Astra Space, Inc. (NASDAQ:ASTR) Q2 2022 Earnings Conference Call August 4, 2022 4:30 PM ET
Company Participants
Andrew Hsiung – VP of Strategic Finance and Capital Markets
Chris Kemp – Founder, Chairman, and CEO
Kelyn Brannon – CFO
Benjamin Lyon – Chief Engineer and EVP, Engineering and Operations
Conference Call Participants
Edison Yu – Deutsche Bank
Andre Madrid – Bank of America
Operator
Good afternoon. And welcome to Astra’s Second Quarter 2022 Earnings Conference Call. [Operator Instructions]
I would now like to turn the call over to Andrew Hsiung, Vice President of Strategic Finance and Capital Markets for introductory remarks. Please go ahead, Andrew.
Andrew Hsiung
Thank you, Operator. Good afternoon, everyone. And thank you for joining us for Astra’s second quarter 2022 quarterly results call. After the market closed, we released our financial results. The results release is available on the SEC’s website and our Investor Relations website at investor.astra.com. This teleconference is also being broadcast over the Internet and will be archived and available on our Investor Relations website.
During our call today, we will reference non-GAAP financial measures, which we believe to be useful to investors as our management team uses these non-GAAP financial measures to plan, monitor and evaluate our financial performance. These non-GAAP financial measures exclude certain items and should not be considered as substitute for comparable GAAP financial measures. Astra’s methods of computing these non-GAAP financial measures may differ from similar non-GAAP financial measures used by other companies. A description of these items along with the reconciliation of our non-GAAP financial measures to their most comparable GAAP financial measures can be found in our release.
Today’s call will also contain forward-looking statements. These forward statements refer to future events, including Astra’s future financial outlook. When used in this call, the words anticipate, could, enable, estimate, intend, expect, believe, potential, will, should, project and similar expressions as they relate to Astra are, as such, a forward-looking statement. These forward-looking statements are subject to a number of risks and uncertainties. And as result, Astra’s actual future results and performance may differ materially from those discussed in this call. We encourage you to review our filings with the SEC in which we describe the factors that could cause actual results to differ materially from our current expectations, including those updated risk factors included in our quarterly report on Form 10-Q.
We also refer to commercial launches during this call. When we use the phrases commercial launch, commercial revenue launch or commercial orbital launch, we mean a launch conducted under an FAA commercial launch license. Our commercial launches may be paid or unpaid.
Finally, I would like to remind everybody that this call will be recorded and will also be made available for replay via link available on the Investor Relations section of our website.
With that, I’d now like to turn the call over to Chris Kemp, Astra’s Founder, Chairman and Chief Executive Officer. Chris?
Chris Kemp
Thank you, Andrew. Good afternoon, everyone. And thank you for joining us today.
Today in addition to my Co-Founder and our CTO, Dr. Adam London, and our Chief Financial Officer, Kelyn Brannon, I’ve asked Benjamin Lyon, our Chief Engineer and Executive Vice President of Engineering and Operations to join us today to share some additional details about the progress we’re making on the new version of our Launch System.
Our mission improving life on Earth from space continues to inspire our team to relentlessly push forward learning, growing and pioneering the rapidly growing commercial space industry. Even with the headwinds we have experienced in the market, it remains more clear than ever that we can expect space products and services to unlock tremendous societal and economic value as we believe that investments made by the U.S. government and other large commercial companies will continue to drive growth in the space tech industry. The long term focus that guides our strategy, product roadmaps and investments remains unchanged.
Before I dive in, I’d like to start with a few words on the macro environment. We’re in a period of global uncertainty driven by geopolitical tensions, supply chain constraints, and elevated inflation. Yet in the midst of all this, we see space as a bright spot. The global space economy, currently estimated at 469 billion by the Space Foundation grew 9% last year. We remain focused on ensuring Astra is positioned to seize this opportunity to become an end-to-end provider of space products and services.
Reflecting on the last year as a public company, in addition to building out a world class team and systems to operate as a public company, and tripling the size of our increasingly diverse workforce, Astra has acquired Apollo Fusion and launched and started shipping our first space product Astra Spacecraft Engine, completed the expansion of our quarter million square foot rocket factory, new test facilities and established a new spaceport in Cape Canaveral, Florida. We’re also working with this Oxford U.K. spaceport to evaluate an opportunity to launch in the U.K. This opportunity is subject to the entry into definitive agreements and regulatory approval before we can launch.
Astra has recruited dedicated teams to support concurrent, R&Ds, tests, manufacturing and launch operations, including new VP to run launch operations [Doug Koosman]. We’ve started development of Launch System 2.0 with the largest and most talented engineering team we’ve ever assembled. And we’ve done all this while conducting four commercial orbital launches of Launch System 1.0, two of them successful, two of them unsuccessful.
And it is this last point that our leadership team has taken to heart this last quarter. And we’ve never been more rigorous in our analysis or more focused on making the changes necessary to ensure Astra delivers a service that is reliable, cost effective and meets the needs of our customers. So we’ll spend the majority of today’s call discussing this focus.
So turning to this quarter. It’s been a quarter of continued investment, customer adoption of our space technology products and growth in our customer pipeline. But on June 12, when we launched the first of three intended NASA TROPICS missions from Cape Canaveral, we failed to deliver NASA’s payload to orbit. We’re going to spend a bit more time on this in a moment.
Second, given the increasing demand from large constellation operators for higher capacity, lower cost and more reliable launch services, our discussions with NASA and other customers and the significant resources that have been required to support launching our 1.0 system, we’ve made a few key decisions.
First, we’ve increased the payload capacity target for Launch System 2.0 from 300 kilograms to 600 kilograms. Second, we’re working with all of our launch service customers to remanifest and launch this in 2.0. Thus, we will not have any additional flights in 2022.
And third, we’re increasing investments in testing and qualification, which will add additional time and test flight to our scheduled prior to resuming commercial launch operations, meaning that whether we’ll be able to commence commercial launches in 2023 will depend on the success of our test flight. We’ll spend more time on this in a moment as well.
And third, in area of space products, it’s been just over a year since our acquisition of Apollo Fusion and demand continues to increase for the Astra Spacecraft Engine. By the end of the second quarter, we received a total of 103 committed orders for Spacecraft Engine up 69% since the end of last quarter. And today, we’re also announcing that we’ve secured a lease for an additional 60,000 square foot facility to support the production of the Astra Spacecraft Engine, which we believe will become the industry standard in space propulsion.
For our financials, we ended the quarter with approximately 200 million in cash and cash equivalents and marketable securities. We’ve honed our operating plan to live within our means and focus our human and capital resources to bring a more reliable and higher capacity launch service to market and develop and grow our space products business. We’ve entered into a $100 million committed equity facility with B. Riley Capital, which provides us improved financial flexibility as we continue to develop and Launch System 2, and our space products and services. Kelyn will provide additional detail on our plan in a few minutes.
On TROPICS, as I mentioned on June 12, we launched the NASA TROPICS 1 from Cape Canaveral. The investigation into the anomaly continues and we expect to share findings once the root cause has been determined. However, we do know several things. First, we had a nominal first stage flight followed by a nominal main engine car.
Second, we had a nominal fairing and stage separation. And third, during every stage twice, the upper stage experienced anomaly that caused the upper stage engine to run out of fuel and shut down before reaching the velocity required to deliver NASA’s payload to orbit. To be clear, we are deeply disappointed by this outcome. We’ve been working closely with NASA and the FAA to investigate the failure. And we will share all of our findings once the investigation is concluded.
Furthermore, we’re in discussion with NASA to proceed with TROPICS and launch this in 2.0. On behalf of the entire team, I want to thank NASA for their continued partnership so we remain committed to successfully completing this mission.
Now turning to Launch System 2.0. As I mentioned before, Astra has now concluded four commercial orbital launches for our customers. Two of them were successful delivering a total of 23 satellites to orbit, two were not. Space is a tough business and we tackle some of the hardest engineering challenges and with our achievements have also come failures. Those have taught us a great deal. And us isn’t the us that we were when we took the company public just over a year ago. Since our first successful flight under the leadership of Benjamin Lyon, Astra’s Chief Engineer and Executive Vice President of Engineering and Operations, Astra has more than tripled the size of its development team, completed the build out of a new rocket factory facility, new test facilities and it made significant progress in the development of Launch System 2.0.
Since we unveiled Launch System 2.0 at our Space Tech Day, we have increased the design point to deliver up to 600 kilograms to meet inclination low Earth orbit over the course of the lifecycle, which we believe will allow us to serve over 75% of the total addressable market of small satellites, including many mega constellations.
Finally, we continue to target a base bulk launch price for dedicated launches under $5 million. To provide additional detail on the development of this system, I’d like you to hear directly from Benjamin. Benjamin?
Benjamin Lyon
Thank you, Chris.
As Chris mentioned, since I joined Astra, we’ve made significant investments in our engineering and operations. Now we are focused on taking all of our talent, our manufacturing and test facilities and the time required to do two things, develop the next release of the Launch System, and expand the production and test of our Astra Spacecraft Engines.
The team has been diligently working on the Launch System 2.0 design, or to this effort, our key capabilities that we’ve built out over the last year. For example, establishing dedicated mission management and assurance teams, investing in state-of-the art metrology, failure analysis and reliability labs, developing installing and commissioning new automated assembly equipment on our new Rocket 4 production and Teflon.
For example, we’ve installed automated tank section welding and stacking systems that are central to our development work and future scale. And we baseline the laser weld processes for sub assembly attachments, like baffles and brackets. We’ve also developed a scalable dome forming process that reduces fabrication time, we can now make many rocket board domes and the time it took us to make a single rocket three dome.
We completed a number of engine hot fires at our new castle test facility, enabling us to tune the operation of our higher thrust first stage engine. Lastly, we continue to introduce new analysis processes, documentation systems, and procedures that align engineering, manufacturing and operations to enable quality and reliability at scale. These are important milestones in our development process.
Thank you. And now I’ll turn it over to Chris to provide additional detail on Astra Spacecraft Engines.
Chris Kemp
Thanks, Benjamin.
As we discussed in our shareholder letter in our 2021 annual report, while building a scalable and profitable launch services business is very strategic to Astra. Launch is just one of the three pillars of our strategy. So I wanted to take a few minutes to highlight the progress we’re making in our space products business, where we are seeking to leverage our launch and manufacturing capabilities to develop and productize key technologies needed by our customers to build next generation satellites and space services.
As I mentioned earlier to accelerate our space products business, we completed the acquisition of Apollo Fusion just over a year ago. Our team identified the most significant investments that our customers were making, as they developed space services outside of launch, and satellite propulsion was one of the most sizeable costs. Space propulsion systems are one of the first decision satellite manufacturers make before determining launch options. And in space propulsion is often used in concert with launch to position satellites into their final orbits.
Since we completed the acquisition of Apollo Fusion, we successfully ignited the engine in space on our very first attempts. We’ve since performed hundreds of successful missions. We’ve demonstrated industry leading performance that exceeded the expectations that we set on ground tests. We’re scaling engine production, and we’ve qualified our engine to use [Krypton] and our leading competitor was Russian, and is now sanctioned. We continue to see strong demand. And as I mentioned, we’ve sold 103 spacecraft engines through Q2.
This demonstrates that we can privatize core space products in evidence of our successful post-acquisition integration of Apollo Fusion. We recently signed a new lease for a 60,000 square foot facility to increase our spacecraft engine production capabilities. We continue to evaluate new space product opportunities based on feedback from customers, so more to come on this in the future.
Now I’ll turn things over to Kelyn to review our financials and guidance, Kelyn?
Kelyn Brannon
Thank you, Chris and good afternoon everyone. Let me first review our Q2 results. As Chris mentioned, we continue to see increased customer adoption of our space products and are pleased with the gross margin associated with that business. As a reminder, all our revenue financial figures I will discuss today are adjusted unless I state them as a GAAP measure. You’ll find a reconciliation from GAAP to non-GAAP results in today’s press release.
Revenues in Q2 were $2.7 million with approximately $2 million derived from launch services and $0.7 million from space products as we commence delivery of our first Astra spacecraft engine customers, cost of revenues were $17.4 million for the three months ended June 30, 2022. This includes $4.1 million of cost of launch services and space products and $13.3 million of inventory write-downs $10.2 million of which was attributed to inventory write-downs related to the discontinuation of Launch System 1.0.
Second quarter adjusted net loss was $53 million. Q2 adjusted EBITDA was a loss of $48.4 million well below the low end of our guidance range of a loss of $58 million. On a GAAP basis, our second quarter net loss was $82.3 million. The sequential decrease in net loss was primarily related to a decline in loss on change in fair value of contingent consideration and partially offset by increased inventory write-downs.
Second quarter additions for capital expenditures was $12.9 million and primarily related to finalizing the expansion of our Alameda manufacturing facility. We now fully occupied the entire facility have begun installing production equipment for rocket manufacturing. We ended the quarter with cash, cash equivalents and marketable securities of $200.7 million and no debt outstanding.
The company expects that its sources of liquidity will be sufficient to fund operating and capital expenditure requirements through at least 12 months from the date of issuance of these financial statements. On August 2, after entered into a $100 million committed equity facilitate with B. Riley Principal Capital LLC, the facility provides Astra the rights, but not the obligation to issue up to $100 million of Class A common stock over 24 months to be acquired by B. Riley.
The facility provides increased financial flexibility, as Astra continues to steal, manufacturing, invest in R&D, and deliver launch services and space products to customers. Any activity by Astra under this facility will be done systematically and opportunistically as we progress against our refreshed operating plan. In addition to the B. Riley facility, we continue to evaluate various financial strategies and the overall capital markets as we carefully manage our financial profile. Next, I’ll provide an outlook for third quarter ending September 30 2022.
Our third quarter guidance and the remainder of 2022 and 2023 is subject to various important cautionary factors referenced in the section entitled forward-looking statements below and our Form 10-K, 10-K including risks and uncertainties associated with ongoing COVID-19 pandemic and the decision to discontinue the production of launch vehicles supported by our launch system 1.0.
As Chris mentioned, there’s also a risk associated with elevated levels of inflation and our supply chain when it comes to a dynamic shared across many companies and industries. However, we believe our investments in our factory and vertically integrated manufacturing processes are one of the factors that helped mitigate this risk.
For the third quarter, we currently expect adjusted EBITDA loss to be between $45 million and $51 million. Depreciation and amortization to be between $5.5 million and $6.5 million, stock-based compensation to be between $12 million and $15 million, cash taxes are forecasted to be zero, basic shares outstanding to be between $266 million and $270 million shares and capital additions to be between $6m and $8 million.
Let me provide some additional color on guidance through 2023. As noted earlier, we’ve discontinued the production of launch vehicles supported by our current launch system. And we have focused all of our launch services resources towards the development of Launch System 2.0. As such, we do not plan to conduct any further commercial launches in 2022.
As part of the development cycle for our new launch system, we expect to conduct test launches of our new launch system in 2023, but are not yet certain whether we’ll be able to conduct paid commercial launches in 2023 using this new launch system. We also expect continued adoption of our space products business, and to continue focusing resources on executing on this part of the strategy.
Therefore, you will see a significant reduction in capital – expenditures and slowing growth in headcount as we move through the second half of 2022 and 2023. Capital expenditures will be required for our spacecraft engine facility, additional production equipment for Launch System 2.0 production and launcher upgrades for the new Launch System 2.0 in 2022, after which we expect it to flatten out in 2023.
Although after spacecraft engine you should expect orderly variability in shipments until we ramp production by mid-2023. Please note that the ASP for our spacecraft engine are much lower than launch services, but we’ll have a higher volume with positive gross margin. We continue to expect calendar 2022 to be a transformative year as Astra continues expanding on our product roadmap and scaling production.
As Chris outlined, we will focus all launch resources on Rocket 4.0, our Launch System 2.0, which we unveiled on May 12, at the Astra Spacetech Day, and we will also expand our space product offerings led by Astra spacecraft engine. Lastly, we will continue to focus on ensuring these investments deliver value to our shareholders and set us on the path for long-term success.
Additionally, during the current quarter, we will provide some specifics related to the non-financial operating metrics, which we will be using to measure our progress towards achieving the strategic objectives previously mentioned. This will allow you to understand the progress we are making towards developing on system 2.0 and our increased capacity for building and delivering our space products.
To confirm we intend to achieve these milestones within the financial guidance previously provided. Before I turn the call back over to Chris, I want to add thanks to our entire Astra team and growing roster of customers who trust us to deliver for them. Chris?
Chris Kemp
Thanks Kelyn. In addition to sharing the operating metrics you just mentioned, I’m looking forward to sharing the milestones along the path to our next flights. So in summary, our progress over the next year will be measured by progress towards Launch System 2.0, orders and shipments of our space products including Astra spacecraft engine, and the disciplined execution of our operating plan.
With that, could you please open the call for questions.
Question-and-Answer Session
Operator
[Operator Instructions] Your first question comes from the line of Edison Yu of Deutsche Bank.
Edison Yu
Thanks for taking the question. Have a couple. So to start off, it seems as if the transition to Rocket 4 is going to take meaningfully longer than what the previous outlook may have been. First of all, is that the case and if so what is kind of driving that longer transition time to Rocket 4?
Chris Kemp
Yes, I’ll take I’ll take the first part of that. I think there’s, two things. I think that as we learned more about operating Rocket 3.3 with Launch System 1.1, as we built out this incredible team we built as we continued to build out our new factory. The market continued to evolve as well. And the feedback we were getting from some of the larger constellation operators was the satellites were getting larger. And so we saw really two things happening.
One, an incredible team that we’ve assembled, making a lot of great progress. And frankly, a lot of changes to the new rocket and the new launch system and all the software that powers it and investing in all these new test – new test equipment and labs. And we were investing a lot of that in the new rocket and continuing to operate Launch System 1.1 or 1.0, with the existing rocket, was operating a rocket that threw 50 kilograms to our orbit.
We felt we had an opportunity to do two things, really focus all of our resources and energy on a rocket that, frankly, had the benefit of all the people we brought in this year. And secondly, we had an opportunity to further increase the capacity of the vehicle with an upgrade to the upper stage engine.
And so, the combination of those factors, and also our desire to really build the highest quality, most reliable product that met the needs of the majority of the market, chatted with Benjamin and I asked Benjamin, you know, what’s the one thing we could do to allow you to focus our resources to make that happen not only as fast as possible, but with all the focus and energy that it requires.
And then we started talking to our customers. And it was pretty clear that after two out of the four flights that we had flown, we’re not successful, the opportunity to fly on a vehicle that has received all of this attention, and energy from our team over the past year, was also favorable to them.
And in the end, we kind of did what our customers wanted us to do, which is to focus all of our energy on a system that takes advantage of all of the investments that we’ve made since we took the company with public capital, people, facilities and otherwise. And we did that – very soon after this last flight, frankly, so we could we could kind of get everyone focused on the next system as soon as possible.
Edison Yu
Thanks, and I guess taking that into context. I know you said you’re not flying anything for the rest of this year? What sort of rough targets? Can you share with us because I think – I don’t want you know, drill you down to a certain month or necessary date, but is there some like rough target to test, it is the first test fly. And then if that goes successfully, the first commercial launch is there something you can share with us?
Chris Kemp
I think what I’ll share is, as you look at 2023. What we’re what we’re looking at in terms of revenue forecasts will largely be spacecraft engines. In 2023, I want to give Benjamin the time and the team the time to really get this right. And do the work that is required to build the highest quality, most reliable. So we want to do several test flights, we want to test every component of the system, we want to test the engines, we want to test the stages, we want to test the software, we want to test the electronic.
And really, as we looked at this thing, we built a plan that we believe gives them more time, and also fits the needs of the customers that we can put on manifests as we talked to all of our customers. So there’s a lot of uncertainty because we want to give the time to the team to do all that testing before we do another commercial launch. So I think what we’ve decided is let’s just – focus on giving the team the time to accomplish these milestones. And then we’re going to share all these milestones with all of you as we accomplish them.
So with each of these, these major milestones, you’re going to see Astra give everybody an update, here’s what we’ve accomplished. Here’s what’s next. We’ve accomplished that one. Here’s what’s next. Then there’ll be some test flights. And I think that as we as we continue to do this, we’ll continue to get closer to an answer to your question.
Edison Yu
Understood, last one from me, you said you’re still going to stick I think with the sub 5 million pricing, given that there is so much demand, given that it could be a bit of a crunch. Post Russia/Ukraine, everything, why not charge more? It seems as if there’s actually pretty decent pricing power, you have inflation, base x-rays price earlier this year, why not you know, try to actually charge more and make that economical a bit easier?
Chris Kemp
It’s a great question. I think at a higher price point. It’s a different product. So we’re really we’re not building this service for one-off launches for a couple of small sats here and there. And I think there is a market for that. And I think that you’ve seen some of our peers focus on that market with expensive launches that are infrequently performed for this segment of the market. The market that we’re really excited about Edison is the mega constellations.
And in order to win contracts with the larger constellation operators, the economics that we’re competing with are not some of our peers with small launch vehicles, they’re SpaceX. And so, I think we offer a position, we offer a product that has price as a, as a primary characteristic, and scale as a primary characteristic.
So we’ve invested in building his factory not to do a small number of launches at a high price, but to do a higher number of launches at a lower price. And so that’s why we really lead with price, because we believe that some of these mega constellation operators need choices. And we want to give them another choice. That isn’t a large launch vehicle that’s economically viable for these operators.
Operator
Your next question comes from the line of Andre Madrid of Bank of America.
Andre Madrid
Thanks for taking my question. So glad to see you guys are focusing a little more on the engine side of things. Unfortunately, though, you’re not the only player out there doing that Rocket Lab has their own with, you know, HyperCurie? How do you guys see yourself differentiating from that? And just some of the key points as to where you see your product is different and better than what they’re doing over there with HyperCurie?
Chris Kemp
Well, I mean, I can tell you what our customers tell us. And what they tell us is that our product performs better. So we have a higher ISP. I can tell you that we’ve operated our product successfully in space it’s now ignited hundreds of times. And I can tell you that it’s very cost competitive. And I think that as we work with our customers, we’re trying to strike that balance of offering a product that is higher performance, lower cost.
And we’re going to obviously continue to invest heavily in making sure that we can scale the production to meet the demand that we’re seeing out there. And that’s why you’ve seen us release in today’s earnings announcement, the detail around the new facility, we’re building out 60,000 square feet of facility dedicated to scaling the production of those spacecraft engines.
Operator
[Operator Instructions] You have a follow-up question from the line of Edison Yu at Deutsche Bank.
Edison Yu
Actually, just one more follow-up from me and it was actually about the engine. Is there any way you can breakdown the composition of those orders, as in? You know, are those what – what type of spacecraft or what type of use cases and we can kind of break that down a little bit more?
Chris Kemp
I mean, what I’ll say is that the way the product is sold, is it’s very modular. So it’s, it’s a true product in the sense that there’s a thruster, there’s electronics, there’s a there’s a, there’s a feed system and tank, and we can actually configure it in a lot of different ways. So we’re selling them to a lot of different customers that have different size satellites, with different mission parameters.
And we do that by taking that product and, and configuring it differently. You can have one engine, two engine, one thruster, two thruster or three thrusters. And we’ve actually seen our customers deploy in a lot of different configurations. So it’s very flexible. And it really doesn’t target just one segment of the of the satellite market. It’s being adopted by a lot of different types of satellites.
Edison Yu
Understood and would you be going after a pretty, are you going after a pretty big constellation there since it is? I think you mentioned it’s a whole thruster?
Chris Kemp
Yes.
Edison Yu
Would that be something that you could sell to, you know, a fairly large constellation?
Chris Kemp
Yes once they don’ have their own already developed. So I would look at the – if you’re trying to forecast the size of the market I would just look at the folks that are building their own and then everyone else’s is how we consider the channel.
Operator
Your next question is a follow-up from the line up Andre Madrid of Bank of America.
Andre Madrid
Just to give a little context, I guess to everybody listening, could you use little bit more of why it’s important to have an engine on the system itself as opposed to relying on a space of sorts maybe like a momentous bigger ride – what’s stopping, you know, one customer from going with a more tailored approach than just, you know, using the services of the space hub?
Chris Kemp
I think that – all satellites that are, for example, communication satellites or operational satellites, require propulsion, if they’re – if they’re large, and if they’re meant to station key or if they’re meant to be positioned in a particular orbit, unless they’re like small cube sats. And I think we’re these transport vehicles, they actually, they actually use these propulsion systems to do the work of doing the final orbit positioning for the satellites that don’t have propulsion before they’re deployed.
But these are typically small satellites that are cube sats that just aren’t large enough and have the man power onboard to really keep the satellite lost. So they’re, they’re kind of very, very small satellites. Also, if you want to be able to deorbit, your satellite, these systems are very useful. So I think as we, as we see more pressure on operators to really remove the satellites from orbit once their life is over, all satellites are going to start to need some form of propulsion system or other system to assist with the orbiting.
Andre Madrid
Understood, and is there a large difference in price point, would you say?
Chris Kemp
Well, I think again, comparing a propulsion system that almost every satellite has to one of these delivery systems is you’re comparing apples and oranges. These the systems that are offered by the companies that do final positioning or their positioning, typically very small satellites, cube sats in particular places and these satellites are being sold to excuse me, the propulsion – the Astra spacecraft engine is being sold to the kind of call it a several 100 kilograms to 1000 kilogram class of mega community mega communication, satellite type applications or applications that involve the satellite leaving low Earth orbit and going to higher orbits or other places.
Andre Madrid
Okay, thank you. Yes, that’s the color I wanted to. I feel like sometimes the distinction isn’t always as clear. So appreciate you giving the breakdown.
Chris Kemp
Yes, you’re welcome. Yes and I think we announced we sold 103 of these so far. And really, we’re expecting the production to start to ramp up in 2023 and with that revenues from that product line.
Operator
This concludes the question and answer session of today’s call. I will now turn the floor back over to Chris Kemp, Chairman and CEO of Astra.
Chris Kemp
Thanks everyone for your time today. And I just want to let you all know that we appreciate your support and we look forward to providing you updates, both quarterly and also frequently as we make progress towards delivering the new Launch System 2.0 and continuing to announce new contracts for space products and services. Thanks all.
Operator
Thank you. This does concludes today’s call. Thank you for your participation on today’s event. You may now disconnect.
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