Intuitive Machines Inc
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
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-Q
Period ended 2024-03-31; filed 2024-05-14.
0001844452-24-000070
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of Intuitive MachinesCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0001844452-24-000094
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of Intuitive MachinesThe 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 181 previous paragraphs and 185 current paragraphs.
125 unchanged; 42 reworded; 16 added; 12 removed; 2 previous and 2 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 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 (16)
Current report
As of June 30, 2024, the Company ceased being a controlled company within the meaning of the Nasdaq. We were not relying on any Nasdaq corporate governance exemptions for controlled company status prior to June 30, 2024.
Current report
Since late 2023, we have been performing a more significant amount of work on cost-reimbursable contracts such as OMES III. Under cost-reimbursable contracts, the price is generally variable based upon our actual allowable costs incurred for materials, equipment, reimbursable labor hours, overhead and G&A expenses. Profit on cost-reimbursable contracts may be in the form of a fixed fee or a mark-up applied to costs incurred, or a combination of the two. The fee may also be an incentive fee based on performance indicators, milestones or targets and can be based on customer discretion or in the form of an award fee determined based on customer evaluation of the Company's performance against contractual criteria. Cost-reimbursable contracts are generally less risky because the owner/customer retains many of the project risks, however it generally requires us to use our best efforts to accomplish the scope of the work within a specified time and budget.
Current report
Cost-reimbursable contracts with the U.S. government are generally subject to the FAR and are competitively priced based on estimated or actual costs of providing the contractual goods or services. The FAR provides guidance on types of costs that are allowable in establishing prices for goods and services provided to the U.S. government and its agencies. Pricing for non-U.S. government agencies and commercial customers is based on specific negotiations with each customer.
Current report
Interest income (expense), net
Current report
Gain (loss) on issuance of securities
Current report
Other income (expense), net
Current report
Income tax benefit
Current report
Total revenue increased by $23.4 million, or 130%, for the three months ended June 30, 2024 compared to the same period in 2023, largely driven by the revenue from the OMES III contract execution which began in the fourth quarter of 2023 as further discussed below and was partially offset by decreases in revenue across our NASA and other commercial payload contracts associated with the IM lunar payload missions.
Current report
The IM-1 mission completed in February 2024, and no revenue was recognized for the three months ended June 30, 2024 as compared to $4.3 million for the same period in 2023. Revenue on the IM-2 mission decreased by $4.7 million for the three months ended June 30, 2024 compared to the same period of 2023 and was primarily driven by unfavorable adjustments resulting from task order modifications to change the mission targeted landing site and extension of the targeted mission launch window to early 2025 as discussed above. Revenue from the IM-3 mission decreased by $8.3 million for the three months ended June 30, 2024 compared to the same period in 2023 as a result of unfavorable adjustments from pending task order modifications extending the targeted mission launch window to late 2025.
Current report
Total revenue increased by $78.2 million, or 216%, for the six months ended June 30, 2024 compared to the same period in 2023 and was substantially driven by revenue from the OMES III contract execution which began in the fourth quarter of 2023 as further discussed below.
Current report
Other contract revenues increased approximately $1.6 million and $2.5 million for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023 primarily as a result of new contracts, including the Jetson Low Power project awarded in the fourth quarter of 2023 and the Lunar Terrain Vehicle Services design project in the second quarter of 2024 as well as several other contracts partially offset by the completion of the initial phase of the fission surface power contract in the third quarter of 2023.
Current report
Total cost of revenue increased by $34.6 million, or 154%, for the three months ended June 30, 2024 compared to the same period in 2023. The IM-1 mission was completed in February 2024, and no cost of revenue was incurred for the three months ended June 30, 2024 compared to $4.0 million for the same period in 2023. On the IM-2 mission, cost of revenue increased by approximately $0.7 million to $8.2 million for the three months ended June 30, 2024 from $7.5 million in the same period in 2023. IM-3 mission cost of revenue decreased by approximately $4.7 million to $2.7 million for the three months ended June 30, 2024 compared to $7.4 million in the same period in 2023 due to lower activity on the mission.
Current report
For the six months ended June 30, 2024 compared to the same periods in 2023, the $12.0 million increase was driven by higher share-based compensation expense of$4.7 million, employee compensation and benefits expense of$2.4 million, bids and proposals expense of$1.5 million, professional services of $1.6 million primarily driven by accounting and legal fees, rent expense of $1.4 million primarily driven by the move to our new corporate headquarters in late 2023, and various other administrative costs of$0.4 million.
Current report
Other income (expense), net
Current report
Total other income (expense), net favorable change of $15.7 million for the three months ended June 30, 2024 compared to the same period in 2023 was primarily due to favorable change in fair value of warrant liabilities of $21.0 million, gain on issuance of securities of $0.6 million, slightly offset by unfavorable change in fair value of the earn-out liabilities of $6.6 million.
Removed paragraphs (12)
Previous report
Warrant Transactions
Previous report
On January 10, 2024, the Company entered into a Warrant Exercise Agreement with an existing investor to exercise in full the Initial Series B Warrant to purchase up to an aggregate 4,705,883 shares of Class A Common Stock. In consideration for the immediate and full exercise of the Initial Series B Warrant, the existing investor received (i) a new unregistered Series A Common Stock Purchase Warrant to purchase up to an aggregate of 4,705,883 shares of Class A Common Stock with an exercise price of $2.75 per share and a term of 5.5 years (the “New Series A Warrant”) and (ii) a new unregistered Series B Common Stock Purchase Warrant to purchase up to an aggregate of 4,705,883 shares of Class A Common Stock with an exercise price of $2.75 per share and a term of 18 months (the “New Series B Warrant”) in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933. In connection with the Warrant Exercise Agreement, the Company also agreed to reduce the exercise price of the Initial Series B Warrant from $4.75 to $2.50 per share and reduced the exercise price of the Initial Series A Warrant from $4.75 to $2.75 per share. The gross proceeds to the Company from the exercise of the Initial Series B Warrant was approximately $11.8 million.
Previous report
In a series of transactions during February 2024, the investor exercised in full the Initial Series A Warrant, the New Series A Warrant, and the New Series B Warrant for an aggregate of 14,117,649 share of Class A Common Stock, which provided an additional $38.8 million of gross proceeds to the Company.
Previous report
Series A Preferred Stock Conversion
Previous report
As a result of the Warrant Exercise Agreement on January 10, 2024 in conjunction with the Warrant Transactions further discussed in Note 8 and in accordance with the Certificate of Designation, the Series A Preferred Stock conversion price was further reduced to $3.00 per share. In a series of notifications to the Company during February 2024, the registered holder of 21,000 shares of Series A Preferred Stock elected to convert all of its Series A Preferred Stock holdings into Class A Common Stock at a conversion price of $3.00 per share. The Company issued 7,738,743 shares of Class A Common Stock as a result of the conversion.
Previous report
Interest expense, net
Previous report
Loss on issuance of securities
Previous report
Other income, net
Previous report
Income tax expense
Previous report
Other expense, net
Previous report
Income tax expense
Reworded paragraphs (42)
Previous wording
We are currently working to provide access to the lunar surface and collect and transmit cislunar data for science, technology, and infrastructure. 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 with a first mover advantage, as evidenced by two Commercial Lunar Payload Services (“CLPS”) awards to date as of March 31, 2024. On February 22, 2024, Intuitive Machines’ Nova-C lander became the first U.S. vehicle to softly land on the lunar surface since 1972 and landed the vehicle further south than any vehicle in the world has ever soft-landed on the Moon. Our Nova-C lander on the IM-1 mission carried approximately 100 kilograms of payloads and executed numerous experiments and technology demonstrations at the lunar surface near the south pole. Our goal is to follow the successful IM-1 mission with IM-2, which will continue to execute experiments and technology demonstrations at the Shackleton Connecting Ridge at the lunar south pole, and IM-3, our third CLPS award, which will land at Reiner Gamma. These missions, along with additional expeditions, are in partnership with NASA, Nokia Corporation, Columbia Sportswear Company, Aegis Aerospace, Inc. and other commercial players. Intuitive Machines offers its customers the flexibility needed to pioneer a thriving, diverse lunar economy and to enable a permanent presence on the Moon.
Current wording
We are currently working to provide access to the lunar surface and collect and transmit cislunar data for science, technology, and infrastructure. 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 with a first mover advantage, as evidenced by two remaining Commercial Lunar Payload Services (“CLPS”) awards as of June 30, 2024. On February 22, 2024, Intuitive Machines’ Nova-C lander became the first U.S. vehicle to softly land on the lunar surface since 1972 and landed the vehicle further south than any vehicle in the world has ever soft-landed on the Moon. We believe this February landing validates our ability to provide the three service pillars required to commercialize a celestial body: delivery, data & communications, and autonomous operations in space. Our Nova-C lander on the IM-1 mission carried approximately 100 kilograms of payloads and executed numerous experiments and technology demonstrations at the lunar surface near the south pole. Our goal is to follow the successful IM-1 mission with IM-2, which will continue to execute experiments and technology demonstrations at the Shackleton Connecting Ridge at the lunar south pole, and IM-3, our third CLPS award, which will land at Reiner Gamma. These missions, along with additional expeditions, are in partnership with NASA, Nokia Corporation, Columbia Sportswear Company, Aegis Aerospace, Inc. and other commercial players. Intuitive Machines empowers its customers to achieve their ambitious visions and commercial goals in space through seamless collaboration with our robust service pillars.
Previous wording
We primarily generate revenue through our contracts with customers of our lunar access services and by collecting and transmitting cislunar data for science, technology and infrastructure in our Space Products and Infrastructure services. 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.
Current wording
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 in our Space Products and Infrastructure services. 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.
Previous wording
Our core technologies underpin our capabilities in four business units: Lunar Access Services, Orbital Services, Lunar Data Services and Space Products and Infrastructure. Under Accounting Standards Codification (“ASC”) 280 “Segment Reporting,” we concluded that our business units operate as one reportable segment. See our Segment Reporting disclosure under Note 2 in our condensed consolidated financial statements for further discussion on our reportable segment.
Current wording
We operate under three service pillars which we believe are required to commercialize a celestial body: delivery, data & communications, and autonomous operations in space. These pillars are the backdrop to our four business units: Lunar Access Services, Orbital Services, Lunar Data Services and Space Products and Infrastructure. Under Accounting Standards Codification (“ASC”) 280 “Segment Reporting,” we concluded that our business units operate as one reportable segment. See our Segment Reporting disclosure under Note 2 in our condensed consolidated financial statements for further discussion on our reportable segment.
Previous wording
Our Lunar Access Services business provides reliable and affordable means for governments, companies and individuals to explore and place objects in cislunar space or on the lunar surface. We have developed a complete lunar program that includes mission control, the Nova-C lander, a space-to-ground communications network, and a series of launch vehicle contracts with SpaceX. As of March 31, 2024, we had two missions on the flight manifest, with plans to increase the frequency and complexity of the missions over time. On February 22, 2024, our Nova-C lander on the IM-1 mission became the first U.S. vehicle to softly land on the lunar surface since 1972 and landed the vehicle further south than any vehicle in the world has ever soft-landed on the Moon.
Current wording
Our Lunar Access Services business provides reliable and affordable means for governments, companies and individuals to explore and place objects in cislunar space or on the lunar surface. We have developed a complete lunar program that includes mission control, the Nova-C lander, a space-to-ground communications network, and a series of launch vehicle contracts with SpaceX. As of June 30, 2024, we had two remaining missions on the flight manifest, with plans to increase the frequency and complexity of the missions over time. On February 22, 2024, our Nova-C lander on the IM-1 mission became the first U.S. vehicle to softly land on the lunar surface since 1972 and landed the vehicle further south than any vehicle in the world has ever soft-landed on the Moon.
Previous wording
Our ability to commence and expand spaceflight mission operations
Current wording
Our ability to expand spaceflight mission operations
Previous wording
Our success will depend in large part on our ability to commence and expand our lunar mission operations in 2024 and beyond. We completed our first mission in February 2024 and we are on track to complete the two additional funded missions with a goal of establishing a regular cadence of multiple missions per year of increasing size and complexity by late 2025. This will provide our customers with proven and reliable cislunar access, with which to plan their future manifest. With binding agreements for 2 launches as of March 31, 2024, we have $222.4 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.
Current wording
Our success will depend in large part on our ability to expand our lunar mission operations in 2024 and beyond. We completed our first mission in February 2024 and we are on track to complete the two additional funded missions with a goal of establishing a regular cadence of multiple missions per year of increasing size and complexity by late 2025. This will provide our customers with proven and reliable cislunar access, with which to plan their future manifest. With binding agreements for two additional launches as of June 30, 2024, we have $213.0 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.
Previous wording
We expect to make significant investments in our lunar and data programs in the short term. Although we believe that our financial resources, including the proceeds of the Business Combination and the subsequent Private Placement, will be sufficient to meet our capital needs in the short term, our timeline and budgeted costs for these offerings are subject to substantial uncertainty, including due to compliance requirements of U.S. federal export control laws and applicable foreign and local regulations, the impact of political and economic conditions, and the need to identify opportunities and negotiate long-term agreements with customers for these services, among other factors. Our business may not generate sufficient funds, and we may otherwise be unable to maintain sufficient cash reserves to pay any additional indebtedness that we may incur.
Current wording
We expect to make significant investments in our lunar and data programs in the short term. Although we believe that our financial resources, will be sufficient to meet our capital needs in the short term, our timeline and budgeted costs for these offerings are subject to substantial uncertainty, including due to compliance requirements of U.S. federal export control laws and applicable foreign and local regulations, the impact of political and economic conditions, and the need to identify opportunities and negotiate long-term agreements with customers for these services, among other factors. Our business may not generate sufficient funds, and we may otherwise be unable to maintain sufficient cash reserves to pay any additional indebtedness that we may incur.
Previous wording
We perform work under contracts that broadly consist of fixed-price, cost-reimbursable, time-and-materials or a combination of the three. Pricing for all customers is based on specific negotiations with each customer. For a description of our revenue recognition policies, see the section titled “Critical Accounting Policies and Estimates.” A small portion of our revenue is generated from engineering services which are time-and-material type contracts. Going forward, cost-reimbursable contracts may constitute a material portion of our revenue.
Current wording
We perform work under contracts that broadly consist of fixed-price, cost-reimbursable, time-and-materials or a combination of the three. Pricing for all customers is based on specific negotiations with each customer. For a description of our revenue recognition policies, see the section titled “Critical Accounting Policies and Estimates.”
Previous wording
Most of our revenue is derived from long-term contracts for the delivery of payloads to the lunar surface. In order to satisfy these contracts, we undertake the engineering for the research, design, development, manufacturing, integration and sustainment of advanced technology space systems. The integration of these technologies and systems lead to an organic and integrated capability to provide lunar access on a commercial services basis. Individual contracts are aggregated by mission (e.g., IM-1, IM-2, IM-3) for management purposes. Revenue is measured based on the amount of consideration specified in a contract with the customer.
Current wording
Historically, most of our revenue has been derived from fixed-price, long-term contracts for the delivery of payloads to the lunar surface. In order to satisfy these contracts, we undertake the engineering for the research, design, development, manufacturing, integration and sustainment of advanced technology space systems. The integration of these technologies and systems lead to an organic and integrated capability to provide lunar access on a commercial services basis. Individual contracts are aggregated by mission (e.g., IM-1, IM-2, IM-3) for management purposes. Revenue is measured based on the amount of consideration specified in a contract with the customer.
Previous wording
In connection with the Private Placement and Warrant Exercise Agreement, 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 condensed consolidated statement of operations. See Notes 8 and 10 of the condensed 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 condensed consolidated statement of operations. See Notes 8 and 10 of the condensed consolidated financial statements for additional information on the warrant liabilities.
Previous wording
In connection with the Private Placement and Warrant Exercise Agreement, as discussed in Notes 8 and 10 to the condensed 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, the Company has discussed in Notes 8 and 10 to the condensed 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 condensed consolidated statement of operations.
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 58.0% 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 51.9% of Intuitive Machines, LLC’s net loss to noncontrolling interests.
Previous wording
The following table sets forth information regarding our consolidated results of operations for the three months ended March 31, 2024 compared to the three months ended March 31, 2023.
Current wording
The following table sets forth information regarding our consolidated results of operations for the three months ended June 30, 2024 compared to the three months ended June 30, 2023, and for the six months ended June 30, 2024 compared to the six months ended June 30, 2023.
Previous wording
Revenue for the three months ended March 31, 2024 and 2023 was primarily driven by NASA under the 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.
Current wording
Revenue for the three and six months ended June 30, 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.
Previous wording
The following provides a summary of the material contracts and estimated mission launch dates for each lunar payload mission impacting our results of operations:
Current wording
The following provides a summary of the significant contracts and estimated mission launch dates for each lunar payload mission impacting our results of operations:
Previous wording
•The NASA payload contract for the IM-1 mission was awarded in June 2019 and was completed in February 2024. As a result of the successful landing on the lunar surface, previously constrained revenue of approximately $12.3 million was released which increased the total IM-1 mission contract revenue under NASA and other commercial fixed-priced contracts to $132.3 million as of March 31, 2024. As of March 31, 2023, total IM-1 mission estimated contract revenues were approximately $117.9 million.
Current wording
•The NASA payload contract for the IM-1 mission was awarded in June 2019 and was completed in February 2024. As a result of the successful landing on the lunar surface, previously constrained revenue of approximately $12.3 million was released bringing the total IM-1 mission contract revenue under NASA and other commercial fixed-priced contracts to $132.3 million. As of March 31 2024, the IM-1 mission and all related contracts have been closed out.
Previous wording
•The initial NASA payload contract for the IM-2 mission was awarded in October 2020 with a targeted mission launch date in December 2022. Total IM-2 mission estimated contract revenue under NASA and other commercial fixed-priced contracts increased to $122.3 million (excluding constrained revenue of $13.5 million) as of March 31, 2024 as compared to $102.2 million as of March 31, 2023. The increase in total mission estimated contract revenue is primarily due to a pending task order modification with NASA to change the mission targeted landing site within the South Pole region of the moon and extend the expected launch and post-launch services of IM-2 to late 2024 which increased estimated revenue by approximately $14.0 million.
Current wording
•The initial NASA payload contract for the IM-2 mission was awarded in October 2020 with a targeted mission launch date in December 2022. Total IM-2 mission estimated contract revenue under NASA and other commercial fixed-priced contracts increased to $122.4 million (excluding constrained revenue of $13.5 million) as of June 30, 2024 as compared to $106.0 million as of June 30, 2023. The increase in total mission estimated contract revenue is primarily due to a task order modification with NASA finalized in the second quarter of 2024 to change the mission targeted landing site within the South Pole region of the moon and extend the expected mission launch and post-launch services of IM-2 to no later than August 2025. The task order modification increased estimated contract revenue by approximately $12.5 million.
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 $87.0 million (excluding constrained revenue of $9.8 million) as of March 31, 2024 as compared to $85.4 million as of March 31, 2023. The increase in total mission estimated contract revenue is primarily due to a pending task order modification with NASA to identify its complement of payloads and extend the mission timeline into 2025 which increased estimated revenue by approximately $15.1 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 under our current contract with NASA. Total IM-3 mission estimated revenue under fixed-priced contracts is $86.9 million (excluding constrained revenue of $9.1 million) as of June 30, 2024 as compared to $80.9 million as of June 30, 2023. The increase in total mission estimated contract revenue is primarily due to a pending 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 pending task order increased estimated contract revenue by approximately $10.0 million and is expected to be finalized in the third quarter of 2024.
Previous wording
Total revenue increased by $54.8 million, or 301%, for the three months ended March 31, 2024 compared to the same period in 2023. Revenue on the IM-1 mission increased approximately $10.8 million to $12.3 million for the three months ended March 31, 2024 from $1.4 million for the same period in 2023. The increase in IM-1 revenue was due to the successful completion of the mission in February 2024 which resulted in the release of approximately$12.3 million in previously constrained revenue. Revenue on the IM-2 mission for the three months ended March 31, 2024 was $10.0 million compared to $8.6 million in the same period of 2023 and was primarily driven by a favorable change resulting from a pending task order modification to change the mission targeted landing site and extend the mission to late 2024 discussed above. As of March 31, 2024, the IM-2 mission is approximately 85% complete. Revenue from the IM-3 mission decreased to $5.5 million for the three months ended March 31, 2024 from $5.6 million for the same period in 2023. The IM-3 mission was awarded in the fourth quarter of 2021 and was approximately 59% complete as of March 31, 2024.
Current wording
Revenue on the IM-1 mission increased by approximately $6.6 million to $12.3 million for the six months ended June 30, 2024 from $5.7 million for the same period in 2023. The increase in IM-1 revenue was due to the successful completion of the mission in February 2024 which resulted in the release of approximately$12.3 million of previously constrained revenue. Revenue on the IM-2 mission decreased by $3.3 million to $9.8 million for the six months ended June 30, 2024 compared to $13.1 million for the same period of 2023 and was primarily driven by unfavorable adjustments resulting from task order modifications to change the mission targeted landing site and extension of the targeted mission launch window to early 2025 as discussed above. As of June 30, 2024, the IM-2 mission is approximately 87% complete. Revenue from the IM-3 mission decreased to $2.7 million for the six months ended June 30, 2024 from $11.1 million for the same period in 2023 and was largely attributable to unfavorable adjustments from pending task order modifications extending the targeted mission launch window to late 2025. The IM-3 mission was awarded in the fourth quarter of 2021 and was approximately 59% complete as of June 30, 2024.
Previous wording
Total cost of revenue increased by $37.8 million, or 163%, for the three months ended March 31, 2024 compared to the same period in 2023. Cost of revenue on the IM-1 mission decreased slightly by $1.7 million from $6.7 million down to $5.0 million due to winding down progress as the mission was completed in February 2024. On the IM-2 mission, cost of revenue decreased by approximately $1.6 million to $6.6 million for the three months ended March 31, 2024 from $8.2 million in the same period in 2023. IM-3 mission cost of revenue decreased by approximately $2.3 million to $4.8 million for the three months ended March 31, 2024 compared to $7.1 million in the same period in 2023.
Current wording
Total cost of revenue increased by $72.4 million, or 159%, for the six months ended June 30, 2024 compared to the same period in 2023. Cost of revenue on the IM-1 mission decreased by $5.8 million from $10.8 million down to $4.9 million due to winding down progress as the mission was completed in February 2024. On the IM-2 mission, cost of revenue decreased by approximately $0.9 million to $14.8 million for the six months ended June 30, 2024 from $15.7 million in the same period in 2023. IM-3 mission cost of revenue decreased by approximately $6.9 million to $7.6 million for the three months ended June 30, 2024 compared to $14.5 million in the same period in 2023, primarily due to lower activity on the mission.
Previous wording
As of March 31, 2024, our two lunar missions are in loss positions. On the IM-2 mission, we decreased the accrued contract loss by approximately $2.5 million during the three months ended March 31, 2024 which was primarily driven by the favorable change resulting from a pending task order modification to change the mission targeted landing site and extend the mission to late 2024 discussed above. On the IM-3 mission, the accrued contract loss increased by approximately $1.1 million during the three months ended March 31, 2024 primarily due to estimated changes resulting from the pending task order modification to extend the mission timeline into 2025 discussed above.
Current wording
As of June 30, 2024, our two lunar missions are in loss positions. On the IM-2 mission, we increased the accrued contract loss by approximately $7.1 million during the six months ended June 30, 2024 which was primarily driven by unfavorable adjustments resulting from task order modifications to change the mission targeted landing site and extension of the targeted mission launch window to early 2025. On the IM-3 mission, the accrued contract loss increased by approximately $10.9 million during the six months ended June 30, 2024 and was largely attributable to unfavorable adjustments from pending task order modifications extending the targeted mission launch window to late 2025
Previous wording
Cost of revenue from task orders under the OMES III contract were approximately $40.0 million during the three months ended March 31, 2024. The OMES III contract started in December 2023 and therefore there were no corresponding cost of revenue during the three months ended March 31, 2023. Other contract cost of revenue increased approximately $0.4 million.
Current wording
Cost of revenue from task orders under the OMES III contract were approximately $37.1 million and $77.1 million during the three and six months ended June 30, 2024. The OMES III contract started in December 2023 and therefore there were no corresponding cost of revenue during the three and six months ended June 30, 2023.
Previous wording
Revenues from task orders under the OMES III contract were approximately $41.8 million during the three months ended March 31, 2024. The OMES III contract started in December 2023 and therefore there were no corresponding revenues during the three months ended March 31, 2023. Other contract revenues increased approximately $0.8 million primarily as a result of new contracts awarded in 2023 including the Jetson Low Power and other contracts partially offset by the completion of the initial phase of the fission surface power contract in the third quarter of 2023.
Current wording
Other contract cost of revenue increased approximately $1.6 million and $2.0 million for the three and six months ended June 30, 2024 compared to the same periods in 2023 primarily as a result of new contracts awarded in late 2023 and in the first half of 2024, including the Jetson Low Power, the Lunar Terrain Vehicle Services and various other contracts partially offset by the completion of the initial phase of the fission surface power contract in the third quarter of 2023.
Previous wording
General and administrative expense (excluding depreciation) increased by $8.4 million for the three months ended March 31, 2024 compared to the same periods in 2023, driven primarily by our growth to support corporate and business operations, resulting inhigher share-based compensation expense of $3.7 million, headcount of $0.7 million, bids and proposals expense of$0.9 million. For the same comparative periods, we incurred increases in expenses related to professional services and various other administrative costs of $0.5 million primarily driven by accounting and legal fees,$0.7 million forrent expense primarily driven by the move to our new corporate headquarters in late 2023. The Company incurred bad debt expense of$1.7 million related to a payload customer on the IM-3 mission during the first quarter of 2024.
Current wording
For the three months ended June 30, 2024 compared to the same periods in 2023, the $3.7 million increase was driven by higher share-based compensation expense of$1.0 million, employee compensation and benefits expense of$1.7 million, bids and proposals expense of$0.6 million, professional services of $0.7 million primarily driven by accounting and legal fees, and rent expense of $0.7 million primarily driven by the move to our new corporate headquarters in late 2023. These increases were slightly offset byvarious other administrative costs which decreased by approximately$1.0 million.
Previous wording
Total other expense, net unfavorable change of $109.0 million for the three months ended March 31, 2024 compared to the same period in 2023 was primarily due to loss on issuance of securities of $68.7 million and unfavorable changes in fair value of the earn-out liabilities of $18.9 million and warrant liabilities of $24.0 million, slightly offset by $2.4 million related to the change in the fair value of SAFE Agreements which was eliminated in the first quarter of 2023.
Current wording
Total other income (expense), net unfavorable change of $93.3 million for the six months ended June 30, 2024 compared to the same period in 2023 was primarily due to loss on issuance of securities of $68.1 million and unfavorable changes in fair value of the earn-out liabilities of $25.5 million and warrant liabilities of $3.0 million, slightly offset by $2.4 million related to the change in the fair value of SAFE Agreements which was eliminated in the first quarter of 2023.
Previous wording
For the three months ended March 31, 2024, we recognized no income taxes for the combined U.S. federal and state expense for income taxes. For the three months ended March 31, 2023, we recognized a combined U.S. federal and state benefit for income taxes of $3.2 million. The effective combined United States federal and state income tax rates were 0.0% and (15.9%) for the three months ended March 31, 2024 and 2023, respectively. For three months ended March 31, 2024, our effective tax rate differed from the statutory rate 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 three months ended March 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 three and six months ended June 30, 2024, we recognized a combined U.S. federal and state expense for income taxes of zero, and our combined U.S. federal and state income tax rates were 0.0%. For the three and six months ended June 30, 2023, we recognized a combined U.S. federal and state expense for income taxes of $3.5 million and $0.3 million, respectively, and our effective combined U.S. federal and state income tax rates were (23.1%) and 6.3%, respectively. For three and six months ended June 30, 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 three and six months ended June 30, 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.
Previous wording
Orders comprising backlog as of a given balance sheet date are typically invoiced in subsequent periods. As of March 31, 2024, we expect to recognize approximately 55-60% of our backlog over the remainder of 2024, approximately 25-30% over the subsequent twelve months of 2025 and the remaining 10-20% 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 invoiced in subsequent periods. As of June 30, 2024, we expect to recognize approximately 45-50% of our backlog over the remainder of 2024, approximately 35-40% over the subsequent twelve months of 2025 and the remaining 10-20% 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
Backlog decreased by $46.2 million as of March 31, 2024 compared to December 31, 2023, primarily due to continued performance on existing contracts of $73.1 million and decreases related to contract value adjustments of $10.7 million primarily related to various certain fixed price contracts and task order adjustments on the OMES III contract. The decrease was slightly offset by $37.6 million in new awards primarily associated with favorable backlog adjustments to the IM-2 and IM-3 missions associated with unapproved task order modifications.
Current wording
Backlog decreased by $55.6 million as of June 30, 2024 compared to December 31, 2023, primarily due to continued performance on existing contracts of $114.5 million and decreases related to contract value adjustments of $10.7 million primarily related to various certain fixed price contracts and task order adjustments on the OMES III contract. The decrease was partially offset by $69.6 million in new awards primarily associated with the Lunar Terrain Vehicle Services design project, a new commercial payload contract on the IM-3 mission, task order modification to the IM-2 CLPS contract and an unapproved task order modification to the IM-3 CLPS contract.
Previous wording
As of March 31, 2024, our backlog of $222.4 million exceeded our remaining performance obligations of $65.8 million as reported in Note 3 - Revenue to our condensed consolidated financial statements included in this Quarterly Report. The difference of $156.6 million was primarily related to $52.6 million of variable consideration associated with constrained revenue, $104.0 million in backlog related to the funded value of OMES III and various other time and material contracts where revenue is recognized when services are performed and contractually billable and therefore not included in remaining performance obligations.
Current wording
As of June 30, 2024, our backlog of $213.0 million exceeded our remaining performance obligations of $94.6 million as reported in Note 3 - Revenue to our condensed consolidated financial statements included in this Quarterly Report. The difference of $118.4 million was primarily related to $51.9 million of variable consideration associated with constrained revenue, $66.5 million in backlog related to the funded value of OMES III and various other time and significant contracts where revenue is recognized when services are performed and contractually billable and therefore not included in remaining performance obligations.
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, and our 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, debt service requirements and other general corporate services. 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 leases.
Current 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 ATM Program with Cantor (as described below), proceeds from warrant exercises, and our 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, debt service requirements and other general corporate services. 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 leases.
Previous wording
As of March 31, 2024, we had cash and cash equivalents of $55.2 million and working capital of $10.9 million. In the first quarter of 2024, the Company received approximately $60.6 million in gross proceeds from warrant exercises and other equity transactions, as further described in Notes 7 and 8.
Current wording
As of June 30, 2024, we had cash and cash equivalents of $31.6 million and working capital deficit of $1.9 million. For the six months ended June 30, 2024, the Company received approximately $78.8 million in gross proceeds from warrant exercises, sales of stock under our ATM Program, and other equity transactions, as further described in Notes 7 and 8.
Previous wording
In connection with the Business Combination as discussed in Notes 1 and 7, the Company entered into the Cantor Purchase Agreement, pursuant to which the Company may direct CFPI, at the Company’s discretion, to purchase up to the lesser of (i) $50.0 million of newly issued shares of Class A Common Stock and (ii) the “exchange cap” specified therein, subject to certain customary conditions and limitations set forth in the agreement. Additionally, in April 2024, the Company and Cantor entered into a Controlled Equity Offering Sales Agreement with Cantor acting as the Company’s exclusive sales agent for the sale of newly issued shares of Class A Common Stock for aggregate proceeds up to $100.0 million.
Current wording
In connection with the Business Combination as discussed in Notes 1 and 7, the Company entered into the Cantor Purchase Agreement, pursuant to which the Company may direct CFPI, at the Company’s discretion, to purchase up to the lesser of (i) $50.0 million of newly issued shares of Class A Common Stock and (ii) the “exchange cap” specified therein, subject to certain customary conditions and limitations set forth in the agreement. Additionally, in April 2024, the Company and Cantor entered into a Controlled Equity Offering Sales Agreement with Cantor acting as the Company’s exclusive sales agent for the sale of newly issued shares of Class A Common Stock for aggregate proceeds up to $100.0 million, as further described in Note 7. During the second quarter of 2024, the Company raised approximately $17.0 million in net proceeds pursuant to the at-the-market financing facility, followed by an additional raise of $4.1 million in net proceeds received in early July 2024.
Previous wording
There was $8.0 million outstanding under the Credit Mobilization Facility as of March 31, 2024 and December 31, 2023. See Note 5 - Debt to our condensed consolidated financial statements for additional information related to the credit mobilization facilities.
Current wording
There was $3.0 million and $8.0 million outstanding under the Credit Mobilization Facility as of June 30, 2024 and December 31, 2023, respectively. The Company paid $5.0 million during the second quarter of 2024, and paid the remaining $3.0 million in July 2024 on the Credit Mobilization Facility. See Note 5 - Debt to our condensed consolidated financial statements for additional information related to the credit mobilization facilities.
Previous wording
In March 2024, the Company filed a shelf registration statement on Form S-3 (File No. 333-278288) with the Securities and Exchange Commission, which permits the offering, issuance, and sale of up to a maximum aggregate offering price of $300.0 million of the Company’s Class A common stock and warrants. Up to a maximum of $100.0 million of the maximum aggregate offering price of $300.0 million may be issued and sold pursuant to an at-the-market financing facility under a capital controlled equity offering sales agreement between the Company and Cantor Fitzgerald & Co. As of the date of this filing, the Company raised approximately $7.4 million in net proceeds pursuant to the at-the-market financing facility. In addition, subject to market and other conditions, we may opportunistically pursue underwritten public offerings of our Class A common stock under such shelf registration statement for our account or the account of our selling stockholders. Unless otherwise specified in the prospectus supplement relating to any such offering, we expect to use the net proceeds of any sales of Class A common stock for our account for general corporate purposes. We would not receive any proceeds from the sale of our Class A common stock by the selling stockholders. We expect to continue to evaluate opportunities for such underwritten offerings over the near and intermediate term.
Current wording
In March 2024, the Company filed a shelf registration statement on Form S-3 (File No. 333-278288) with the Securities and Exchange Commission, which permits the offering, issuance, and sale of up to a maximum aggregate offering price of $300.0 million of the Company’s Class A common stock and warrants. Up to a maximum of $100.0 million of the maximum aggregate offering price of $300.0 million may be issued and sold pursuant to an at-the-market financing facility under a capital controlled equity offering sales agreement between the Company and Cantor Fitzgerald & Co. As of the date of this filing, the Company raised approximately $21.1 million in net proceeds pursuant to the at-the-market financing facility. In addition, subject to market and other conditions, we may opportunistically pursue underwritten public offerings of our Class A common stock under such shelf registration statement for our account or the account of our selling stockholders. Unless otherwise specified in the prospectus supplement relating to any such offering, we expect to use the net proceeds of any sales of Class A common stock for our account for general corporate purposes. We would not receive any proceeds from the sale of our Class A common stock by the selling stockholders. We expect to continue to evaluate opportunities for such underwritten offerings over the near and intermediate term.
Previous wording
Cash Flows for the three months ended March 31, 2024 and 2023
Current wording
Cash Flows for the six months ended June 30, 2024 and 2023
Previous wording
During the three months ended March 31, 2024, our operating activities used $6.4 million of net cash as compared to$18.7 million of net cash used during the three months ended March 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 six months ended June 30, 2024, our operating activities used $37.7 million of net cash as compared to$15.8 million of net cash used during the six months ended June 30, 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.
Previous wording
During the three months ended March 31, 2024, investing activities used $1.6 million of net cash as compared to $8.6 million of net cash used during the three months ended March 31, 2023. The $7.0 million favorable change was primarily due to capital expenditures associated with construction in progress on equipment to be used for future missions and for our lunar operations center.
Current wording
During the six months ended June 30, 2024, investing activities used $3.8 million of net cash as compared to $20.2 million of net cash used during the six months ended June 30, 2023. The $16.4 million favorable change was primarily driven by the 2023 capital expenditures in construction in progress related to our lunar operations center which was completed during the third quarter of 2023 and subsequently reclassed to right-of-use assets on the balance sheet.
Previous wording
During the three months ended March 31, 2024, financing activities provided $60.8 million of net cash as compared to $48.3 million of net cash provided during the three months ended March 31, 2023.
Current wording
During the six months ended June 30, 2024, financing activities provided $70.6 million of net cash as compared to $49.3 million of net cash provided during the six months ended June 30, 2023.
Previous wording
During 2024, our financing activities included$50.6 million in proceeds from the exercise of warrants, $10.0 million in proceeds received in borrowings under the Bridge Loan offset by the repayment of $10.0 million, and $10.0 million in proceeds from the issuance of securities.
Current wording
During 2024, our financing activities primarily included$51.4 million in proceeds from the exercise of warrants, $27.0 million in net proceeds from the issuance of securities, $10.0 million in proceeds received in borrowings under the Bridge Loan offset by the repayment of $10.0 million, $5.0 million repayment on a loan under our Credit Mobilization Facility, and $2.1 million in payments of withholding taxes from share-based awards.
Previous wording
During 2023, our financing activities included$34.1 million in proceeds received upon consummation of the Business Combination and Series A Preferred Stock issuance slightly offset by$0.8 million in related transaction costs paid. We also received$12.7 million in cash associated with the termination of a prepaid forward purchase agreement and$2.2 million in proceeds from the exercise of warrants.
Current wording
During 2023, our financing activities primarily included$34.1 million in proceeds received upon consummation of the Business Combination and Series A Preferred Stock issuance slightly offset by$9.4 million in related transaction costs paid. We also received$12.7 million in cash associated with the termination of a prepaid forward purchase agreement and$16.1 million in proceeds from the exercise of warrants, slightly offset by member distributions of $4.3 million.
Showing the first 40 of 42 pairs. Open the source sections for the rest.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Revenues from task orders under the OMES III contract were approximately $39.1 million and $80.9 million during the three and six months ended June 30, 2024. The OMES III contract began execution in December 2023 and therefore there were no corresponding revenues during the three and six months ended June 30, 2023.
Current report — wording carried from elsewhere
General and administrative expense (excluding depreciation) increased by $3.7 million for the three months ended June 30, 2024 compared to the same periods in 2023, and increased by $12.0 million for the six months ended June 30, 2024 compared to the same periods in 2023, driven primarily by our growth to support corporate and business operations.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
In March 2024, the Company filed a shelf registration statement on Form S-3 (File No. 333-278288) with the Securities and Exchange Commission, which permits the offering, issuance, and sale of up to a maximum aggregate offering price of $300.0 million of the Company’s Class A common stock and warrants. Up to a maximum of $100.0 million of the maximum aggregate offering price of $300.0 million may be issued and sold pursuant to an at-the-market financing facility under a sales agreement between the Company and Cantor Fitzgerald & Co. As of the date of this filing, the Company raised approximately $7.4 million in net proceeds pursuant to the at-the-market financing facility. In addition, subject to market and other conditions, we may opportunistically pursue underwritten public offerings of our Class A common stock under such shelf registration statement for our account or the account of our selling stockholders. Unless otherwise specified in the prospectus supplement relating to any such offering, we expect to use the net proceeds of any sales of Class
Previous report — wording carried elsewhere
A common stock for our account for general corporate purposes. We would not receive any proceeds from the sale of our Class A common stock by the selling stockholders. We expect to continue to evaluate opportunities for such underwritten offerings over the near and intermediate term. See “Liquidity and Capital Resources—Shelf Registration and Common Stock Offerings.”