NEXTNAV INC.
For the period ended Dec 31, 2025. Filed Mar 17, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 17, 2026
NN$8.61+7.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-12.
0001213900-25-023287
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-17.
0001554855-26-000328
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 80 previous paragraphs and 73 current paragraphs.
37 unchanged; 20 reworded; 15 added; 21 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 11 previous and 11 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
We are the market leader in delivering resilient, next generation, complementary positioning, navigation and timing (“PNT”) solutions designed to overcome the limitations and vulnerabilities of existing space-based Global Navigation Satellite Systems (“GNSS”), including the Global Positioning System (“GPS”). PNT services are used in nearly every facet of our economy. Cellular and electrical distribution systems depend on GPS-based timing, and the mobile app economy relies on location to create innovative services and to drive data and advertising revenue. Public safety and enhanced 911 (“E911”) save lives every day with the use of location services. GPS has powered the global economy for nearly 40 years. Without high-precision timing from GPS, cellular systems would fail, the distribution of electricity would be impacted, and other aspects of everyday life would be adversely affected. Recent international events have demonstrated that having viable systems to backup and complement GPS is a national security issue.
Current report
Our PNT solutions address these needs and issues in several ways. Our technology consists of a ground-based transmitter network operating on low-band spectrum assets in a manner similar to the function of GPS satellites. Unlike satellites, our network signals are designed to be much stronger and extremely difficult to jam or spoof. In addition, because the signals are terrestrial and low-band, they can penetrate buildings. As a result, our technology can act as a complement to satellite-based GPS, especially in urban canyons or deep indoors, and as a backup in case traditional GPS fails due to jamming, spoofing, technical failures, solar flares or other risks to satellite-based services. In addition, our location-based services are three-dimensional. Our core Pinnacle technology uses barometric sensors in smartphones and other communications devices and a network of sensors to determine vertical, or “z-axis”, location. This technology can provide accurate vertical location data to assist first responders, dispatchers and others, or could be used for autonomous systems, such as drones, in need of precise 3D mapping in urban areas, among other uses.
Current report
Our complementary PNT solutions are built on our asset base of FCC licenses that cover 12 MHz of low-band spectrum available for use. This spectrum consists of a contiguous 8 MHz block of 900 MHz spectrum covering over 90% of the U.S. population and an additional 4 MHz of complementary spectrum covering part of the U.S. population that was transferred to us in 2025 as a result of a transaction with Telesaurus and Skybridge Spectrum Foundation. That transaction also gave us potential rights to an additional 2 MHz of related spectrum covered by terminated Skybridge Spectrum Foundation licenses. These licenses are subject to a Skybridge and Telesaurus petition for reconsideration seeking reinstatement of these licenses. For more information on this transaction, refer to Note 3 to our consolidated financial statements for the twelve months ended December 31, 2025 included elsewhere in this Annual Report on Form 10-K.
Current report
We are evolving our PNT solutions to use 5G New Radio (“5G NR”) positioning reference signals (“PRS”), under the 3GPP global standard, to determine location and timing - a platform we refer to as NextGen. We believe the evolution of our existing technologies and services to a 5G NR PRS capability will improve the efficiency, flexibility, and scale of our operations. 5G NR technologies drive enhanced network performance, capacity, and efficiency across multiple industry verticals. 5G NR enables low-latency, high-throughput connectivity and also improves spectral efficiency, which allows operators to increase returns on investment in licensed spectrum and, with respect to our technology, to improve both the density and availability of PNT signals. 5G NR can also support many different applications, including ultra-reliable low-latency communications (URLLC), enhanced mobile broadband (eMBB), and massive machine-type communications (mMTC). These capabilities permit 5G NR to support high-performance broadband services as well as emerging use cases in autonomous systems, industrial automation, and the Internet of Things (IoT). As a result, spectrum that can support 5G technologies and services is important to broadband providers and their customers.
Current report
To enable our evolution to 5G NR, we have filed a Petition for Rulemaking (the “Petition”) asking the FCC to optimize the Lower 900 MHz radio spectrum band to enable 5G NR operations, the delivery of PNT via a 5G broadband network and in turn support such 5G technologies and services. Our Petition requests the FCC allow us to use a single, nationwide 15 MHz spectrum configuration for both PNT and 5G broadband. The Petition is subject to an ongoing FCC regulatory review process, and was referenced in the FCC’s March 27, 2025 PNT Notice of Inquiry.
Current report
Under our proposal, the FCC would create a 5 MHz uplink and 10 MHz downlink suitable for 5G operations. We believe modernizing the Lower 900 MHz band will simultaneously enable a high-quality terrestrial PNT network to complement and back up GPS, addressing a critical national security vulnerability, and add 5G broadband capacity. As such, our NextGen capability is being designed with the goal of enabling one or more mobile network operators or other partners to integrate this optimized Lower 900 MHz spectrum into their 5G network deployments. We expect that these partnerships would result in wide-scale availability of our complementary PNT services and, for our potential partners, additional 5G broadband capacity.
Current report
A core element of our strategy is to pursue such partnerships to offset the costs of deploying and operating a widescale, terrestrial PNT network that can act as a complement and backup to GPS. While GPS is fully supported by the U.S. government, we believe it is unlikely that the U.S. government would subsidize an extensive, standalone terrestrial PNT network and other revenue-generating opportunities are limited, given existing use of GPS. However, there is a financially viable path to a widescale terrestrial PNT network that meets critical national security needs through the spectrum optimization proposed by our Petition that would allow it to be used for 5G.
Current report
Macroeconomic Factors
Current report
Macroeconomic conditions, including changes in overall economic growth and broader business and government spending priorities, could affect our business, financial condition and results of operations. While our business is not highly sensitive to changes in interest rates, inflation or general capital market conditions, adverse macroeconomic developments may reduce or delay spending by wireless carriers, public sector and other commercial customers for our terrestrial PNT services and may affect the timing of planned projects and deployments. In addition, broader economic uncertainty, including the potential for federal government shutdowns, could delay administrative and regulatory actions by governmental agencies, including the Federal Communications Commission, that are important to the commercialization and expansion of our services. We continue to monitor macroeconomic developments and adjust our execution timelines as appropriate; however, prolonged or worsening economic conditions could negatively affect the timing of our initiatives and the pace of adoption of our solutions.
Current report
Revenue
Current report
Revenue
Current report
Research and development expenses increased by $2.7 million, or 17%, to $19.0 million for the year ended December 31, 2025 from $16.2 million for the year ended December 31, 2024. The increase was primarily driven by a $2.8 million increase in non-recurring engineering services, a $0.3 million increase in stock-based compensation, and a $0.2 million increase in other operational expenses. The increases were partially offset by a $0.6 million decrease in software license and cloud expenses.
Current report
We evaluate our debt agreements to determine whether debt contains embedded features requiring bifurcation from the debt host in accordance with ASC 815. If an embedded feature requires bifurcation from its debt host, we will account for it as a derivative at fair value. If a hybrid instrument has multiple embedded derivatives requiring bifurcation, we will bifurcate a single compound derivative. The Company uses valuation models to estimate the fair value of the bifurcated embedded derivatives.
Current report
In conjunction with the issuance of senior secured convertible notes in March 2025, we bifurcated the embedded conversion option as a derivative liability under ASC 815. For the valuation to record the debt and embedded derivative related to the conversion option at fair value, we used a binomial lattice valuation model and a “with-and-without” valuation methodology at inception and on subsequent valuation dates. This model incorporates inputs such as the stock price of the Company, risk-free interest rate, the transaction-calibrated debt yield and expected volatility. Certain inputs (e.g., expected volatility) involve unobservable inputs and are classified as level 3 of the fair value hierarchy. The sensitivity of the fair value calculation to these methods, assumptions, and estimates included could create materially different results under different conditions or using different assumptions. The fair value of bifurcated derivatives is presented in the same line item as debt in the Company's Consolidated Balance Sheets.
Current report
Unamortized debt discounts are written off and included in our gain or loss calculations to the extent the Company extinguishes debt prior to the original maturity.
Removed paragraphs (21)
Previous report
We are the market leader in delivering resilient, next generation, complementary positioning, navigation and timing (“PNT”) solutions designed to overcome the limitations and vulnerabilities of the existing space-based Global Positioning System (“GPS”) and Global Navigation Satellite Systems (“GNSS”). We are evolving our complementary PNT solutions to use 5 G New Radio (“5 G NR”) technologies(“NextGen”), in conjunction with our Petition for Rulemaking filed withthe FCC, to update and reconfigure the Lower 900 MHz band and our spectrum licenses. We expect the evolution of our platform to NextGen will significantly improve the efficiency, flexibility, and scale of our operations, technically enabling the delivery of high-quality PNT based on a 5 G broadband network. Our NextGen solution is being designed to allow one or more partners to integrate our Lower 900 MHz spectrum into their 5 G networks. We expect that this will result in wide-scale availability of both complementary PNT services and additional broadband capacity.
Previous report
Our complementary PNT solutions are built on a deep asset base, including valuable FCC licenses. Our licenses include a contiguous 8 MHz block of 900 MHz M-LMS spectrum covering over 90% of the U.S. population, and on March 7, 2024, we signed an agreement, subject to appropriate regulatory approvals, to acquire an additional 4 MHz of M-LMS licenses covering part of the U.S. population. On April 16, 2024, we petitioned the FCC to commence a rule making to reconfigure and update the rules governing the Lower 900 MHz band plan to allow us to utilize a 15 MHz nationwide configuration for both PNT and 5G broadband (“Petition”). The Petition is subject to an ongoing FCC regulatory review process. We believe that modernizing the Lower 900 MHz band will simultaneously enable a high-quality terrestrial PNT network to complement and back up GPS, address a critical national security vulnerability, and add 5 G broadband capacity. We have been granted more than 145 patents related to our systems and services, and standardized certain of our technologies with the 3 rd Generation Partnership Project (3 GPP), a global telecommunications standards-setting body.
Previous report
The impact of GPS on the U.S. economy was nearly $1.4 trillion in the aggregate between 1984 and 2017, according to data from a National Institute of Standards and Technology (“NIST”)-sponsored study conducted by RTI International (“RTI”), and the European Commission estimated the annual impact on the economy of the European Union in its 2018 budget process as EUR 1.2 trillion. The usage of GPS services is also rapidly expanding, with its presence in devices in the U.S. increasing from 600 million devices to 900 million devices between 2015 and 2019, according to information presented to the National Space-Based PNT Advisory Board by the National Coordination Office for Space-Based PNT. PNT resiliency is a priority of the U.S. Federal Government and is rising in priority in the European Union, non-European Union countries in Eastern Europe and in other parts of the world due to both the demonstrated vulnerability and lack of local control of space-based signals and systems. Critical infrastructure, including communications networks and power grids, require a reliable GPS signal for accurate timing. A failure of GPS could be catastrophic, and there is no comprehensive, terrestrial backup that is widely deployed today. The Department of Homeland Security has also classified the PNT vulnerabilities from GPS as cyber security threats, and the U.S. Department of Transportation (“DoT”) has also outlined a Complementary PNT Action Plan, among other key federal initiatives. Higher performance and availability will continue to expand the reach and value of PNT solutions, while terrestrial resilience is essential to protect the vast economic activity that is reliant on GPS.
Previous report
As we evolve our technology platform to NextGen and pursue regulatory changes to the Lower 900 MHz band and our spectrum licenses, we continue to deliver high-quality PNT services through our Pinnacle and TerraPoiNT solutions. Our Pinnacle solution, launched in partnership with AT&T Services, Inc. (“AT&T”) as part of its FirstNet®initiative, can provide accurate altitude service to any device with a barometric pressure sensor and covers over 90% of commercial structures over three stories in the U.S. Our Pinnacle system is primarily used for public safety applications, including enhanced 911 (“E 911”) for Verizon Communications, Inc. (“Verizon”), and a growing number of devices operating on the remaining national cellular network providers.
Previous report
Our TerraPoiNT system is a terrestrially based dedicated, complementary PNT network designed to overcome the limitations inherent in the space-based nature of GPS. GPS is a faint, unencrypted signal, which is often unavailable indoors, distorted in urban areas, and vulnerable to both jamming and spoofing. TerraPoiNT overcomes these limitations through a network of wide-area location transmitters that broadcast a PNT signal on our licensed Lower 900 MHz M-LMS spectrum. Unlike GPS, the TerraPoiNT signal can be reliably received indoors and in urban areas, is difficult to jam or spoof compared to GPS, and can support signal authentication (e.g., encryption). Further, the TerraPoiNT signal can embed Pinnacle information to provide a full three-dimensional PNT solution. TerraPoiNT received the highest scores in testing by the DoT reported in 2021 regarding potential PNT backup solutions, in each category tested, and was the only solution evaluated capable of providing the full set of services provided by GPS. Continuing our engagement with the DoT, in 2024 we were awarded a contract to establish performance characteristics for TerraPoiNT to allow DoT to incorporate our solutions into a clearinghouse of solutions defined in the DoT Complementary PNT Action Plan, for potential use by Federal government customers.
Previous report
Research and Development
Previous report
Selling, General and Administrative
Previous report
Research and Development
Previous report
Research and development expenses decreased by $3.3 million, or 17%, to $16.2 million for the year ended December 31, 2024 from $19.5 million for the year ended December 31, 2023. The decrease was primarily driven by a $2.5 million decrease instock based compensation, a $0.7 million decrease insoftware license expenses, a $0.4 million decrease inoutside consulting expenses, a $0.2 million decrease inmaintenance and operational cost, and a $0.1 million decrease in professional fee. The decreases were partially offset by a $0.6 million increase inpayroll-related expenses.
Previous report
Selling, General and Administrative
Previous report
Net cash provided by investing activities during 2023 was $1.1 million, representing sale and of maturity of marketable securities, net of purchase of marketable securities, andcash used for addition in property and equipment primarily related to the deployment of the TerraPoiNT networkand internal use software.
Previous report
Revenue Recognition
Previous report
We sell software licenses and services through arrangements that may bundle software, equipment, and other services. When we determine that we have separate distinct performance obligations, we allocate the bundled contract price among the various performance obligations based on each deliverable’s stand-alone selling price. If the stand-alone selling price is not directly observable, we estimate the amount to be allocated for each performance obligation based on observable market transactions. When we determine the performance obligations are not distinct, we recognize revenue on a combined basis as the obligation is satisfied. To the extent our contracts include variable consideration, the transaction price includes both fixed and variable consideration. The variable consideration contained within our contracts with customers may include discounts, credits and other similar items. When a contract includes variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include the variable consideration in the transaction price only to the extent that it is probable that a significant reversal of the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
Previous report
We recognize equipment sales and the related costs when control of the equipment passes to the customer, typically upon shipment. Customers do not have rights of return without our prior consent. Revenue pursuant to licensing agreements for our technology represents performance obligations that are satisfied over time. We recognize support services ratably over the periods in which the services are provided; the related costs are expensed as incurred.
Previous report
The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables, and deferred revenue on the Consolidated Balance Sheets. We bill amounts under our agreed-upon contractual terms at periodic intervals for services, upon shipment for equipment, or upon achievement of contractual milestones or as work progresses. Billing may occur subsequent to revenue recognition, resulting in accounts receivable. We may also receive payments from customers before revenue is recognized, resulting in deferred revenue.
Previous report
Indefinite-lived Intangible Assets
Previous report
We hold wireless Multilateration LMS licenses. Certain general regulatory requirements apply to all licensed wireless spectrum, including, for example, certain build-out or “substantial service” requirements, which generally must be satisfied as a condition to the retention of the license. We are actively engaged in either meeting such requirements currently or seeking an extension of such requirements from the FCC for each of our LMS licenses. Although licenses are issued for only a fixed time, ten years, such licenses are subject to renewal by the FCC, based on the achievement of certain milestones and a finding that such renewal would serve the public interest. Renewal of our licenses has occurred previously and at nominal cost. As a result, we treat our wireless LMS spectrum licenses as an indefinite-lived intangible asset. We reevaluate the useful life determination for wireless licenses each year to determine whether events and circumstances continue to support an indefinite useful life. Costs incurred to maintain the FCC licenses are recorded in operating expenses.
Previous report
We assess indefinite-lived intangible assets for potential impairment annually as of October 1, or during the year if an event or other circumstance indicates that we may not be able to recover the carrying amount of the asset. In evaluating indefinite-lived intangible assets for impairment, we first assess qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. If we conclude that it is not more likely than not that the fair value of the asset is less than its carrying value, then no further testing is required. However, if we conclude that it is more likely than not that the fair value of the asset is less than its carrying value, then we perform atwo-step impairment test to identify potential impairment and measures the amount of impairment we will recognize, if any.
Previous report
Goodwill
Previous report
Goodwill is tested for impairment annually in the fourth quarter or more frequently if events or changes in circumstances indicate that the asset may be impaired. The Company operates asone reporting unit. When testing goodwill for impairment, the Company may first perform an optional qualitative assessment. If the Company determines it is not more likely than not the reporting unit’s fair value is less than its carrying value, then no further analysis is necessary. If the Company determines that it is more likely than not that the fair value of its reporting unit is less than its carrying amount, then the quantitative impairment test will be performed. Under the quantitative impairment test, if the carrying amount of the Company’s reporting unit exceeds its fair value, the Company will recognize an impairment loss in an amount equal to that excess but limited to the total amount of goodwill.
Reworded paragraphs (20)
Previous wording
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Current wording
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto and other financial information included elsewhere in this Annual Report on Form 10-K. In addition to historical information, some of the information contained in the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Actual results and outcomes could differ materially for a variety of reasons. You should review “Cautionary Note Regarding Forward-Looking Statements” and “Item 1 A. Risk Factors” of this Annual Report on Form 10-K for a discussion of important factors that could cause our actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto and other financial information included elsewhere in this Annual Report on Form 10-K. In addition to historical information, some of the information contained in the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Actual results and outcomes could differ materially for a variety of reasons. You should review “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors” of this Annual Report on Form 10-K for a discussion of important factors that could cause our actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Previous wording
Simultaneously, demand for wireless data services continues to grow. The backbone of wireless data services, electromagnetic spectrum, is a finite resource. Our spectrum licenses, which lie in the Lower 900 MHz band, are referred to as “low-band spectrum.” There is a finite amount of low-band spectrum available, and low-band spectrum has favorable coverage characteristics compared to higher frequencies, including the ability to provide services indoors and over greater distances. These characteristics result in its ability to be used for coverage and to be deployed more economically, with higher-frequency spectrum often used to provide additional capacity in targeted locations. The transition to 5 G NR for our PNT services will provide a technical capability to support broadband data services, which, subject to appropriate regulatory approvals, may allow the spectrum to be utilized to help meet the continued, growing demand for wireless data capacity.
Current wording
The backbone of wireless data services, electromagnetic spectrum, is a finite resource. Our spectrum licenses, which lie in the Lower 900 MHz band, are referred to as “low-band spectrum.” There is a finite amount of low-band spectrum available, and low-band spectrum has favorable coverage characteristics compared to higher frequencies, including the ability to provide services indoors and over greater distances. These characteristics result in its ability to be used for coverage and to be deployed more economically, with higher-frequency spectrum often used to provide additional capacity in targeted locations. The transition to 5G NR for our PNT services will provide a technical capability to support broadband data services, which, subject to appropriate regulatory approvals, would allow the spectrum to be used to help meet the continued, growing demand for wireless data capacity.
Previous wording
Cost of goods sold (“COGS”) consist of personnel-related expenses, including salaries, benefits and stock-based compensation, and allocated facility costs for our operations and manufacturing teams. COGS also includes expenses for site leases, cost of equipment, software license costs, including cloud hosting costs, and professional services related to the maintenance of the equipment at each leased site. Our COGS may increase for the foreseeable future as we continue to invest in our PNT technologies in domestic U.S. and international markets.
Current wording
Cost of goods sold (“COGS”) consist of personnel-related expenses, including salaries, benefits and stock-based compensation, and allocated facility costs for our operations and manufacturing teams. COGS also includes expenses for site leases, cost of equipment, software license costs, including cloud hosting costs, and professional services related to the maintenance of the equipment at each leased site. Our COGS may fluctuate from period to period based on changes in operating scale.
Previous wording
Other income (expense) consists of miscellaneous non-operating items, such as change in fair value of warrants and Asset Purchase Agreement liability, equity method income (loss), and foreign currency gains (losses).
Current wording
Other income (expense) consists of miscellaneous non-operating items, such as change in fair value of warrants, change in fair value of derivative liability, debt extinguishment loss, equity method income (loss), and foreign currency gains (losses).
Previous wording
Revenue increased by $1.8 million, or 47%, to $5.7 million for the year ended December 31, 2024 from $3.9 million for the year ended December 31, 2023. The increase was driven by an increase in service revenue from technology and services contracts with government and commercial customers. For the year ended December 31, 2024, three customers accounted for 57%,18% and 11% of total revenue. For the year ended December 31, 2023, two customers accounted for 75% and 10% of total revenue. Accounts receivable as of December 31, 2024 and December 31, 2023 were $3.3 million and $2.3 million, respectively; the deferred revenue balance as of December 31, 2024 and December 31, 2023 was $0.3 million.
Current wording
Revenue decreased by $1.1 million, or 19%, to $4.6 million for the year ended December 31, 2025 from $5.7 million for the year ended December 31, 2024. The decrease was driven by lower service revenue from technology and services contracts with government and commercial customers. For the year ended December 31, 2025, two customers accounted for 70% and 17% of total revenue. For the year ended December 31, 2024, three customers accounted for 57%,18% and 11% of total revenue. Accounts receivable as of December 31, 2025 and December 31, 2024 were $2.3 million and $3.3 million, respectively; the deferred revenue balance as of December 31, 2025 and December 31, 2024 was $0.5 million and $0.3 million, respectively.
Previous wording
COGS decreased by $2.0 million, or 15%, to $10.8 million for the year ended December 31, 2024 from $12.7 million for the year ended December 31, 2023. The decrease was primarily driven bya $1.6 million decrease in stock-based compensation, a $0.4 million decreasein software license expenses, a $0.3 million decrease inoutside consulting expenses, anda $0.3 million decrease inmaintenance and operational cost. The decreases were partially offset by a $0.3 million increase inpayroll-related expenses, a$0.2 million increase in site rent expense due to deployment of new sites in second and third quarter of 2023, and a$0.1 million increase in non-recurring engineering services.
Current wording
COGS decreased by $2.2 million, or 21%, to $8.5 million for the year ended December 31, 2025 from $10.8 million for the year ended December 31, 2024. The decrease was primarily driven by a $0.9 million decrease in payroll-related expenses, a $0.6 million decrease in software license expenses, a $0.4 million decrease in site rent expense, a $0.2 million decrease in non-recurring engineering services, and a $0.1 million decrease in outside consulting expenses.
Previous wording
Selling, general and administrative expenses increased by $3.2 million, or 11%, to $33.5 million during the year ended December 31, 2024 from $30.3 million in the year ended December 31, 2023. The increase was primarily driven by a $3.0 million increase inprofessional services, a$3.0 million increase inpayroll-related expenses driven by headcount costs, executive and employment separation costs, a $1.0 million increase inoutside consulting expenses, a $0.5 million increase inother operational expenses, and a $0.3 million increase in marketing and recruiting cost. The increases were partially offset by a $3.8 million decrease instock-based compensation and a $0.8 million decrease indirectors’ and officers’ insurance.
Current wording
Selling, general and administrative expenses increased by $6.1 million, or 18%, to $39.6 million during the year ended December 31, 2025 from $33.5 million in the year ended December 31, 2024. The increase was primarily driven by a $2.5 million increase in stock-based compensation, a $1.6 million increase in outside consulting expenses, a $1.1 million increase in payroll-related expenses driven by headcount costs, a $0.5 million increase in marketing and recruiting cost, a $0.3 million increase in professional services and a $0.1 million increase in other operational expenses.
Previous wording
Depreciation and amortization expenses increased by $0.4 million, or 9%, to $5.2 million during the year ended December 31, 2024 from $4.8 million during the year ended December 31, 2023. The increase in depreciation and amortization expense is primarily attributable to placing the network assets in service since the third quarter of 2023.
Current wording
Depreciation and amortization expenses increased by $2.5 million, or 48%, to $7.8 million during the year ended December 31, 2025 from $5.2 million during the year ended December 31, 2024. The increase in depreciation and amortization expense is primarily driven by accelerated depreciation related to retired network assets.
Previous wording
Interest expense, net of interest income, for the year ended December 31, 2024 was $9.4 million. Interest expense, net of interest income, for the year ended December 31, 2023 was $3.7 million. The increase in interest expense was due to interest and amortization of debt discounts on our senior secured notes issued during the second and third quarters of 2023.
Current wording
Interest expense, net of interest income, increased by $3.0 million, or 32%, to $12.4 million for the year ended December 31, 2025, compared to $9.4 million for the year ended December 31, 2024. The increase in interest expense was primarily driven by higher interest and amortization of debt discounts expense.
Previous wording
Other expense was $32.2 million for the year ended December 31, 2024 compared with other expense of $4.3 million for the year ended December 31, 2023.The increase was primarily driven bya $29.1 million increase in expense related tochange in the fair value of warrants, partially offset by $1.0 million of income related to the settlement of the Asset Purchase Agreement liability.
Current wording
Other expense was $106.4 million for the year ended December 31, 2025 compared with other expense of $32.2 million for the year ended December 31, 2024. The change was primarily driven by a loss resulting from the change in the fair value of the derivative liability, a debt extinguishment loss, a non-cash expense related to warrants issued in connection with the March 2025 debt financing, and losses from the change in the fair value of the warrant liability.
Previous wording
We have incurred net losses since our inception and to date have generated only limited revenue. We have primarily relied upon debt and equity financings to fund our cash requirements. During each of the twelve months ended December 31, 2024 and 2023, we incurred net losses of $101.9 million and $71.7 million, respectively. During each of the twelve months ended December 31, 2024, our net cash used in operating activities and cash provided by investing activities was $38.0 million was $39.5 million, respectively. During the twelve months ended December 31, 2023, our net cash used in operating activities and investing activities was $35.4 million and $1.1 million, respectively. As of December 31, 2024, we had cash and cash equivalents and marketable securities of $80.1 millionand an accumulated deficit of $862.1 million. We expect to incur additional losses and higher operating expenses for the foreseeable future. Our primary uses of cash are to fund our operations as we continue to grow our business. We will require a significant amount of cash for expenditures as we invest in ongoing research and development and our PNT networks.
Current wording
We have incurred net losses since our inception and to date have generated only limited revenue. We have primarily relied upon debt and equity financings to fund our cash requirements. During the twelve months ended December 31, 2025 and 2024, we incurred net losses of $189.3 million and $101.9 million, respectively. During the twelve months ended December 31, 2025, our net cash used in operating and investing activities was $50.7 million was $64.6 million, respectively. During the twelve months ended December 31, 2024, our net cash used in operating activities and investing activities was $38.0 million and $39.5 million, respectively. As of December 31, 2025, we had cash and cash equivalents and marketable securities of $152.1 millionand an accumulated deficit of $1.1 billion. We expect to incur additional losses and higher operating expenses for the foreseeable future. Our primary uses of cash are to fund our operations as we continue to grow our business. We will require a significant amount of cash for expenditures as we invest in ongoing research and development and our PNT networks.
Previous wording
Managing liquidity and our cash position is a priority of ours. We continually work to optimize our expenses in light of the growth of our business, and adapt to changes in the economic environment. We believe that our cash and cash equivalents and marketable securities as of December 31, 2024 will be sufficient to meet our working capital and capital expenditure needs, including all contractual commitments, beyond the next 12 months from the filing of this Annual report on Form 10-K. We believe we will meet longer term expected future cash requirements andobligations through a combination of our existing cash and cash equivalents balances and marketable securities, cash flows from operations, and issuance of equity securities or debt offerings. However, this determination is based upon internal financial projections and is subject to changes in market and business conditions.
Current wording
Managing liquidity and our cash position is a priority of ours. We continually work to optimize our expenses in light of the growth of our business, and adapt to changes in the economic environment. We believe that our cash and cash equivalents and marketable securities as of December 31, 2025 will be sufficient to meet our working capital and capital expenditure needs, including all contractual commitments, beyond the next 12 months from the filing of this Annual report on Form 10-K. We believe we will meet longer term expected future cash requirements and obligations through a combination of our existing cash and cash equivalents balances and marketable securities, cash flows from operations, and issuance of equity securities or debt offerings. However, this determination is based upon internal financial projections and is subject to changes in market and business conditions.
Previous wording
In 2023, we issued $70.0 million in aggregate principal amount of senior secured notes with a fixed interest rate of 10% to the lenders thereto. Such notes will mature on December 1, 2026 with interest payable semi-annually in arrears on June 1 and December 1 of each year. We may elect, at our sole discretion, to pay up to 50% of the accrued and unpaid interest on the senior secured notes due with our common stock. Refer to Note 8 to our consolidated financial statements for the twelve months ended December 31, 2024 included elsewhere in this Annual Report on Form 10-K for more information.
Current wording
On March 12, 2025, we entered into a Note Purchase Agreement to sell to a group of lenders in a private placement (the “Private Placement”) $190.0 million in aggregate principal amount of 5% Senior Secured Convertible Notes due in 2028 (the “2028 Notes”) at par. The 2028 Notes will mature on June 30, 2028 with interest payable in cash semi-annually in arrears on June 1 and December 1 of each year at 5% per annum. Upon the closing of the Private Placement, the Company used a portion of the net proceeds from the Private Placement to redeem all of its $70.0 million senior secured notes that were issued with a fixed interest rate of 10% to a group of lenders during 2023 (the “2026 Notes”), at a redemption price of 101% of the principal amount of the 2026 Notes, plus accrued and unpaid interest. Refer to Note 8 to our consolidated financial statements for the twelve months ended December 31, 2025 included elsewhere in this Annual Report on Form 10-K for more information.
Previous wording
Net cash used in operating activities during 2023 was $35.4 million, resulting primarily from a net loss of $71.7 million adjusted for non-cash charges of$21.8 million for stock-based compensation, $4.8 million for depreciation and amortization, $4.1 million for change in the fair value of warrant liability, $3.2 million in amortization of debt issuance costs, $0.5 million realized and unrealized gain on marketable securities, $0.2 million for equity method investment loss, and $0.1 million in asset retirement obligations accretion expense. Additionally, there was a net increase in operating liabilities of $2.7 million.
Current wording
Net cash used in operating activities during 2025 was $50.7 million, resulting primarily from a net loss of $189.3 million adjusted for non-cash charges of $77.2 million for change in the fair value of derivative liability, $16.6 million for stock-based compensation, $13.7 million loss on the early extinguishment of the 2026 Notes, $9.6 million in amortization of debt issuance costs, $9.0 million related to warrants issued in connection with 2028 Notes, $7.8 million for depreciation and amortization, $5.7 million for change in the fair value of warrant liability, $0.1 million in asset retirement obligations accretion expense, and a net increase in operating liabilities of $2.0 million. These changes were partially offset by non-cash income of $3.1 million for realized and unrealized gain on marketable securities, and $0.1 million for equity method investment gain.
Previous wording
Net cash used in operating activities during 2024 was $38.0 million, resulting primarily from a net loss of $101.9 million adjusted for non-cash charges of$13.9 million for stock-based compensation,$33.2 million for change in the fair value of warrant liability, $6.2 million in amortization of debt issuance costs,$5.2 million for depreciation and amortization, $0.2 million for equity method investment loss, and$0.1 million in asset retirement obligations accretion expense. These changes were partially offset by a net increase in operating liabilities of$7.0 million, non-cash income of$1.0 million for change in fair value of Asset Purchase Agreement liability, and$0.9 million realized and unrealized gain on marketable securities.
Current wording
Net cash used in operating activities during 2024 was $38.0 million, resulting primarily from a net loss of $101.9 million adjusted for non-cash charges of $13.9 million for stock-based compensation, $33.2 million for change in the fair value of warrant liability, $6.2 million in amortization of debt issuance costs, $5.2 million for depreciation and amortization, $0.2 million for equity method investment loss, and $0.1 million in asset retirement obligations accretion expense. These changes were partially offset by a net increase in operating liabilities of $7.0 million, non-cash income of $1.0 million for change in fair value of Asset Purchase Agreement liability, and $0.9 million realized and unrealized gain on marketable securities.
Previous wording
Net cash provided by investing activities during 2024 was $39.5 million, representing net purchase of marketable securi ties of $35.9 million, and cash used for Asset Purchase Agreement of $2.7 million and cash used for property and equipment, including internal use software of$0.8 million.
Current wording
Net cash provided by investing activities during 2024 was $39.5 million, representing net purchase of marketable securities of $35.9 million, and cash used for Asset Purchase Agreement of $2.7 million and cash used for property and equipment, including internal use software of $0.8 million.
Previous wording
Net cash provided by financing activities during 2023 was $69.0 million, primarily reflecting cash proceeds from issuance of senior secured notes, net of debt issuance cost.
Current wording
Net cash provided by financing activities during 2025 was $120.5 million, primarily reflecting cash proceeds from the issuance of the 2028 Notes, net of repayment of the 2026 Notes (refer to Note 8 to our consolidated financial statements for the twelve months ended December 31, 2025 included elsewhere in this Annual Report on Form 10-K for more information) and cash proceeds the from exercise of common stock options and warrants.
Previous wording
Inconjunction with the issuance of senior secured notes in May and July of 2023, we issued warrants tocertain ofthe purchasers thereto. We allocated the proceeds from the debt issuance to long term debt and equity classified warrants based on relative fair value as determined by the Discounted Cash Flow approach and Monte Carlo simulation model, respectively. The portion of proceeds allocated to equity-classified warrants and direct debt issuance costs are classified as debt discounts. The carrying value of long term debt in the Company’s consolidated balance sheet consists of principal amount of debt, net of debt discounts. Debt discounts are amortized to interest expense based on the related debt agreements primarily using the effective interest method.
Current wording
The carrying value of long-term debt in the Consolidated Balance Sheets generally consists of principal amount of debt, net of debt discounts. Debt discounts recognized as a result of allocating proceeds to bifurcated embedded derivatives as well as accounting for direct debt issuance costs are amortized to interest expense using the effective interest method.
Previous wording
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. Spartacus previously elected to avail itself of the extended transition period, and following the consummation of the Business Combination, we became an emerging growth company (for the period described in the immediately succeeding paragraph) and will continue to take advantage of the benefits of the extended transition period emerging growth company status permits. During the extended transition period, it may be difficult or impossible to compare our financial results with the financial results of another public company that complies with public company effective dates for accounting standard updates because of the potential differences in accounting standards used.
Current wording
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. Spartacus Acquisition Corp. (a Delaware special purpose acquisition company with which we consummated a business combination in 2021) previously elected to avail itself of the extended transition period, and following the consummation of such 2021 business combination, we became an emerging growth company (for the period described in the immediately succeeding paragraph) and will continue to take advantage of the benefits of the extended transition period emerging growth company status permits. During the extended transition period, it may be difficult or impossible to compare our financial results with the financial results of another public company that complies with public company effective dates for accounting standard updates because of the potential differences in accounting standards used.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash provided by investing activities during 2025 was $64.6 million, representing net purchase of marketable securities of 63.5 million, acquisition of equity method investments of $0.6 million, and cash used for property and equipment, including internal use software of $0.5 million.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
We derive our revenue from PNT technology, products and services including revenue generated through technology demonstration and assessment contracts with customers, support services provided to customers, sales of equipment, and licensing of proprietary technology.
Previous report — wording carried elsewhere
We recognize revenue when an arrangement exists, services, equipment or access to licensed technology are delivered, the transaction price is determined, the arrangement has commercial substance, payment terms are determined and collection of consideration is probable.