Intuitive Machines, Inc.
For the period ended Dec 31, 2025. Filed Mar 19, 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 19, 2026
LUNR$10.47+21.5%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 2025-03-25.
0001844452-25-000023
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-19.
0001628280-26-019865
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 193 previous paragraphs and 187 current paragraphs.
85 unchanged; 34 reworded; 66 added; 70 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 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 (66)
Current report
Intuitive Machines, Inc., collectively with its subsidiaries (the “Company,” “IM,” “Intuitive Machines,” “we,” “us” or “our”) is a space infrastructure and services company founded in 2013 and focused on enabling sustained infrastructure and human activity beyond Earth. We believe the United States is transitioning from episodic space missions to long-duration operations and persistent presence, and we are building the systems and services required to support this evolution across civil, national security, and commercial markets.
Current report
We design, build, integrate and operate spacecraft, communications networks, and space systems that support operations across low Earth orbit (“LEO”), geostationary orbit (“GEO”), cislunar space, and deep space. Our strategy is to evolve space activity from single-mission execution toward continuously operating infrastructure by combining spacecraft delivery with network connectivity and long-term operations. We believe this approach positions us to support enduring government requirements while enabling the development of a commercial space economy.
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Our operating model is organized around three integrated capabilities:
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•Build — designing, manufacturing, and delivering spacecraft, landers, satellites, surface systems, propulsion, and avionics for government and commercial customers;
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•Connect— integrating deployed assets into communications, navigation, command and control, and data relay networks that enable persistent connectivity; and
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•Operate— providing mission operations, hosted payload services, data services, navigation and timing capabilities, and other infrastructure-based offerings.
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We believe that operating deployed systems as infrastructure, rather than concluding at delivery, creates opportunities for longer-duration contracts, recurring revenue, and margin expansion over time.
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Stock Purchase Agreement - KinetX, Inc.
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On October 1, 2025, we completed the stock purchase agreement to acquire 100% of the issued and outstanding capital stock of KinetX, Inc (“KinetX”), a privately-held, Arizona-based aerospace company with more than 30 years of experience delivering flight-proven, deep space navigation, systems engineering, ground software, and constellation mission to the U.S. government and international customers. The consideration for the acquisition totaled approximately $31.3 million, consisting of cash consideration of $15.0 million, seller payable adjustments of $1.1 million treated as consideration transferred, and the issuance of 1,104,178 shares of our Class A Common Stock valued at $11.7 million based on the acquisition date closing stock price of $10.61. Approximately 329,827 shares of Class A Common Stock, valued at $3.5 million, were held back in escrow to settle any post-closing adjustments and/or potential claims. We funded the cash consideration using cash on hand.
Current report
The acquisition is intended to reinforce our flight dynamics and navigation integrated connect capabilities. We plan to pair KinetX software and talent with its lunar-proven flight systems, positioning us to lead in emerging opportunities like NASA’s Near Space Network services, the potential for Tracking and Data Relay Satellite System replacement, Mars data relay missions, and commercial operations of legacy Deep Space Network infrastructure. See Note 3 - Acquisitions for more information on the acquisition of KinetX.
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Lanteris Acquisition
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On January 13, 2026, we completed the acquisition of 100% of the issued and outstanding membership interests of Lanteris, pursuant to a Membership Interest Purchase Agreement with Vantor Holdings Inc. Formerly Maxar Space Systems, Lanteris is a spacecraft manufacturer serving national security, commercial and civil customers. In alignment with our vision, we believe the acquisition of Lanteris positions us as a vertically integrated, next generation space prime that can design, manufacture, deliver, and operate missions from earth orbit to the Moon, Mars, and beyond. See Note 19 - Subsequent Events for additional information on the Lanteris acquisition.
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Stifel Loan Agreement
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On January 12, 2026, the Company and Stifel Bank entered into a waiver, in respect to the loan agreement, pursuant to which Stifel Bank consented to the acquisition of Lanteris (as discussed above and in Note 19 - Subsequent Events) and halted any borrowing and covenant obligations by the Company under the revolving credit facility. See Note 8 - Debt for additional information on this loan and security agreement.
Current report
On February 27, 2026, the Company completed a definitive securities purchase agreement (“Securities Purchase Agreement”) with certain institutional investors or their affiliates (collectively, the “Investors”) relating to the issuance and sale to the Investors of shares of Class A Common Stock at a price of $15.12 per share for an aggregate purchase price of $175.0 million. See Note 19 - Subsequent Events for additional information.
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During 2025, we observed a significant shift in U.S. trade policy, with increased tariffs and the imposition of new tariffs that could impact our supply chain and our business. While some of these wide-reaching tariffs have been paused, these trade policy decisions are outside of our control and may have consequences for our business. Changes in trade policies, such as new tariffs or increases in tariffs, or reactionary measures including retaliatory tariffs or legal challenges, could have an adverse impact on our business. Even though we primarily sell our products and services to U.S. Government customers and our suppliers are primarily domestic, we have some exposure to imported materials and components. Based on current conditions, we do not expect a material impact on our results of operations or financial condition over the next year. We will continue to monitor the evolving trade landscape and assess potential implications on our supply chain and business.
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On September 30, 2025, the continuing resolution allowing U.S. government departments and agencies to operate through the end of the government fiscal year expired and the U.S. government entered a shutdown. Recently, from January 31, 2026 to February 3, 2026, the U.S. government partially shut down. As a result of any U.S. government shutdown, our business, program performance and results of operations may be impacted by the disruptions to federal government offices, workers, and operations, including risks relating to the funding of certain programs, stop work orders, delay in contract awards, new program starts, payments for work performed from U.S. government entities, and other actions. We may also experience similar impacts in the event of a series of short-term continuing resolutions rather than full-year fiscal year 2026 appropriations. Generally, the significance of these impacts will primarily be based on the length of the shutdown and timing of passage of a new continuing resolutions or a full budget.
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Service revenue
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Grant revenue
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From time to time, the Company may be awarded government grants. Government grants or awards are initially recognized when there is reasonable assurance the conditions of the grant or award will be met and the grant or award will be received. After initial recognition, government grants or awards are recognized as income under revenue within the statement of operations on a systematic basis in a manner consistent with the manner in which the Company recognizes the underlying costs included in the cost of revenue within the statement of operations for which the grant or award is intended to compensate.
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Cost of revenue (excluding depreciation and amortization)
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Depreciation and amortization
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Interest income
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Interest expense
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Interest expense is primarily incurred on the Convertible Notes as discussed in Note 8 - Debt, in addition to interest expense on our finance leases.
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Change in fair value of contingent consideration liabilities
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In connection with the acquisition of KinetX, the purchase price included a contingent consideration if certain future events or conditions are met and required the Company to holdback a number of shares of Class A Common Stock in escrow. The holdback was accounted for as contingent consideration and recorded as a liability based on its estimated fair value as of the acquisition date. We remeasure the contingent consideration at fair value each period with changes in fair value recorded in other income (expense) on our statements of operations. See Notes 3 and 13 of the consolidated financial statements for additional information on the contingent consideration liabilities.
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Other income, net
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Revenues
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•The initial NASA payload contract for the IM-2 mission was awarded in October 2020 and the mission was completed in March 2025. During the third quarter of 2025, the post-launch services were completed and the previously constrained revenue of$5.7 million was released and recognized as revenue, bringing the total IM-2 mission contract revenue under NASA and other commercial fixed-priced contracts to$131.2 million. As of September 30 2025, the IM-2 mission and all related contracts have been closed out.
Current report
Total revenue decreased by $17.9 million, or 8%, for the year ended December 31, 2025 compared to the same period in 2024, primarily driven by decreases on the OMES III contract of approximately$71.9 million due to NASA’s cancellation of the OSAM project task ordersand decrease of $5.6 million on LTV contract which was completed during the second quarter of 2025. These decreases were partially offset by overall increases in revenue from CLPS mission contracts of$25.3 million (as further discussed below), and new projects ramping up in 2025, most notably the NSN contract with an increase in revenue of$16.8 million and various other engineering services revenue increased by approximately $17.5 million.
Current report
The IM-1 mission successfully completed in February 2024 and resulted in the release of approximately$12.3 million of previously constrained revenue during the first quarter of 2024. Revenue on the IM-2 mission decreased slightly by $0.5 millionas the mission was completed in March 2025 and the mission close-out process was finalized in the third quarter of 2025. Revenue from the IM-3 mission increased by $3.7 million as activity picked up on IM-3 following the close-out of IM-2. The IM-4 mission which was awarded in August 2024, recognized revenue of$37.0 million during theyear ended December 31, 2025 compared to$2.4 million for the same period in 2024.
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Cost of revenue (excluding depreciation and amortization)
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Total cost of revenue decreased by $24.2 million, or 11%, for the year ended December 31, 2025 compared to the same period in 2024, primarily driven bythe OMES III contract cost decrease of $68.4 million due to NASA’s cancellation of the OSAM projectand decrease of $2.7 million on the LTV contract which was completed during the second quarter of 2025. These decreases were partially offset by overall cost increases related to the mission contracts of $23.8 million (as further discussed below), the NSN contract of $11.2 million, and various other engineering services of $12.0 million.
Current report
The IM-1 mission completed in February 2024 and incurred cost of revenue of $4.8 million during the first quarter of 2024. On the IM-2 mission, cost of revenue decreased by approximately $21.7 million for the year ended December 31, 2025 compared to the same period in 2024 as the mission was completed in March 2025. IM-3 mission cost of revenue increased by approximately $12.9 million for the year ended December 31, 2025 compared to the same period in 2024, as IM-3 mission activity increases following the final close-out of IM-2. As of December 31, 2025, the IM-3 contract is in a loss position and the accrued contract loss increased by approximately $7.6 million for year ended December 31, 2025 compared to the same period in 2024, driven by cost adjustments during the second quarter of 2025 related to decisions to align the mission schedule with the completion of an internally-developed satellite to be placed in lunar orbit to meet NSN contract obligations. The IM-4 mission which was awarded in August 2024, incurred cost of revenue of$40.1 million during theyear ended December 31, 2025 compared to$2.7 million for the same period in 2024. During the second quarter of 2025, IM-4 became a loss contract and has accrued contract losses of approximately $1.4 million for the year ended December 31, 2025.
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General and administrative expense (excluding depreciation and amortization)
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General and administrative expense (excluding depreciation and amortization) increased by $39.4 million for the year ended December 31, 2025 compared to the same period in 2024 and primarily reflects the Company’s investment in its workforce to support our operations and business infrastructure, business development (including acquisitions), and information technology to optimize corporate and operational processes and systems, and research and development initiatives to expand our product and service capabilities. The overall increase was primarily driven by professional fees of $12.1 million mostly related to legal and accounting fees, research and development of $11.1 million, higher employee compensation and benefits expense of $5.9 million, software licenses of $2.3 million, increase in bad debt expense of $3.0 million and various other administrative costs.
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Other income (expense)
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Total other expense, net favorable change of $273.8 million for the year ended December 31, 2025 compared to the same period in 2024 was primarily driven by the favorable changes in fair value of warrant liabilities of $86.0 million, earn-out liabilities of $86.8 million (as the remaining Earn Out Units vested in the first quarter of 2025), loss on issuance of securities of $93.1 million in 2024, and $15.0 million increase in interest income earned on cash and cash equivalents balances held by us in highly liquid interest bearing overnight sweep and demand deposit accounts slightly offset by increase in interest expense of $4.1 million mostly related to our Convertible Notes issued in August 2025 and various other unfavorable changes of $1.1 million.
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Backlog decreased by $115.3 million as of December 31, 2025 compared to December 31, 2024, due to continued performance on existing contracts of $210.1 million (most notably the OMES III contract 73.1 million, CLPS mission contracts $72.3 million, and NSN contract $18.5 million), IM-2 mission close-out adjustments of $8.4 million and adjustments on the IM-3 mission of $1.8 million. These decreases were partially offset by $105.0 million in new awards primarily associated with the OMES III contract $33.4 million, NSN contract $18.0 million, TSC grant $10.0 million, mission rideshare contracts $7.7 million and various other contracts.
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Previous report
We are a space technology, infrastructure, and services company founded in 2013 that is contributing to the establishment of cislunar infrastructure and helping to develop cislunar and deep space commerce. Cislunar encompasses objects in orbit in the Earth-Moon system and on the Lunar surface, while deep space exploration is space beyond the Moon, including Mars. We believe we have a leading position in the development of technology platforms operating in three core pillars —delivery services, data transmission services, and infrastructure as a service— as described below under Our Business Strategy. We are focused on establishing the lunar infrastructure associated with each of the three pillars, which provides the basis for commerce to inform and sustain human presence off Earth. Our vision is that our infrastructure services enable our customers to focus on their unique contributions to create a thriving, diverse cislunar economy and expand the commercial space exploration marketplace to the Lunar surface and beyond.
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The United States (“U.S.”) government has indicated that returning to the moon is of strategic importance to the U.S. and we believe it will continue to have bipartisan support as we enter the next generation space race withthe People’s Republic of China (“China”). We believe that space is the next economic frontier, with the moon being the next stepping stone, and the increased demand from governments, intelligence agencies, commercial industries, and private individuals has created multiple opportunities for long-term growth. We intend to participate in expanding the cislunar economy through a steady cadence of missions, with the intent of offering reduced cost of access and operations while providing reliable missions on a defined schedule. We are one of a select few companies servicing NASA and a worldwide set of commercial payload customers. We believe we have a strong position, as evidenced by four Commercial Lunar Payload Services (“CLPS”) awards to date as of December 31, 2024. On February 22, 2024, our Nova-C lander became the first U.S. vehicle to softly land on the lunar surface since 1972, utilizing our Nova-C Guidance, Navigation and Control (“GN&C”) and Propulsion systems, both of which were designed and are produced in-house. Our IM-1 Nova-C lander carried approximately 100 kilograms of science experiment and technology demonstration payloads, including the first CLPS payload, to a landing site closer to the lunar south pole than any previous mission. We operated on the lunar surface beyond the CLPS required mission duration and downloaded over 500 MB of payload customer data on our commercial Lunar Data Network. In March 2025, our IM-2 mission landed at the southernmost location of the moon, 5 degrees from the south pole. While in transit, our space to ground communications brought down over 8GB of data from space over our network; delivered 3 rideshare customers to trans lunar injection orbit and assisted them with ground tracking and communication; and demonstrated precision autonomous orbit operations circling the moon for 39 orbits over a 72 hour period. While on the surface, we demonstrated the ability to manage power in thermal conditions on the south pole surface and in a crater. With the challenge of not being able to recharge the IM-2 lander solar panels post landing, the mission was still able to complete several mission and payload milestones, including downloading 500 MB of payload customer data from the lunar surface. See Our Business Strategyfor a description of our additional lunar missions, lunar relay communications, lunar vicinity navigation, and autonomous surface rover operations.
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The U.S. Space Force (“Space Force”) has recently begun to turn its attention to the cislunar space, as noted in the Mitchell Institute paper “Securing Cislunar Space and the First Island Off the Coast of Earth.” As the leading CLPS provider and the first company to have successfully landed and operated on the Moon, we believe we are at the forefront of NASA's push for a sustainable return to the lunar surface, while simultaneously driving critical early conversations with the U.S. Department of Defense (“U.S. DoD”) and Space Force to secure the Moon and cislunar space to ensure peaceful and strategic operations in this emerging domain.
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Our Business Model
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We primarily generate revenue through our contracts with customers of our orbital and lunar access services and by collecting and transmitting cislunar data for science, technology and infrastructure. We are a provider and supplier of space products and services that we believe will enable sustained robotic and human exploration to the Moon, Mars, and beyond.
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We employ a “land-and-expand” go-to-market strategy with the goal to deliver increasing value and repetitive revenue with each customer over time by expanding the scope of the services we offer. We work closely with our customers and partners to enable their early success. We expect that deeper adoption of our products and services from our customers will come in many forms, including increased reliance on our technology as a core part of a mission, increased usage of our landers for lunar transportation and exploration, and greater dependence on our advanced software analytics capabilities for satisfying each customers’ needs.
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We operate under three core pillars which we believe are required to develop cislunar and deep space commerce: delivery services, data transmission services, and infrastructure as a service. Under Accounting Standards Codification (“ASC”) 280 “Segment Reporting,” we concluded that our core pillars operate as one reportable segment. See our Segment Reporting disclosure under Notes 2 and 16 in our consolidated financial statements for further discussion on our reportable segment. Provided below are summarized descriptions of our three core pillars.
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•Delivery Services provides for the transportation and delivery of payloads, such as, satellites, scientific instruments and cargo to various destinations in space, in addition to rideshare delivery and lunar surface access.
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•Data Transmission Services offerings include the collection, processing, and interpretation of space-based data, utilizing applications, such as, command, control, communications, reconnaissance and prospecting.
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•Infrastructure as a Service delivers space assets performing tasks and making decisions without human intervention that are designed to perform essential functions, such as, navigation, maintenance, scientific data collection, and system health monitoring.
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We integrate these fundamental pillars to not only enable access to the Moon but also to lay the foundation for a thriving cislunar and deep space economy. We believe our delivery, data transmission, and infrastructure capabilities uniquely position us to drive innovation, create long-tail revenue streams, and ultimately support humanity’s push to establish profitable industries in space. We expect to achieve leading time to market across these core pillars driven by our short design to manufacture process, enabled through vertical integration and rapid iterative testing. We leverage technologies developed for our three core service pillars to expand into adjacent markets where these capabilities provide a competitive advantage.
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Delivery Services
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We utilize our proprietary lunar lander vehicles to service CLPS contracts by flying NASA scientific equipment and commercial payloads to the lunar surface and supporting mission operations. With four CLPS contracts awarded to date, we are pioneering lunar access. We are also scaling our lander capabilities to support larger payloads, including heavy cargo-class infrastructure delivery for projects like the Lunar Terrain Vehicle (“LTV”), ensuring a reliable path for sustained human and robotic exploration of the Moon.
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In August 2024, NASA awarded Intuitive Machines a $116.9 million contract to deliver six science and technology payloads, including one European Space Agency-led drill suite to the Moon’s South Pole. This award leverages the Company’s lunar delivery, data transmission, and autonomous operation capabilities to explore the region targeted for sustained human operations. As part of NASA’s CLPS initiative, this marks the Company’s fourth contract award, IM-4, to deliver science and technology payloads and return valuable data while autonomously operating on the surface of the Moon. In February 2024, our IM-1 lander became the first U.S. vehicle to softly land on the lunar surface since 1972. In March 2025, our IM-2 mission landed at the southernmost location of the Moon, 5 degrees from the south pole. While on the surface, we demonstrated the ability to manage power in thermal conditions on the south pole surface and in a crater. With the challenge of not being able to recharge the IM-2 lander solar panels post landing, the mission was still able to complete several mission and payload milestones.
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Revenue streams from delivery services are expected to include transportation and delivery of payloads (satellites, scientific instruments, and cargo) to various destinations in space, including rapid in-space mobility solutions enabled by our proprietary engine technology.
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Data Transmission Services
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We believe that our Data Transmission Services offering is made up of a validated and complete lunar communications solution. Our Lunar Data Network (“LDN”) consists of our Nova Control Center (“NCC”), our existing global collection of dishes called the Lunar Telemetry, Tracking and Communications Network (“LTN”), and a constellation of Lunar Data Network Satellites to be deployed as part of our NSN 2.2 contract award.
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In September 2024, NASA awarded Intuitive Machines the sole NSN contract for communication and navigation services for missions in the near space region, which extends from Earth’s surface to beyond the Moon (NSN 2.2). The NSN contract is a firm-fixed-price, multiple award, Indefinite-Delivery/Indefinite-Quantity (“IDIQ”) task order contract, with a base period of five years with an additional five-year option, with a maximum potential value of $4.82 billion. The initial NSN contract award includes incrementally funded task orders totaling $150.0 million over the next 3 years. As the sole awardee of the initial tranche of NSN contracts, we are deploying a constellation of lunar relay satellites to provide continuous cislunar communication and navigation services. This capability supports NASA’s Artemis missions while introducing a scalable, pay-by-the-minute data service model, enabling enhanced video, telemetry, and autonomous navigation. Our strategy leverages the additional performance capacity of our lunar landers to deploy satellites at marginal costs, creating a robust and cost-effective lunar communication infrastructure that forms the data backbone of our cislunar operations. We believe providing these lunar data and navigation services to NASA, NSS, and commercial/international customers will be an increasingly important priority.
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In December 2024, NASA awarded Intuitive Machines NSN contracts for DTE services for the lunar vicinity (NSN 1.2) and beyond the lunar vicinity (NSN 1.3). These contracts allow use of terrestrial ground stations to support science missions in lunar orbit, on the lunar surface, or beyond the Moon. Our network is secured by layered levels of protection including advanced architecture, enterprise-level endpoint and antivirus protection, and Splunk advanced Security Information & Event Management (“SIEM”) control. Our Network Control Center (“NCC”) is located at our headquarters in Houston, Texas and was built from the ground up. NCC enables collaboration, innovation and seamless operations, in this 24-hour facility that was designed to provide tracking, telemetry and communications support for cislunar space and the surface of the Moon.
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Our network is secured by layered levels of protection including advanced architecture, enterprise-level endpoint and antivirus protection, and Splunk advanced Security Information & Event Management (“SIEM”) control. Our Network Control Center (“NCC”) is located at our headquarters in Houston, Texas and was built from the ground up by our highly experienced team. NCC enables collaboration, innovation and seamless operations, in this 24-hour facility that was designed to provide tracking, telemetry and communications support for cislunar space and the surface of the Moon.
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Once established and deployed, the data transmission services are expected to include and support NASA, U.S. national security, international, and commercial data needs. We will collect, transmit, and monetize data buys from data collected in-transit to the moon, in a variety of cislunar orbits, and on the surface of the moon for our future missions.
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Infrastructure as a Service
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Our Infrastructure as a Service pillar delivers essential systems and platforms to enable sustainable lunar exploration and commercial activity. By focusing on mobility, energy, and operational capabilities, we are creating the foundational infrastructure needed to support NASA’s Artemis campaign and commercial endeavors on the Moon. Key areas of focus include the LTV, its commercialization potential, and the Fission Surface Power (“FSP”) initiative, all designed to build a thriving and sustainable lunar economy.
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During 2024, NASA awarded Intuitive Machines a $30.8 million LTV contract to support the agency’s Artemis Campaign as a prime contractor, leading the development of the Moon RACER. Designed to operate in extreme lunar conditions, including the Moon's South Pole, the LTV features advanced autonomous driving, power management, and communications systems.
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Adjacent and Opportunistic Market Opportunities
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Due to Intuitive Machines’ unique technology platforms and engineering expertise, we are also pursuing and executing on business opportunities outside the three core pillars for customers aligned with our talent and product offerings. This includes work on the JETSON Low Power project for the Air Force Research Laboratory (AFRL), the development of scalable reentry technologies, and federal engineering services contracts at various NASA centers.
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In the $9.5 million JETSON Low Power project, we are helping AFRL develop the architecture and technology for deploying and maintaining a network of navigation beacons in cislunar space that require little-to-no support once delivered to their orbits. This includes a new radioisotope power generator that gives IM invaluable experience with nuclear power systems that can be applied to future lunar surface infrastructure, such as NASA’s FSP program.
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We have also made significant progress to date in federal services contracts. Our federal service contracts provide us access to one of our key customers, NASA, allows us to develop technologies important for the cislunar economy, and provides a skilled labor force which can support our three core pillars. In 2023, we were awarded as the prime contractor by NASA on the OMES III contract, with a focus on spacecraft mechanisms and robotics. In addition in 2024, we were also selected as an awardee under the One Acquisition Solution for Integrated Services Plus Multi-Agency Contract (“OASIS+”).
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In December 2024, the Company completed an underwritten public offering of 10,952,381 shares of its Class A Common Stock at a price to the public of $10.50 per share (the “Public Offering”), which included the full exercise of the underwriters’ option to purchase an additional 1,275,714 shares of Class A Common Stock from the Company. The Company also entered into an agreement with an accredited investor, pursuant to which the Company sold to the investor $10.0 million of shares of its Class A Common Stock in a concurrent private placement at a purchase price per share equal to the public offering price per share in the Offering of $10.50 (the “Private Offering” together with the Public Offering, the “2024 Offering”). The net proceeds to the Company from the Offering and concurrent private placement, after deducting transaction costs of $6.5 million, were approximately $116.9 million.
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In December 2024, the Company secured two additional contracts from NASA’s Near Space Network (“NSN”) for Direct-to-Earth (“DTE”) services. DTE communication and navigation services are critical for enabling missions to exit Earth’s orbit, reach lunar destinations, and explore deep space. The new contract awards are NSN 1.2 for DTE Geostationary to Cislunar DTE Services, offering enhanced data transmission capabilities and autonomous operations and NSN 1.3 for xCislunar DTE Services, addressing mission needs for highly elliptical orbits and deep space operations. Both contracts are firm-fixed-price, indefinite-delivery/indefinite-quantity task orders designed to bolster NASA’s Lunar Exploration Ground Segment. These awards add capacity to alleviate demand on the Deep Space Network and support unique mission requirements.
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On February 4, 2025, the Company announced the redemption of all of its outstanding warrants (the Public Warrants and Private Warrants as defined in Note 9, collectively the “Warrants”) to purchase shares of the Company’s Class A Common Stock that were issued under the warrant agreement, dated September 21, 2021 (the “Warrant Agreement”), by and between the Company and Continental Stock Transfer & Trust Company, as warrant agent, and that remained unexercised at 5:00 p.m., New York City time, on March 6, 2025 (the “Redemption Date”) for the redemption price of $0.01 per Warrant. During the period from January 1, 2025 to March 6, 2025, 15,358,229 of the Warrants were exercised resulting in gross proceeds of $176.6 million. On the Redemption Date, a total of 6,571,724 Warrants remained unexercised as of 5:00 p.m. New York City time, and the Company redeemed those Warrants for an aggregate redemption price of $66 thousand. As such, the Warrants ceased trading on the Nasdaq and were delisted, with the suspension of trading effective before the market opened on March 6, 2025. In connection with the Warrant Redemption, Michael Blitzer, a director and warrant holder, agreed to exercise 1,800,000 of the Warrants, and the Company agreed to repurchase 941,080 shares of the Company’s Class A Common Stock for an aggregate purchase price of $20.7 million.
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Earn Out Units
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On February 4, 2025, the Company issued an aggregate of 7,500,000 shares of Intuitive Machines’ Class C Common Stock in connection with meeting the conditions of the following milestones, Triggering Events II-A and III (as defined in Note 2), resulting in the vesting of Earn Out Units of 5,000,000 and 2,500,000, respectively. Refer to Note 2 for additional information on the Earn Out Units.
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On March 4, 2025, we entered into a loan and security agreement (the “Loan Agreement”) with Stifel Bank. The Loan Agreement provides for a secured revolving credit facility in an aggregate principal amount of up to $40.0 million (the “Revolving Facility”). The proceeds of the loans (and any letters of credit issued thereunder) may be used for the funding of growth initiatives, including working capital needs and general corporate purposesas the Company continues to focus on minimizing its cost of capital while maximizing available funding alternatives. Amounts outstanding under the Revolving Facility will bear interest at a rate per annum equal to the greater of (a) Term SOFR (secured overnight financing rate) plus 2.75% and (b)6.00%. The Loan Agreement matures on April 30, 2027 (the “Maturity Date”). Subject to certain conditions in the Loan Agreement, amounts borrowed thereunder maybe repaid and reborrowed at any time prior to the Maturity Date. As ofthe date of this filing, the revolving credit facility remains unborrowed.
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Revenue
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Cost of revenue (excluding depreciation)
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Depreciation
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Interest income (expense), net
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Prior to closing the Business Combination (as discussed in Note 1), Intuitive Machines, LLC issued six SAFE Agreements in late 2021 and early 2022. The funds received upon issuance of the SAFE Agreements were used to fund operations. Pursuant to the guidance under ASC 480 “Distinguishing Liabilities from Equity,” management determined that the SAFE Agreements should be initially recorded as liabilities at fair value and subsequently remeasured at fair value with changes recognized in earnings until conversion at a qualifying financing event or termination of the SAFE Agreements. Upon the consummation of the Business Combination in February 2023, the SAFE Agreements liability was eliminated and converted into shares of our Class A Common Stock. See Note 11 - Fair Value Measurements of the consolidated financial statements for additional information on the SAFE Agreements.
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Other income (expense), net
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Reworded paragraphs (34)
Previous wording
As a result of the closing of the Business Combination on February 13, 2023, which was accounted for as a reverse recapitalization in accordance with U.S. GAAP, the financial statements of Intuitive Machines, LLC, a Delaware limited liability company and our wholly-owned subsidiary, are now the financial statements of the Company. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report. Certain of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the sections titled “Cautionary Note Regarding Forward-Looking Statements” and Part I. Item 1A. “Risk Factors” included in this Annual Report, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Current wording
As a result of the closing of the Business Combination (as defined in Note 1)on February 13, 2023, which was accounted for as a reverse recapitalization in accordance with U.S. GAAP, the financial statements of Intuitive Machines, LLC, a Delaware limited liability company and our wholly-owned subsidiary, are now the financial statements of the Company. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report. Certain of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the sections titled “Cautionary Note Regarding Forward-Looking Statements” and Part I. Item 1A. “Risk Factors” included in this Annual Report, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Previous wording
We continue to monitor economic conditions and the impact of macroeconomic pressures, including repercussions from the recent banking crisis, rising interest rates, sustained inflation and recession fears, supply chain disruptions, monetary and fiscal policy measures (including future actions or inactions of the United States government related to the “debt-ceiling”), heightened geopolitical tensions (such as the war in Ukraine and Israel), changes to the U.S. federal budget, and the political and regulatory environmenton our business, customers, suppliers and other third parties.
Current wording
We continue to monitor economic conditions and the impact of macroeconomic pressures, including repercussions from elevated interest rates, sustained inflation and recession fears, supply chain disruptions, monetary and fiscal policy measures (including future actions or inactions of the United States government related to the “debt-ceiling” or “Department of Government Efficiency” actions), heightened geopolitical tensions (such as the war in Ukraine and Israel), changes to the U.S. federal budget, current or future government shutdowns, and the political and regulatory environment (including changes as a result of policy shifts implemented by the current administration)on our business, customers, suppliers and other third parties. While rising costs and other inflationary pressures have not had a material impact on our business to date, we are monitoring the situation and assessing its impact on our business, including to our partners and customers.
Previous wording
We are in the preliminary stages of developing our full space infrastructure offerings. These services are expected to grant customers access to cislunar space and the lunar surface at lower price points than previous lunar missions. We are also working to provide data transmission services at lunar distance to include far-side connectivity, along with ancillary services that are likely to include orbital servicing and payload development and manufacture.
Current wording
We are in the preliminary stages of developing our full space infrastructure offerings. These services are expected to grant customers access to cislunar space and the lunar surface at lower price points than previous lunar missions. We are also working to provide data transmission services at lunar distance to include far-side connectivity, along with ancillary services that are likely to include orbital servicing, earth reentry, and payload development and manufacture.
Previous wording
Our success will partially depend on our ability to expand our lunar mission operations in 2025 and beyond. We completed the first mission in February 2024 and completed our second mission in March 2025. We are working to establish a regular cadence of missions. We believe that this will provide our customers with proven and reliable cislunar access, with which to plan their future manifest. With binding agreements for additional launches as of December 31, 2024, we have $328.3 million in backlog, and we are in active discussions with numerous potential customers, including government agencies and private companies, to potentially add to our contracted revenue backlog.
Current wording
Our success will partially depend on our ability to expand our lunar mission operations and win government contracts in 2026 and beyond. We completed the first mission in February 2024 and completed our second mission in March 2025. With binding agreements for additional launches as of December 31, 2025, we have $213.1 million in contracted backlog, and we are in active discussions with numerous potential customers, including government agencies and private companies, to potentially add to our contracted revenue backlog.
Previous wording
Prior to commencing missions, we must complete internal integration activities as well as launch vehicle integration with our launch provider, SpaceX. Any delays to our targeted mission launch date or in commencing our missions, including due to congestion at the pad launch site or delays in obtaining various approvals or licenses, could adversely impact our results and growth plans. As we improve production efficiency and schedule reliability and reach our target of multiple missions per year manifested 2-3 years in advance, we expect to improve our market penetration, which we believe will lead to higher revenue from both volume and mission complexity as well as increased operating leverage.
Current wording
Prior to commencing missions, we must complete internal integration activities as well as launch vehicle integration with our launch provider, SpaceX. Any delays to our targeted mission launch date or in commencing our missions, including due to congestion at the pad launch site or delays in obtaining various approvals or licenses, could adversely impact our results and growth plans. As we improve production efficiency and schedule reliability and begin to launch our satellites for our lunar data network, we expect to improve our market penetration, which we believe will lead to higher revenue from both volume and mission complexity as well as increased operating leverage.
Previous wording
Our future growth is largely dependent on our ability to continue to capitalize on increased government spending and private investment in the space economy. U.S. federal government expenditures and private enterprise investment have fueled our growth in recent years, and it has resulted in our continued ability to secure increasingly valuable contracts for products and services in 2024. An increased focus on U.S. federal government spending could unfavorably impact the space exploration sector in the future. On January 20, 2025, President Donald J. Trump announced an executive order establishing the “Department of Government Efficiency” to maximize government efficiency and productivity. Pressures on and uncertainty surrounding the U.S. federal government’s budget and potential changes in budgetary priorities, could adversely affect the funding for individual programs and delay purchasing decisions by our customers. If our existing programs and project pursuits are not focused on the federal government’s higher priorities, our business, prospects, financial condition and operating results could be adversely affected.
Current wording
Our future growth is largely dependent on our ability to continue to capitalize on increased government spending and private investment in the space economy. U.S. federal government expenditures and private enterprise investment have fueled our growth in recent years, and it has resulted in our continued ability to secure increasingly valuable contracts for products and services. An increased focus on U.S. federal government spending could unfavorably impact the space exploration sector in the future. On January 20, 2025, President Donald J. Trump announced an executive order establishing the “Department of Government Efficiency” to maximize government efficiency and productivity. Pressures on and uncertainty surrounding the U.S. federal government’s budget and potential changes in budgetary priorities, could adversely affect the funding for individual programs and delay purchasing decisions by our customers. If our existing programs and project pursuits are not focused on the federal government’s higher priorities, our business, prospects, financial condition and operating results could be adversely affected.
Previous wording
We design, build, and test our landers, spacecraft and subsystems in-house and operate at the forefront of composite structures, liquid rocket engines, guidance, navigation and control software, precision landing and hazard avoidance software, and advanced manufacturing techniques. We believe the synergy of these technologies enables greater responsiveness to the commercial and government requirements for lunar exploration. To continue establishing market share and attracting customers, we plan to continue to make substantial investments in research and development for the continued enhancements of our landers, lunar data network, and other space systems. Over time, we expect our research and development expenditures to continue to grow on an absolute basis, but remain consistent or decrease as a percent of our total revenue as we expand our service offerings.
Current wording
We design, build, and test our landers, satellites, spacecraft and subsystems in-house and operate at the forefront of composite structures, liquid rocket engines, guidance, navigation and control software, precision landing and hazard avoidance software, and advanced manufacturing techniques. We believe the synergy of these technologies enables greater responsiveness to the commercial and government requirements for lunar exploration. To continue establishing market share and attracting customers, we plan to continue to make substantial investments in research and development for the continued enhancements of our landers, lunar data network, and other space systems. Over time, we expect our research and development expenditures to continue to grow on an absolute basis, but remain consistent or decrease as a percent of our total revenue as we expand our service offerings.
Previous wording
Cost of revenue (excluding depreciation) consists primarily of direct material and labor costs, launch services, manufacturing overhead, freight expense, and other personnel-related expenses, which include salaries, bonuses, benefits and stock-based compensation expense. We expect our cost of revenue to increase in absolute dollars in future periods as we sell more products and services. As we grow into our current capacity and execute on cost-optimization initiatives, we expect our cost of revenue as a percentage of revenue to decrease over time.
Current wording
Cost of revenue (excluding depreciation and amortization) consists primarily of direct material and labor costs, launch services, manufacturing overhead, freight expense, and other personnel-related expenses, which include salaries, bonuses, benefits and stock-based compensation expense. We expect our cost of revenue to increase in absolute dollars in future periods as we sell more products and services. As we grow into our current capacity and execute on cost-optimization initiatives, we expect our cost of revenue as a percentage of revenue to decrease over time.
Previous wording
Depreciation consists of the depreciation of tangible fixed assets for the relevant period based on the straight-line method over the useful life of the assets. Tangible fixed assets include property and equipment.
Current wording
Depreciation consists of the depreciation of tangible fixed assets for the relevant period based on the straight-line method over the useful life of the assets. Tangible fixed assets include property and equipment. Amortization consists of the amortization of finite-lived intangibles for the relevant period based on the straight-line method over the useful life of the assets. Our finite-lived intangible assets include customer relationships and developed technology.
Previous wording
General and administrative expense (excluding depreciation)
Current wording
General and administrative expense (excluding depreciation and amortization)
Previous wording
Selling, general and administrative expense (excluding depreciation) consist primarily of personnel-related expenses for our sales, marketing, supply chain, research and development (“R&D”), finance, legal, human resources and administrative personnel, as well as the costs of customer service, information technology, professional services, insurance, travel, allocated overhead and other marketing, communications and administrative expenses. R&D represents costs incurred for the Company’s continued enhancements of our landers, lunar data network, other space systems, and also for the development and innovation of our proprietary technology platforms. R&D costs primarily include engineering personnel salaries and benefits, subcontractor costs, materials and supplies, and other related expenses. We also expect to invest in our corporate organization and incur additional expenses associated with transitioning to, and operating as, a public company, including increased legal and accounting costs, investor relations costs, higher insurance premiums and compliance costs. As a result, we expect that selling, general and administrative expenses will increase in absolute dollars in future periods as a percentage of total revenue.
Current wording
Selling, general and administrative expense (excluding depreciation and amortization) consist primarily of personnel-related expenses for our sales, marketing, supply chain, finance, legal, human resources and administrative personnel, as well as the costs of customer service, information technology, professional services, insurance, travel, allocated overhead and other marketing, communications and administrative expenses. We also expect to invest in our corporate organization and incur additional expenses associated with transitioning to, and operating as, a public company, including increased legal and accounting costs, investor relations costs, higher insurance premiums and compliance costs. As a result, we expect that selling, general and administrative expenses will increase in absolute dollars in future periods as a percentage of total revenue.
Previous wording
Interest income (expense), net consists of interest income earned on cash and cash equivalents and short-term investment balances held by us in interest bearing demand deposit accounts. Interest expense is incurred primarily on long-term debt and credit support arrangements.
Current wording
Interest income consists of interest income earned on cash and cash equivalents and short-term investment balances held by us in interest bearing demand deposit accounts.
Previous wording
Earn Out Units are classified as liabilities transactions at initial issuance which were offset against paid-in capital as of the closing of the Business Combination. At each period end, the Earn Out Units are remeasured to their fair value with the changes during that period recognized in other income (expense) on the consolidated statement of operations. Upon issuance and release of the shares after each Triggering Event is met, the related Earn Out Units will be remeasured to fair value at that time with the changes recognized in other income (expense), and such Earn Out Units will be reclassed to stockholders’ equity (deficit) on the consolidated balance sheet. See Notes 2 and 11 of the consolidated financial statements for additional information on the earn-out liabilities.
Current wording
Earn Out Units are classified as liabilities transactions at initial issuance which were offset against paid-in capital as of the closing of the Business Combination. At each period end, the Earn Out Units are remeasured to their fair value with the changes during that period recognized in other income (expense) on the consolidated statement of operations. Upon issuance and release of the shares after each Triggering Event is met, the related Earn Out Units will be remeasured to fair value at that time with the changes recognized in other income (expense), and such Earn Out Units will be reclassed to stockholders’ equity (deficit) on the consolidated balance sheet. See Notes 2 and 13 of the consolidated financial statements for additional information on the earn-out liabilities.
Previous wording
In connection with the Private Placement, Warrant Exercise Agreement, and the Bridge Loan Conversion, the Company has issued warrants which are classified as liabilities on our balance sheet. At each period end, the warrants are remeasured to their fair value with the changes during the period recognized in other income (expense) on our consolidated statement of operations. See Notes 9 and 11 of the consolidated financial statements for additional information on the warrant liabilities.
Current wording
In connection with the Private Placement, Warrant Exercise Agreement, and the Bridge Loan Conversion, the Company has issued warrants which are classified as liabilities on our balance sheet. At each period end, the warrants are remeasured to their fair value with the changes during the period recognized in other income (expense) on our consolidated statement of operations. See Notes 11 and 13 of the consolidated financial statements for additional information on the warrant liabilities.
Previous wording
In connection with the Private Placement, Warrant Exercise Agreement, and the Bridge Loan Conversion as discussed in Notes 9 and 11 to the consolidated financial statements, the Company issued warrants and recognized a loss on the issuance as the fair value of the securities exceeded the gross proceeds at the issuance date. The Company evaluated the terms of the warrants and determined they meet the criteria in ASC 815, “Derivatives and Hedging”, to be classified as a derivative liability, initially measured at fair value. The subsequent changes in fair value are recognized in earnings in other income (expense) on the consolidated statement of operations.
Current wording
In connection with the Private Placement, Warrant Exercise Agreement, and the Bridge Loan Conversion as discussed in Notes 11 and 13 to the consolidated financial statements, the Company issued warrants and recognized a loss on the issuance as the fair value of the securities exceeded the gross proceeds at the issuance date. The Company evaluated the terms of the warrants and determined they meet the criteria in ASC 815, “Derivatives and Hedging”, to be classified as a derivative liability, initially measured at fair value. The subsequent changes in fair value are recognized in earnings in other income (expense) on the consolidated statement of operations.
Previous wording
Other (expense) income, net primarily consists of immaterial miscellaneous income sources.
Current wording
Other income, net primarily consists of immaterial miscellaneous income sources.
Previous wording
The financial results of Intuitive Machines, LLC were consolidated into Intuitive Machines, Inc. for the periods February 13, 2023 forward and resulted in the allocation of approximately 35.5% of Intuitive Machines, LLC’s net loss to noncontrolling interests.
Current wording
The financial results of Intuitive Machines, LLC were consolidated into Intuitive Machines, Inc. for the periods February 13, 2023 forward and resulted in the allocation of approximately 32.6% of Intuitive Machines, LLC’s net loss to noncontrolling interests.
Previous wording
Revenue for the years ended December 31, 2024 and 2023 was primarily driven by NASA and other commercial payload contracts associated with the IM-1, IM-2 and IM-3 lunar payload missions as well as the OMES III contract where we provide engineering services to the Landsat Servicing mission at the Goddard Space Flight Center in Maryland. Additionally, we earned revenue from several other general and feasibility study engineering contracts for the year ended December 31, 2024, including the JETSON Low Power, LTV and NSN contract awards.
Current wording
Revenue for the years ended December 31, 2025 and 2024 was primarily driven by NASA and other commercial payload contracts associated with our lunar payload missions as well as the OMES III contract where we provide engineering services to the Landsat Servicing mission at the Goddard Space Flight Center in Maryland, the NSN contract for the development of a satellite communications and navigation network, and the LTV contract leading the development of the Moon RACER Lunar Terrain Vehicle.
Previous wording
•The initial NASA payload contract for the IM-3 mission was awarded in November 2021 with an initial targeted mission launch date no later than June 2024 under our current contract with NASA. Total IM-3 mission estimated revenue under fixed-priced contracts is $93.0 million (excluding constrained revenue of $9.7 million) as of December 31, 2024 as compared to $80.9 million as of December 31, 2023. The increase in total mission estimated contract revenue is mostly due to a task order modification with NASA to identify its complement of payloads and extend the IM-3 mission timeline to no later than June 2026. The task order modification increased estimated contract revenue by approximately $9.0 million.
Current wording
•The initial NASA payload contract for the IM-3 mission was awarded in November 2021 with an initial targeted mission launch date no later than June 2024. Total IM-3 mission estimated revenue under fixed-priced contracts is $91.3 million (excluding constrained revenue of $9.7 million) as of December 31, 2025 as compared to $93.0 million as of December 31, 2024. The IM-3 mission timeline runs through March 2027.
Previous wording
•The initial NASA payload contract for the IM-4 mission was awarded in August 2024 with an initial targeted mission launch date no later than August 2028. Total IM-4 mission estimated revenue under fixed-priced contracts is $105.2 million (excluding constrained revenue of $11.7 million) as of December 31, 2024.
Current wording
•The initial NASA payload contract for the IM-4 mission was awarded in August 2024 with an initial targeted mission launch date no later than August 2028, although we expect the mission launch to occur during the second half of 2027. Total IM-4 mission estimated revenue under fixed-priced contracts is $123.7 million (excluding constrained revenue of $16.2 million) as of December 31, 2025.
Previous wording
During the third quarter of 2024, management determined that certain assets under development by a third party subcontractor were not in compliance according to the contract. Management concluded the carrying cost of these assets was not recoverable and recorded an impairment charge of approximately $5.0 million including capitalized interest of $0.5 million, in our consolidated statements of operations for the year ended December 31, 2024. See Note 4 to the consolidated financial statements for additional information.
Current wording
During the third quarter of 2024, management determined that certain assets under development by a third party subcontractor were not in compliance according to the contract. Management concluded the carrying cost of these assets was not recoverable and recorded an impairment charge of approximately $5.0 million including capitalized interest of $0.5 million, in our consolidated statements of operations for the year ended December 31, 2024. No impairment charges were recorded for during the year ended December 31, 2025 related to these assets or other long-lived assets. See Note 5 to the consolidated financial statements for additional information.
Previous wording
For the years ended December 31, 2024 and 2023, we recognized a combined U.S. federal and state expense for income taxes of $37 thousand and $40 thousand, respectively. The effective combined U.S. federal and state income tax rates were (0.01%) and 0.39% for the years ended December 31, 2024 and 2023, respectively. For year ended December 31, 2024, our effective tax rate differed from the statutory rate of 21% primarily due to deferred taxes for which no benefit is being recorded and losses attributable to noncontrolling interest unitholders that are taxable on their respective share of taxable income. For the year ended December 31, 2023, our effective tax rate differed from the statutory rate primarily due to Intuitive Machines, LLC's status as a partnership for U.S. federal income tax purposes.
Current wording
For the years ended December 31, 2025 and 2024, we recognized a combined U.S. federal and state expense for income taxes of $4.0 million and $37 thousand, respectively. The effective combined U.S. federal and state income tax rates were (3.85%) and (0.01%) for the years ended December 31, 2025 and 2024, respectively. For years ended December 31, 2025, our effective tax rate differed from the statutory rate of 21% primarily due to deferred taxes for which no benefit is being recorded and losses attributable to noncontrolling interest unitholders that are taxable on their respective share of taxable income and the deferred tax consequence of our acquisition and subsequent contribution of KinetX assets into Intuitive Machines, LLC. For year ended December 31, 2024, our effective tax rate differed from the statutory rate of 21% primarily due to deferred taxes for which no benefit is being recorded and losses attributable to noncontrolling interest unitholders that are taxable on their respective share of taxable income.
Previous wording
We define backlog as our total estimate of the revenue we expect to realize in the future as a result of performing work on awarded contracts, less the amount of revenue previously recognized. We monitor our backlog because we believe it is a forward-looking indicator of potential sales which can be helpful to investors in evaluating the performance of our business and identifying trends over time. We generally include total expected revenue in backlog when a contract is awarded by the customer under a legally binding agreement. Our backlog does not include any estimate of future potential work orders that might be awarded under government-wide acquisition contracts, agency-specific indefinite delivery/indefinite quantity contracts or other multiple-award contract vehicles, nor does it include option periods that have not been exercised by the customer. Due to government procurement rules, in certain cases revenue included in backlog is subject to budget appropriation or other contract cancellation clauses. Nearly all contracts allow customers to terminate the agreement at any time for convenience. If any of our contracts with firm orders were to be terminated, our backlog would be reduced by the expected value of the unfilled orders of such contracts. Consequently, our backlog may differ from actual revenue recognized in our financial statements.
Current wording
We define backlog as our total estimate of the revenue we expect to realize in the future as a result of performing work on awarded contracts, less the amount of revenue previously recognized. Although backlog is not a guarantee of future revenue, we monitor backlog because it provides insight into the potential timing and volume of future work on awarded contracts, which can be helpful to investors in evaluating the performance of our business and identifying trends over time. We generally include total expected revenue in backlog when a contract is awarded by the customer under a legally binding agreement. Our backlog does not include any estimate of future potential work orders that might be awarded under government-wide acquisition contracts, agency-specific indefinite delivery/indefinite quantity contracts or other multiple-award contract vehicles, nor does it include option periods that have not been exercised by the customer. Due to government procurement rules, in certain cases revenue included in backlog is subject to budget appropriation or other contract cancellation clauses. Nearly all contracts allow customers to terminate the agreement at any time for convenience.
Previous wording
Orders comprising backlog as of a given balance sheet date are typically invoicedin subsequent periods. As of December 31, 2024, we expect to recognize approximately 60% to 65% of our backlog in 2025, approximately 15% to 20% in 2026 and the remaining thereafter. Our backlog could experience volatility between periods, including as a result of customer order volumes and the speed of our fulfillment, which in turn may be impacted by the nature of products and services ordered, the amount of inventory on hand to satisfy orders and the necessary development and manufacturing lead time required to satisfy certain orders.
Current wording
Orders comprising backlog as of a given balance sheet date are typically invoicedin subsequent periods. As of December 31, 2025, based on current contract schedules, we expect to recognize approximately 60% to 65% of our backlog in 2026, approximately 35% to 40% in 2027 and the remaining thereafter. Our backlog could experience volatility between periods, including as a result of customer order volumes and the speed of our fulfillment, which in turn may be impacted by the nature of products and services ordered, the amount of inventory on hand to satisfy orders and the necessary development and manufacturing lead time required to satisfy certain orders.
Previous wording
As of December 31, 2024, our backlog of $328.3 million exceeded our remaining performance obligations of $168.7 million as reported in Note 3 to our consolidated financial statements. The difference of $159.6 million was primarily due $66.0 million of variable consideration associated with constrained revenue and$93.6 million in backlog related to the funded value of the OMES III project and various other time and materials service contracts where revenue is recognized when services are performed and contractually billable and therefore not included in remaining performance obligations.
Current wording
As of December 31, 2025, our backlog of $213.1 million exceeded our remaining performance obligations of $102.8 million as reported in Note 4 to our consolidated financial statements. The difference of $110.3 million was primarily due to $39.3 million of variable consideration associated with constrained revenue and$71.0 million in backlog related to the funded value of the OMES III contract, the NSN contract, and various other contracts where revenue is recognized when services are performed and contractually billable and therefore not included in remaining performance obligations.
Previous wording
Adjusted EBITDA is a key performance measure that our management team uses to assess our operating performance. We calculate Adjusted EBITDA as net income (loss) excluding results from non-operating sources including interest income, interest expense, share based compensation, change in fair value instruments, gain or loss on issuance of securities, other income/expense, depreciation, impairment of property and equipment, and provision for income taxes.
Current wording
Adjusted EBITDA is a key performance measure that our management team uses to assess our operating performance. We calculate Adjusted EBITDA as net income (loss) excluding results from non-operating sources including interest income, interest expense, transaction and integration costs related to acquisitions, share based compensation, change in fair value instruments, gain or loss on issuance of securities, other income/expense, depreciation, impairment of property and equipment, and provision for income taxes.
Previous wording
•Adjusted EBITDA does not reflect interest income, interest expense or other non-operating gains and losses, which may represent an increase to or reduction in cash available to us;
Current wording
•Adjusted EBITDA does not reflect interest income, interest expense, transaction and integration costs related to acquisitions or other non-operating gains and losses, which may represent an increase to or reduction in cash available to us;
Previous wording
•Adjusted EBITDA does not consider the impact of change in fair value of SAFE Agreements, change in fair value of earn-out liabilities, change in fair value of warrant liabilities, loss on issuance of securities, or impairment of property and equipment, that we do not consider to be routine in nature for the ongoing financial performance of our business;
Current wording
•Adjusted EBITDA does not consider the impact of change in fair value of SAFE Agreements, change in fair value of earn-out liabilities, change in fair value of warrant liabilities, change in fair value of contingent consideration liabilities, loss on issuance of securities, or impairment of property and equipment, that we do not consider to be routine in nature for the ongoing financial performance of our business;
Previous wording
Since inception, we have funded our operations through internally generated cash on hand, proceeds from sales of our capital stock, including the execution of SAFE Agreements, our At The Market Offering Program (the “ATM Program”) with Cantor (as described below), our 2024 Offering (as described below), proceeds from warrant exercises, and proceeds from the issuance of bank debt. We assess our liquidity in terms of our ability to generate adequate amounts of cash to meet current and future needs. Our expected primary uses of cash on a short and long-term basis are for working capital requirements, capital expenditures, general corporate purposes, including operations, research and development and potential mergers and acquisitions. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects. Our capital expenditures are primarily related to machinery and equipment, computers and software, and leasehold improvements.
Current wording
Since inception, we have funded our operations through internally generated cash on hand, proceeds from sales of our capital stock, proceeds from warrant exercises, and our proceeds from the issuance of bank debt and Convertible Notes. We assess our liquidity in terms of our ability to generate adequate amounts of cash to meet current and future needs. Our expected primary uses of cash on a short and long-term basis are for working capital requirements, general corporate purposes, and capital expenditures as well as research and development efforts and potential mergers and acquisitions. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects. Our capital expenditures are primarily related to machinery and equipment, computers and software, and leasehold improvements for general corporate and operational purposes. We expect construction in progress to continue to increase as we develop data relay satellites and ground networks associated with our Data Transmission Services business.
Previous wording
As further described in Note 17 - Subsequent Events, the Company announced on February 4, 2025, the redemption of all of its outstanding warrants (the Public Warrants and Private Warrants as defined in Note 9, collectively the “Warrants”) and Warrants remaining unexercised as of March 6, 2025 (the “Redemption Date”) were redeemed by the Company for $0.01 per Warrant. During the first quarter of 2025, the Company received approximately $176.6 million in gross proceeds from the Warrant exercises of 15,358,229. On the Redemption Date, a total of 6,571,724 Warrants remained unexercised and the Company redeemed those Warrants for an aggregate redemption price of $66 thousand. In connection with the Warrant Redemption, a warrant holder agreed to exercise 1,800,000 of the Public Warrants, and the Company agreed to repurchase 941,080 shares of the Company’s Class A Common Stock for an aggregate purchase price of $20.7 million.
Current wording
On February 4, 2025 the Company announced the redemption of all of its outstanding warrants (the Public Warrants and Private Warrants as defined in Note 11, collectively the “Warrants”) and Warrants remaining unexercised as of March 6, 2025 (the “Redemption Date”) were redeemed by the Company for $0.01 per Warrant. During the first quarter of 2025, the Company received approximately $176.6 million in gross proceeds from the exercise of 15,358,229 Warrants. On the Redemption Date, a total of 6,571,724 Warrants remained unexercised which were redeemed by the Company for an aggregate redemption price of $66 thousand. See Note 11 – Public and Private Warrants for additional information.
Previous wording
Management believes that the cash and cash equivalents as of December 31, 2024 and the additional liquidity provided by subsequent equity transactions, will be sufficient to fund the short-term liquidity needs and the execution of the business plan through at least the twelve-month period from the date the financial statements are issued.
Current wording
Management believes that the cash and cash equivalents as of December 31, 2025 and the liquidity provided from the proceeds of the issuance of securities pursuant to the Securities Purchase Agreement and the issuance of the Convertible Notes, will be sufficient to fund the short-term liquidity needs and the execution of the business plan through at least the twelve-month period from the date the financial statements are issued.
Previous wording
During the year ended December 31, 2024, our operating activities used $57.6 millionof net cash as compared to$45.3 million of net cash used during the year ended December 31, 2023. Changes in operating assets and liabilities which consist primarily of working capital balances for our projects may vary and are impacted by the stage of completion and contractual terms of projects. The primary components of our working capital accounts are trade accounts receivable, contract assets, accounts payable, and contract liabilities.
Current wording
During the year ended December 31, 2025, our operating activities used $14.3 million of net cash as compared to $57.6 million of net cash used during the year ended December 31, 2024. Changes in operating assets and liabilities, which consist primarily of working capital balances for our projects, may vary and are impacted by the stage of completion and contractual terms of projects. The primary components of our working capital accounts are trade accounts receivable, contract assets, accounts payable, and contract liabilities.
Previous wording
During the year ended December 31, 2024, financing activities provided $272.8 million of net cash as compared to $53.9 million of net cash provided during the year ended December 31, 2023.
Current wording
During the year ended December 31, 2025, financing activities provided $446.6 million of net cash as compared to $272.8 million of net cash provided during the year ended December 31, 2024.
Previous wording
We believe that the following accounting policies involve a high degree of judgement and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of our operations. Significant accounting policies employed by us, including the use of estimates, are presented in Note 2 - Summary of Significant Accounting Policies to our consolidated financial statements included elsewhere in this Annual Report.
Current wording
We believe that the following accounting policies involve a high degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of our operations. Significant accounting policies employed by us, including the use of estimates, are presented in Note 2 - Summary of Significant Accounting Policies to our consolidated financial statements included elsewhere in this Annual Report.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
If any of our contracts with firm orders were to be terminated, our backlog would be reduced by the expected value of the unfilled orders of such contracts. Consequently, our backlog may differ from actual revenue recognized in our financial statements.
Current report — wording carried from elsewhere
During 2025, our financing activities primarily included$334.6 million in net proceeds from the issuance Convertible Notes, $176.6 million in proceeds from the exercise of warrants, slightly offset by $36.8 million for the purchase of Capped Calls transactions associated with the issuance of the Convertible Notes, $20.7 million for share repurchase, $4.8 million in net activity related to our share-based awards, and $2.2 million in distributions to noncontrolling interests.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
While rising costs and other inflationary pressures have not had a material impact on our business to date, we are monitoring the situation and assessing its impact on our business, including to our partners and customers.
Previous report — wording carried elsewhere
Change in fair value of SAFE Agreements
Previous report — wording carried elsewhere
General and administrative expense (excluding depreciation)
Previous report — wording carried elsewhere
Cash Flows for the years ended December 31, 2024 and 2023