your calls. We just recently initiated coverage as a buy in this price range for Terran Orbital. Obviously, we see superb prospects and congratulate you on what you've achieved so far. I do have a question, speaking of business development, as to cross-ownership in the small world of space between AE Industrial, Bain Capital, and whether or not you expect some of this to come together over time, whether it be the Australian programs, Crescent and so on or that's Lockheed, or whether or not you're gonna be involved with constellation space management, such as BigBear.ai is doing or anything like that. Could you expand a little bit more on whether or not you're going to be limited to manufacturing? Well, we are not limited to anything. We can do anything that we wanna do, anything that our customers want. You know, we do see, you know, we do expect there'll be a continued consolidation in the space. You saw Millennium got acquired by Boeing, Blue Canyon got acquired by Raytheon, York got acquired by AE. We'll continue to see consolidation in the space, you know, we could, if we chose, could expand beyond satellites and do other space-based initiatives or ground-based initiatives for that matter, as we do own a ground station network, and we do mission operations. You know, you know, we could even get into AI. You know, that is something we've been talking about a lot here, and we'll have more on that later on this year. Well, I'm glad I brought that up. Thank you, Marc. Also, my only other question, 'cause so many have been asked, is many of the older shareholders come back from the SPAC days or from Beach Point or from, what they call Tyvak, the original CubeSat designers, and they still have a lot of shares. How do you work through, or could you and/or Lockheed eliminate that concern among shareholders and therefore eliminate overhead supply in one fell swoop? The reality is you have, you know, I mean, you know, as you talked about, the original investors are people like myself who aren't going anywhere. You have people like myself, you have Marc o Villa, you see myself, Marc o Villa, Lockheed Martin, and maybe a handful of others. We're 50% of the company. We don't see any, you know, you've one or two former employees who own a few million shares. They can do, you know, those who have made the mistake have chose to sell, that's their choice. We all believe in the company, and we're sticking around. Great. I appreciate it. I really like the Lockheed association, and given the suppressed share price, I'm hopeful that they do not acquire you. I think they won't for competitive or monopolistic purposes anyway. I should ask whether or not that allows you to maintain adequate profit margins or they have a leverage in negotiating that makes it hard for you to make money on the 11 or 12 programs you have going on with Lockheed. Lockheed has been an incredible partner, and they, more than anybody else, would like us to become profitable as soon as possible, and they've made that very clear. We are working as quickly as possible. They are aligned with the shareholders. Being a large shareholder, they wanna see profitability, and they wanna see the stock go to where it needs to go and not be where it's at now. They have been a big supporter of us to get to profitability as soon as possible. Great. I am looking forward to that as well. Congratulations, and, we'll see you another time. Thank you very much. Our next question comes from James Byrne from Piper Sandler. Your line is open. Questions were answered while I was in the queue. My only, I guess, comment is that I was a bit alarmed that, you know, your sales doubled year-over-year, and you weren't able to leverage any of your fixed costs so that into the operating margin line. I know you're doing a lot of hiring ahead of time, but what I, like I said, what I get concerned about is, you know, look at the statement of cash flow, and if I do a very quick analysis, you're gonna run into a cash crunch in about six months. The other thing, going back to the cost of sales, what it tells me is that since it didn't look like you were able to leverage any of your fixed costs, your variable costs are growing faster than your sales are, which does worry me a bit. It's just a comment 'cause I've been through a number of startups before, and I've seen this kind of thing happen. Right now, your stock in the market is about down about 8.5%, 9%, so I think other people are concerned about this too. I mean, I heard a lot of the commentary. I just hope that this can turn quickly so that, you know, if you're gonna burn through cash, you've got to get it from somewhere, and it's gonna be really hard to raise it in the open market given where your stock price is right now. I'm in a different camp than a few other people I heard on there. I'm just, I'm a little concerned about what I see, that's all. I mean, we are an experienced management team. I mean, this is my, between my partner Dan and I, this is the seventeenth company we've taken public. We've raised over $20 billion of equity and $100 billion of debt over the course of our careers, combined. We understand the capital markets. We understand how to grow a business from scratch. This will hopefully be between the two of us, our seventh unicorn. We are very much, you know, aligned with you. We understand, you know, unfortunately, sitting where I sit, I see things differently, because we have a lot of information of where we're going and how we're getting there. We've had to go ahead and make sure, you know, We started as a very, you know, for years, we were a tiny little company that built two sats. I took over CEO a little over two and a half years ago, and we decided at that point to partner with Lockheed Martin, and we are growing at a rapid pace. Yes, we are spending money. We have a $100 million ELOC that Gary mentioned, I think, it would be Riley. You know, we have lots of options in the capital market, but we're gonna be smart as we move forward. The last thing we wanna do is, you know, we're trying to be smart as we raise capital, as we do, but at least our equipment out. Eventually, you'll see very quickly as these new facilities come online and these new programs start filling, that things turn very quickly in terms of revenues, in terms of profitability, in terms of cash. Gary, you wanna add more? No, I'd say if you think about what we're looking at with the $2.5 billion backlog, the facilities, the labor, the process, the automation, all that's built in to feed into that. It's hard to describe the difference between the lines in our income statement that are fixed and variable. A lot of the labor, a lot of the SG&A you're seeing is the precursor to be able to deliver in value to the programs. You'll see numbers that show up in SG&A and moving into the COG line as new labor, for instance, comes online and has been here. If you have a new hire that's been here for one or two months, they're not gonna be contributing to the program side of things for at least six months. You'll see things moving up the income statement into the COG line, and then from the COG line into revenue, and then ultimately on margin. Think of it in terms of building a business that's looking to generate $1 billion a year of revenue, and that'll kind of give you a perspective on how we're trying to stand up the company as far as cost now versus performance later. I understand everything you're telling me. I've been a part of three startups. Unfortunately, all three of them went bankrupt. I've also been a part of a number of smaller companies that have gone through exactly what you're going through. They were in different businesses, it could be different. We tried to make sure as we ramped up, I mean, if we had sales double year-over-year, we were trying to make sure we leveraged some of the fixed costs as we went along. I, you know, I haven't done 17, I've certainly done a number of companies and I've seen some work and some not. I just, like I said, when I saw this income statement, I went, you know, I was a little bit concerned. Anyway, I heard what you said, so I'll just keep watching. Thank you. All right. Thank you for coming. We have a follow-up question from Mike Crawford with B. Riley Securities. Your line is open. Thank you. A little follow-up towards the comment about integrating full payloads and solar panels, in addition to buses in the new facility. In that regard, can you remind us, like, how proprietary you think your own potential synthetic aperture radar payload solutions might be versus others? If you could comment on likelihood or number of conversations of any of these resonating with potential customers that contract with you to build something like that for them? Our SAR panels specifically are incredibly exquisite. They were built originally for the Missile Defense Agency on what was a classified program that got declassified by Georgia Tech Research Institute. It was paid for by your taxpayer dollars. We thank you for that. It is an absolutely exquisite antenna. We are that being said, you know, most of the customers we are talking to about that are a lot of government customers, I can't go into the details of who we're talking to about it. It is a very unique American-made, which is important, program. I can leave it there. All right. Thank you, Marc. Our next question comes from Austin Moeller from Truist Securities. Your line is open. Hi. Thank you for taking my question. I was wondering about Rivada's waiver that's coming up for your September 2023 delivery. You'd have to ask Rivada. I mean, we know everything you know about the IT. Well, we have no information other than what is publicly filed. Fair enough. Thank you. Thank you. Our final question comes from Christopher Frost, a private investor. Your line is open. This question is from Marc. I have, you stated that you have to replace, satellites get replaced every 5 years, and I'm wondering with the current amount of satellites you produce, can you keep that flow going? Well, that is the reason. It was a good question, and that is the reason why we announced that new facility. The one that's under construction right now will help us, so we can continue to build and keep up with that demand. Now, my other question is, this Merritt Island, is that still a go with- That was killed by a bald eagle almost over a year ago, sadly. Okay. Thank you. Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.