Space

U.S. government contracts lift BlackSky’s financial performance

BlackSky won a new contract award from NASA, a five-year deal to provide imagery in support of Earth observation research

WASHINGTON — U.S. government contracts are boosting the financial performance of Earth observation company BlackSky, executives said Nov. 12 during the company’s first earnings call since going public.

BlackSky released its third-quarter financial results, showing a revenue jump of $7.9 million, up 49% from a year ago. The company generated an operating loss of $48.9 million in the third quarter, up from a loss of $12.5 million in the prior year period. It ended the third quarter with $198 million of cash on its balance sheet.

The satellite imagery and geospatial data provider began trading on the NYSE in September after closing a SPAC merger with a special purpose acquisition company.

CEO Brian O’Toole said during the earnings call that BlackSky is revising its 2021 revenue forecast from $40 million to a range of $30 to $34 million. This is “primarily driven by the timing of new contract start dates and supply chain impacts due to the COVID-19 pandemic.”

O’Toole announced a new contract award from NASA, a five-year, sole source blanket purchase agreement to provide high revisit satellite imagery in support of NASA’s Earth observation research.

“This gives NASA the ability to buy imagery from us on an annual basis at the scale of multiple millions of dollars per year,” O’Toole said. “They’ve been increasing their interest in commercial imagery and analytics for climate change and other research.”

The company is pursuing new commercial business in the mining, financial and transportation sectors. But BlackSky’s main customers are U.S. government agencies, particularly defense and intelligence. “We are winning and extending multi-year contracts, which strengthens our visibility into out-year revenues,” said O’Toole.

The National Reconnaissance Office (NRO) extended an existing contract, he said. “Imagery deliveries under the contract increased 100% from the second quarter to the third quarter.”

The company also won a $30 million, five-year indefinite delivery indefinite quantity contract with the National Geospatial-Intelligence Agency (NGA) for artificial intelligence enabled economic monitoring, and signed a strategic commercial agreement with Palantir Technologies to support Palantir’s government customers. 

BlackSky is competing for an NRO contract under the Electro-Optical Commercial Layer procurement, with proposals due in early December and awards expected in spring 2022.

O’Toole said the company is looking to expand its constellation of imaging satellites from six currently to 12 by year’s end, pending the timing of planned launches from Rocket Lab’s pad in New Zealand. Two BlackSky satellites are scheduled to fly next week on Rocket Lab’s Electron vehicle. Two BlackSky satellites were lost earlier this year in a launch failure.

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