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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)the

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-39493

 

SPIRE GLOBAL, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

85-1276957

( State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

8000 Towers Crescent Drive

Suite 1100

Vienna, Virginia 22182

(Address of principal executive offices)

(202) 301-5127

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Class A common stock, par value of $0.0001 per share

 

SPIR

 

New York Stock Exchange

Warrants, each whole warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share

 

SPIR.WS

 

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

Non-accelerated filer

 

 

Smaller reporting company

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☒ No ☐

 

The registrant had outstanding 139,593,932 shares of Class A common stock, 12,058,614 shares of Class B common stock, and 18,099,982 warrants as of April 30, 2022.

 

 


 

Table of Contents

 

 

 

Page

 

 

 

PART I.

FINANCIAL INFORMATION

5

 

 

 

Item 1.

Unaudited Condensed Consolidated Financial Statements

5

 

Condensed Consolidated Balance Sheets

5

 

Condensed Consolidated Statements of Operations

6

 

Condensed Consolidated Statements of Comprehensive Loss

7

 

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

8

 

Condensed Consolidated Statements of Cash Flows

9

 

Notes to Unaudited Condensed Consolidated Financial Statements

10

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

24

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

38

Item 4.

Controls and Procedures

38

 

 

 

PART II.

OTHER INFORMATION

41

 

 

 

Item 1.

Legal Proceedings

41

Item 1A.

Risk Factors

41

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

75

Item 3.

Defaults Upon Senior Securities

75

Item 4.

Mine Safety Disclosures

75

Item 5.

Other Information

75

Item 6.

Exhibits

76

Signatures

77

 

 

2


 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “would,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

our ability to successfully identify, acquire and integrate businesses, such as our completed acquisition (the “Acquisition”) of exactEarth Ltd. (TSX: XCT) (“exactEarth”), the combined future performance of such acquisitions or our ability to pursue strategic transactions;
changes in our growth, strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, and plans;
the implementation, market acceptance, and success of our business model;
the ability to develop new offerings, services, solutions and features and bring them to market in a timely manner and make enhancements to our business;
the quality and effectiveness of and advancements in our technology and our ability to accurately and effectively use data and engage in predictive analytics;
overall level of consumer demand for our products and offerings;
expectations and timing related to product launches;
expectations of achieving and maintaining profitability;
projections of total addressable markets, market opportunity, and market share;
our ability to acquire data sets, software, equipment, satellite components, and regulatory approvals from third parties;
our expectations concerning relationships with third parties;
our ability to acquire or develop products or technologies we believe could complement or expand our platform or to expand our products and offerings internationally;
our ability to obtain and protect patents, trademarks, licenses and other intellectual property rights;
our ability to utilize potential net operating loss carryforwards;
developments and projections relating to our competitors and industries, such as the projected growth in demand for space-based data;
our ability to acquire new customers and partners or obtain renewals, upgrades, or expansions from our existing customers;
our ability to compete with existing and new competitors in existing and new markets and offerings;
our ability to retain or recruit officers, key employees or directors;
our ability to maintain effective internal control over financial reporting and to remedy identified material weaknesses;
the conversion or planned repayment of our debt obligations;
our future capital requirements and sources and uses of cash;
our ability to obtain funding for our operations;
our business, expansion plans, and opportunities;
our expectations regarding regulatory approvals and authorizations;
the increased expenses associated with being a public company;
the expectations regarding the effects of existing and developing laws and regulations, including with respect to regulations around satellites, intellectual property law, and privacy and data protection;
global and domestic economic conditions, including currency exchange rate fluctuations and geopolitical uncertainty and instability, and their impact on demand and pricing for our offerings in affected markets; and
the impact of the COVID-19 pandemic, or a similar public health threat, on global capital and financial markets, general economic conditions in the United States, and our business and operations.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

 

3


 

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors, including those described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

Neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Moreover, the forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

 

 

4


 

PART I—FINANCIAL INFORMATION

Item 1. Unaudited Condensed Consolidated Financial Statements

Spire Global, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share amounts)

(Unaudited)

 

 

 

 

March 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

91,592

 

 

$

109,256

 

Accounts receivable, net (including allowance of $301 and $339 as of March 31, 2022
    and December 31, 2021, respectively)

 

 

7,821

 

 

 

10,163

 

Contract assets

 

 

3,630

 

 

 

2,084

 

Other current assets

 

 

8,451

 

 

 

10,071

 

Total current assets

 

 

111,494

 

 

 

131,574

 

Property and equipment, net

 

 

52,071

 

 

 

48,704

 

Operating lease assets

 

 

11,003

 

 

 

 

Goodwill

 

 

54,245

 

 

 

53,627

 

Customer relationships

 

 

24,091

 

 

 

24,388

 

Other intangible assets

 

 

18,707

 

 

 

19,765

 

Other long-term assets, including restricted cash

 

 

11,767

 

 

 

12,136

 

Total assets

 

$

283,378

 

 

$

290,194

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

7,220

 

 

$

5,824

 

Accrued wages and benefits

 

 

4,597

 

 

 

5,646

 

Contract liabilities, current portion

 

 

6,483

 

 

 

8,627

 

Other accrued expenses

 

 

7,742

 

 

 

4,823

 

Total current liabilities

 

 

26,042

 

 

 

24,920

 

Long-term debt

 

 

52,682

 

 

 

51,124

 

Contingent earnout liability

 

 

10,852

 

 

 

11,369

 

Deferred income tax liabilities

 

 

813

 

 

 

835

 

Warrant liability

 

 

5,647

 

 

 

11,482

 

Operating lease liabilities, net of current portion

 

 

10,089

 

 

 

 

Other long-term liabilities

 

 

1,761

 

 

 

1,600

 

Total liabilities

 

 

107,886

 

 

 

101,330

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

Common stock, $0.0001 par value, 1,000,000,000 Class A and 15,000,000 Class B shares
    authorized,
139,592,078 Class A and 12,058,614 Class B shares issued and outstanding at
    March 31, 2022;
139,096,000 Class A and 12,058,614 Class B shares issued and
    outstanding at December 31, 2021

 

 

15

 

 

 

15

 

Additional paid-in capital

 

 

421,502

 

 

 

418,575

 

Accumulated other comprehensive income

 

 

2,591

 

 

 

732

 

Accumulated deficit

 

 

(248,616

)

 

 

(230,458

)

Total stockholders’ equity

 

 

175,492

 

 

 

188,864

 

Total liabilities and stockholders’ equity

 

$

283,378

 

 

$

290,194

 

 

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

 

5


 

Spire Global, Inc.

Condensed Consolidated Statements of Operations

(In thousands, except share and per share amounts)

(Unaudited)

 

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Revenue

 

$

18,070

 

 

$

9,716

 

Cost of revenue

 

 

9,846

 

 

 

3,328

 

Gross profit

 

 

8,224

 

 

 

6,388

 

Operating expenses

 

 

 

 

 

 

Research and development

 

 

8,657

 

 

 

6,900

 

Sales and marketing

 

 

6,905

 

 

 

3,941

 

General and administrative

 

 

12,684

 

 

 

8,394

 

Total operating expenses

 

 

28,246

 

 

 

19,235

 

Loss from operations

 

 

(20,022

)

 

 

(12,847

)

Other income (expense)

 

 

 

 

 

 

Interest income

 

 

14

 

 

 

1

 

Interest expense

 

 

(3,043

)

 

 

(2,550

)

Change in fair value of contingent earnout liability

 

 

517

 

 

 

 

Change in fair value of warrant liabilities

 

 

5,835

 

 

 

(5,991

)

Other (expense) income, net

 

 

(1,169

)

 

 

2,076

 

Total other income (expense), net

 

 

2,154

 

 

 

(6,464

)

Loss before income taxes

 

 

(17,868

)

 

 

(19,311

)

Income tax provision

 

 

290

 

 

 

387

 

Net loss

 

$

(18,158

)

 

$

(19,698

)

Basic and diluted net loss per share

 

$

(0.13

)

 

$

(1.11

)

Weighted-average shares used in computing basic and diluted net loss per share

 

 

139,274,538

 

 

 

17,750,210

 

 

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

 

6


 

Spire Global, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(In thousands)

(Unaudited)

 

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Net loss

 

$

(18,158

)

 

$

(19,698

)

Other comprehensive loss:

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

1,859

 

 

 

32

 

Comprehensive loss

 

$

(16,299

)

 

$

(19,666

)

 

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

 

7


 

 

Spire Global, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

(In thousands, except share amounts)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Additional
Paid

 

 

Accumulated
Other
Comprehensive

 

 

Accumulated

 

 

Total
Stockholders'

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income

 

 

Deficit

 

 

Equity

 

Balance, December 31, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

151,154,614

 

 

$

15

 

 

$

418,575

 

 

$

732

 

 

$

(230,458

)

 

$

188,864

 

Exercise of stock options

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

492,064

 

 

 

 

 

 

638

 

 

 

 

 

 

 

 

 

638

 

Vesting of restricted stock units

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock compensation
   expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,289

 

 

 

 

 

 

 

 

 

2,289

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18,158

)

 

 

(18,158

)

Foreign currency
   translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,859

 

 

 

 

 

 

1,859

 

Balance, March 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

151,650,692

 

 

$

15

 

 

$

421,502

 

 

$

2,591

 

 

$

(248,616

)

 

$

175,492

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Series A
Preferred Stock

 

 

Series B
Preferred Stock

 

 

Series C
Preferred Stock

 

 

Common Stock

 

 

Additional
Paid

 

 

Accumulated
Other
Comprehensive
Income

 

 

Accumulated

 

 

Total
Stockholders'

 

 

 

Shares(1)

 

 

Amount

 

 

Shares(1)

 

 

Amount

 

 

Shares(1)

 

 

Amount

 

 

Shares(1)

 

 

Amount

 

 

Capital

 

 

(Loss)

 

 

Deficit

 

 

(Deficit)

 

Balance, December 31, 2020

 

 

21,615,723

 

 

$

52,809

 

 

 

8,306,818

 

 

$

35,228

 

 

 

12,804,176

 

 

$

65,222

 

 

 

17,664,015

 

 

$

2

 

 

$

10,131

 

 

$

(982

)

 

$

(211,146

)

 

$

(48,736

)

Exercise of stock options

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

251,500

 

 

 

 

 

 

295

 

 

 

 

 

 

 

 

 

295

 

Stock compensation
   expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,507

 

 

 

 

 

 

 

 

 

2,507

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(19,698

)

 

 

(19,698

)

Foreign currency
   translation adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

32

 

 

 

 

 

 

32

 

Balance, March 31, 2021

 

 

21,615,723

 

 

$

52,809

 

 

 

8,306,818

 

 

$

35,228

 

 

 

12,804,176

 

 

$

65,222

 

 

 

17,915,515

 

 

$

2

 

 

$

12,933

 

 

$

(950

)

 

$

(230,844

)

 

$

(65,600

)

 

(1)
The shares of the Company’s common and convertible preferred stock, prior to the Merger (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 1.7058 established in the Merger.

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

 

8


 

 

Spire Global, Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(18,158

)

 

$

(19,698

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

4,834

 

 

 

1,711

 

Stock-based compensation

 

 

2,289

 

 

 

2,507

 

Amortization of operating lease assets

 

 

573

 

 

 

 

Accretion on carrying value of convertible notes

 

 

 

 

 

1,407

 

Amortization of debt issuance costs

 

 

1,413

 

 

 

616

 

Change in fair value of warrant liability

 

 

(5,835

)

 

 

5,991

 

Change in fair value of contingent earnout liability

 

 

(517

)

 

 

 

Loss on extinguishment of debt

 

 

 

 

 

(1,699

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable, net

 

 

2,215

 

 

 

(3,799

)

Contract assets

 

 

(1,531

)

 

 

38

 

Other current assets

 

 

1,409

 

 

 

40

 

Other long-term assets

 

 

469

 

 

 

 

Accounts payable

 

 

(828

)

 

 

1,080

 

Accrued wages and benefits

 

 

(1,051

)

 

 

(420

)

Contract liabilities

 

 

(962

)

 

 

(244

)

Other accrued expenses

 

 

1,077

 

 

 

1,655

 

Operating lease liabilities

 

 

(342

)

 

 

 

Other long-term liabilities

 

 

(46

)

 

 

(6

)

Net cash used in operating activities

 

 

(14,991

)

 

 

(10,821

)

Cash flows from investing activities

 

 

 

 

 

 

Purchase of property and equipment

 

 

(4,243

)

 

 

(1,378

)

Investment in intangible assets

 

 

(19

)

 

 

 

Net cash used in investing activities

 

 

(4,262

)

 

 

(1,378

)

Cash flows from financing activities

 

 

 

 

 

 

Proceeds from long-term debt

 

 

95

 

 

 

 

Proceeds from issuance of convertible notes payable

 

 

 

 

 

20,000

 

Payments of debt issuance costs

 

 

 

 

 

(62

)

Proceeds from exercise of stock options

 

 

638

 

 

 

295

 

Net cash provided by financing activities

 

 

733

 

 

 

20,233

 

Effect of foreign currency translation on cash, cash equivalent and restricted cash

 

 

850

 

 

 

(590

)

Net (decrease) increase in cash, cash equivalents and restricted cash

 

 

(17,670

)

 

 

7,444

 

Cash, cash equivalents and restricted cash

 

 

 

 

 

 

Beginning of year

 

 

109,645

 

 

 

15,986

 

End of year

 

$

91,975

 

 

$

23,430

 

Supplemental disclosure of cash flow information

 

 

 

 

 

 

Cash paid for interest

 

$

1,627

 

 

$

383

 

Noncash Investing and financing activities