SIDU 10-K & 10-Q changes, risk factors and insider trading
Sidus Space Inc. · Nasdaq · Radiotelephone Communications · CIK 1879726 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Our satellites and platform could fail to perform or perform at reduced levels of service because of technological malfunctions, satellite failures, or loss of connectivity, which could materially and adversely affect our business, financial condition and results of operations.”
Removed heading “The COVID-19 pandemic has and could continue to negatively affect various aspects of our business, make it more difficult for us to meet our obligations to our customers, and result in reduced demand for our products and services, which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.”
Largest changes
“The COVID-19 pandemic has and could continue to negatively affect various aspects of our business, make it more difficult for us to meet our obligations to our customers, and result in reduced demand for our products and services, which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.”see in full comparison
“Our satellites and platform could fail to perform or perform at reduced levels of service because of technological malfunctions, satellite failures, or loss of connectivity, which could materially and adversely affect our business, financial condition and results of operations.”see in full comparison
“In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, and it has since spread throughout other parts of the world, including the United States. Any outbreak of contagious diseases or other adverse public health developments could have a material adverse effect on our business operations. …”see in full comparison
“The success of our business depends on the successful launch, deployment, and sustained operation of our satellites. Satellites are subject to significant operational risks while in orbit, including technical failures, component malfunctions, loss of connectivity, and damage from space debris or solar activity. We may experience a total loss of a satellite during launch or fail to maintain communication once in orbit. …”see in full comparison
The success of our business will be highly dependent on our ability to effectively market and sell our commercial satellite manufacturing, launch, and data services for LEO, GEO,see in full comparisonCislunarcislunar, andLunarlunarsatellites.missions along with our proprietary hardware offerings, including edge computing systems, VPX computing platforms, and broader space and defense manufacturing services.
We have not historically obtained and may not maintain launch or in-orbit insurance coverage for our satellites to address the risk of potential systemic anomalies, failures, collisions with our satellites or other satellites or debris, or catastrophic events affecting the existing satellite system. If one or more of our launches result in catastrophic failure or one or more of our in-orbit satellites orsee in full comparisontechnologiespayloads fail, and we have not obtained insurance coverage, we could be required to record significant impairment charges for the satellite ortechnology.payload.
Full comparison: every changed paragraph (24)
Our
limited operating history makes it difficult to evaluate our future prospectsRisks and the risks and challenges it may encounter. Risks and
challenges we have faced or expects expect
to face include our ability to:
If
we fail to address the risks and difficulties that we face, including those associated with the challenges listed above as well as those
described elsewhere in this “Risk Factors” section, our business, financial condition and results of operations could
be adversely affected. Further, because we have limited historical financial data and operate in a rapidly evolving market, any predictions
about its future revenue and expenses may not be as accurate as they would be if itwe had a longer operating history or operated in a more
developed market. We have encountered in the past, and will encounter in the future, risks and uncertainties frequently experienced by
growing companies with limited operating histories in rapidly changing industries. If our assumptions regarding these risks and uncertainties,
which we use to plan and operate our business, are incorrect or change, or if we do not address these risks successfully, our results
of operations could differ materially from its expectations and itsour business, financial condition and results of operations could be
adversely affected.
In
the future, we could be required to raise capital through public or
private financing or other arrangements. Such financing may not be
available on acceptable terms, or at all, and our failure to raise
capital when needed could harm our business. For example, the global
COVID-19 health crisis and related financial impact has resulted in, and may continue to result in, significant disruption and volatility
of global financial markets that could adversely impact our ability to access capital. We may sell equity securities or debt securities
in one or more transactions at prices and
in a manner as we may determine from time to time. If we sell any such securities in subsequent
transactions, our current investors may
be materially diluted. Any debt financing, if available, may involve restrictive covenants and
could reduce our operational flexibility
or profitability. If we cannot raise funds on acceptable terms, we may not be able to grow our
business or respond to competitive pressures.
The
success of our business will be highly dependent on our ability to effectively market and sell our commercial satellite manufacturing,
launch, and data services for LEO, GEO, Cislunarcislunar, and Lunarlunar satellites.missions along with our proprietary hardware offerings, including edge computing systems, VPX computing platforms, and broader
space and defense manufacturing services.
We
expect that our success will be highly dependent, especially in the foreseeable future, on our ability to effectively forecast,
market market
and sell our manufacturing, launch and data services for LEO,satellites, GEO,proprietary Cislunarhardware offerings, and Lunarbroader satellites.space and defense manufacturing
services. We have limited experience in forecasting,
marketing and selling such services, and if we are unable to utilize our current or future sales organization effectively in order
to to
adequately target and engage our potential customers, our business may be adversely affected.
The
success of our launch and satellite services business will depend on our ability to successfully and regularly deliver customer satellites
into orbit. In November 2019, we successfully launched EFTP, our on-orbit external experimental facility hosted on the NanoRacks International
Space Station External Platform (NREP). Additionally, in January of 2020, a microsatellite was successfully launched from the ISS using
our SSIKLOPS platform for the STP program office. In March 2024, we launched our first LizzieSat® satellite, in December 2024 we launched
launched our second LizzieSat® and in March 2025, we launched our third LizzieSat® satellite There
is no guarantee that our planned commercial launches or subsequent commercial launches thereafter will be successful. While we believe
that our launch partners have built operational processes to ensure that the design, manufacture, performance and servicing of their
launch vehicles and rockets meet rigorous performance goals, there can be no assurance that our launch partners will not experience operational
or process failures and other problems during any of our planned launches. Any failures or setbacks could harm our reputation and have
a material adverse effect on our business, financial condition and results of operation.
The
market for commercial satellite manufacturing, launch and data services for LEO,small GEO, Cislunar and LunarLEO satellites is not well established,
is still emerging
and may not achieve the growth potential we expect or may grow more slowly than expected.
The
market for in-space infrastructure services, in particular commercial satellite manufacturing, launch and data services for LEO,small LEO
GEO, Cislunar and Lunar satellites, has not been well established and is still emerging. Our estimates for the total addressable
launch market and satellite
market are based on several internal and third-party estimates, including our contracted revenue, the number
of potential customers who
have expressed interest in our satellite launch and data services, assumed prices and production costs for
our services, assumed flight
cadence, our ability to leverage our current manufacturing and operational processes and general market
conditions. While we believe
our assumptions and the data underlying our estimates are reasonable, these assumptions and estimates may
not be correct and the conditions
supporting our assumptions or estimates may change at any time, thereby reducing the predictive accuracy
of these underlying factors.
As a result, our estimates of the annual total addressable market for our services, as well as the expected
growth rate for the total
addressable market for our services, may prove to be incorrect.
Our satellites and platform could fail to perform or perform at reduced levels of service because of technological malfunctions, satellite failures, or loss of connectivity, which could materially and adversely affect our business, financial condition and results of operations.
The success of our business depends on the successful launch, deployment, and sustained operation of our satellites. Satellites are subject to significant operational risks while in orbit, including technical failures, component malfunctions, loss of connectivity, and damage from space debris or solar activity. We may experience a total loss of a satellite during launch or fail to maintain communication once in orbit. Additionally, even if successfully deployed, a satellite may suffer a premature “end-of-life” event or a degradation in performance that results in a permanent loss of connectivity and subsequent impairment.
We are at risk of adverse publicity stemming from any public incident involving our company, our people or our brand. If any of our launch partners’ vehicles or our satellites or those of one of our competitors were to be involved in a public incident, accident or catastrophe, this could create an adverse public perception of satellite launch or manufacturing activities and result in decreased customer demand for launch and satellite services, which could cause a material adverse effect on our business, financial conditions and results of operations. Further, if our launch partners’ vehicles or rockets were to be involved in a public incident, accident or catastrophe, we could be exposed to significant reputational harm or potential legal liability. Any reputational harm to our business could cause customers with existing contracts with us to cancel their contracts and could significantly impact our ability to make future sales. The insurance we carry may be inapplicable or inadequate to cover any such incident, accident or catastrophe. In the event that our insurance is inapplicable or not adequate, we may be forced to bear substantial losses from an incident or accident.
Further,
if a launch is delayed, our timing for recognition of revenue may be impacted depending on the length of the delay and the nature of
the contract with the customers with technologiespayloads on such delayed flight. Such a delay in recognizing revenue could materially impact our
our financial statements or result in negative impacts to our earnings during a specified time period, which could have a material effect
on our results of operations and financial condition.
In
addition, we have in the past and may in the future experience delays in manufacture or operation as we go through the requalification
process with any replacement third-party supplier, as well as the limitations imposed by International Traffic in Arms Regulations and
other restrictions on transfer of sensitive technologies. Additionally, the imposition of tariffs on such raw materials or supplied components
could have a material adverse effect on our operations. Prolonged disruptions in the supply of any of our key raw materials or components,
difficulty qualifying new sources of supply, implementing use of replacement materials or new sources of supply or any volatility in
prices could have a material adverse effect on our ability to operate in a cost-effective,cost-efficient, timely manner and could cause us to experience
cancellations or delays of scheduled launches, customer cancellations or reductions in our prices and margins, any of which could harm
our business, financial condition and results of operations.
We
face intense competition in the commercial space market and amongst our competitors. Currently, our primary competitors in the commercial
satellite market are Blacksky, Spire, Hawkeye 360, LoftOrbital, IceEye,York MuonAerospace Space, Redwire, True Anomoly,Systems and Satellogic.IceEye. In addition,
we are aware of a significant
number of entities actively engaged in developing commercial launch capabilities for small and medium sized
satellite payloads, including
ABL, Rocketlab, Blue Origin, United Launch Alliance and Firefly, among others. Many of our current and
potential competitors are larger
and have substantially greater financial or other resources than we currently have or expect to have
in the future and thus may be better
positioned to exploit the market need for small payloads and targeted orbital delivery, which is
the focus of our business. They may
also be able to devote greater resources to the development of their current and future technologies,
which could overlap with our technologies,
or the promotion and sale of their products and services. Our competitors could offer small
launch vehicles at lower prices, which could
undercut our business strategy and potential competitive edge. Our current and potential
competitors may also establish cooperative or
strategic relationships amongst themselves or with third parties that may further enhance
their resources and offerings relative to ours.
Further, it is possible that domestic or foreign companies or governments, some with
greater experience in the aerospace industry or
greater financial resources than we possess, will seek to provide products or services
that compete directly or indirectly with ours
in the future. Any such foreign competitor, for example, could benefit from subsidies from,
or other protective measures by, its home
country.
We
have not historically obtained and may not maintain launch or in-orbit insurance coverage for our satellites to address the risk of potential
systemic anomalies, failures,
collisions with our satellites or other satellites or debris, or catastrophic events affecting the existing
satellite system. If one
or more of our launches result in catastrophic failure or one or more of our in-orbit satellites or technologies payloads
fail, and we have not obtained insurance coverage, we could be required to record
significant impairment charges for the satellite or technology.
payload.
We
have not historically obtained and may not maintain launch or in-orbit insurance coverage for our satellites to address the risk of potential
systemic anomalies, failures, collisions with our satellites or other satellites or debris, or catastrophic events affecting the existing
satellite system. If one or more of our in-orbit uninsured satellites or technologiespayloads fail, or one or more of our uninsured satellites is
is destroyed during failed launch, we could be required to record significant impairment charges for the satellite or technology.payload. We
may review
the purchase of launch insurance on a case-by-case basis evaluating the launch history of our launch provider, number of satellites to
to be deployed on the launch vehicle, the status of our constellation,on-orbit satellite fleet, our ability to launch additional satellites in the near
term, term,
and the cost of insurance, among other factors. As a result of our case-by-case evaluation process, we have procured launch insurance
for our next four upcoming launches, which policies are subject to the typical terms and conditions regarding, among other things, cancellation
and scope of coverage. We do not maintain third-party liability insurance with respect to our satellites. Accordingly, we currently have
no insurance to cover any third-party damages that may be caused by any of our satellites, including personal and property insurance.
If we experience significant uninsured losses, such events could have a material adverse impact on our business, financial condition
and results of operations.
The
COVID-19 pandemic has and could continue to negatively affect various aspects of our business, make it more difficult for us to meet
our obligations to our customers, and result in reduced demand for our products and services, which could have a material adverse effect
on our business, financial condition, results of operations, or cash flows.
In
December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, and it has since spread throughout other
parts of the world, including the United States. Any outbreak of contagious diseases or other adverse public health developments could
have a material adverse effect on our business operations. These impacts to our operations have included and could again in the future
include disruptions or restrictions on the ability of our employees and customers to travel or our ability to pursue collaborations and
other business transactions, travel to customers and/or conduct live demonstrations of our products, oversee the activities of our third-party
manufacturers and suppliers. We may also be impacted by the temporary closure of the facilities of suppliers, manufacturers, or customers.
Our Chief Executive Officer, Carol Craig, is also the Chief Executive Officer of Craig Technical Consulting, Inc., d/b/a/ Craig Technologies (“CTC”) and may allocate her time to such other business thereby causing conflicts of interest in her determination as to how much time to devote to our affairs. This could have a negative impact on our ability to implement our plan of operation.
Risks
Related to our Relationship with Craig Technical Consulting, Inc.CTC
The
ownership by our Chief Executive Officer of shares of CTC common stock may create, or may create the appearance of,of conflicts of interest.
Ownership by our Chief Executive Officer of common stock of CTC, creates, or,or may create the appearance of,of conflicts of interest when
she is faced with decisions that could have different implications for CTC than the decisions have for us. Our Chief Executive Officer
has agreed to recuse herself with respect to voting on any matter coming before either CTC’s or our board of directors related
to our relationship with CTC, although she will still be permitted to participate in discussions and negotiations. Any perceived conflicts
of interest resulting from investors questioning the independence of our management or the integrity of corporate governance procedures
may materially affect our stock price.
Our
Class B common stock has ten votes per share, and our Class A common stock, which is the stock that we sold in our initial public offering,
has one vote per share. CTC holds all of the issued and outstanding shares of our Class B common stock, representing approximately 5.2%1.5%
of the voting power of our outstanding capital stock. In addition, because of the ten-to-one voting ratio between our Class B and Class
A common stock, the holder of our Class B common stock could continue to have significant influence in the voting power of our common
stock and therefore
significantly influence all matters submitted to our stockholders for approval until converted by our Class B common
stockholder. This
significant influence may limit or preclude your ability to influence corporate matters for the foreseeable future,
including the election
of directors, amendments of our organizational documents and any merger, consolidation, sale of all or substantially
all of our assets
or other major corporate transactions requiring stockholder approval. In addition, this concentrated control may prevent
or discourage
unsolicited acquisition proposals or offers for our capital stock that you may feel are in your best interest as one of
our stockholders.
As a result, such influence may adversely affect the market price of our Class A common stock.
In the past, securities class action litigation has often been brought against companies following a decline in the market price of their securities. This risk is especially relevant for us because space technology and defense companies have experienced significant share price volatility in recent years. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and resources, which could harm our business.
provided provided,
that, if and only if the Court of Chancery
of the State of Delaware dismisses any of the foregoing actions for lack of subject matter
jurisdiction, any such action or actions may
be brought in another state court sitting in the State of Delaware.
Management's Discussion & Analysis (MD&A)
New heading “Recent Developments:”
New heading “Results of Operations:”
New heading “Cost of Revenue:”
New heading “Operating Expenses:”
New heading “Liquidity and Capital Resources:”
New heading “Capital Expenditures:”
New heading “Financing Activities:”
New heading “Going Concern Considerations:”
New heading “Known Trends, Events, and Uncertainties:”
New heading “Critical Accounting Policies and Estimates:”
New heading “Comparison of year ended December 31, 2025 to year ended December 31, 2024”
New heading “Satellite Impairment”
Removed heading “Products and Services”
Removed heading “Precision Machining and Assembly”
Removed heading “Mechanical/Electrical Assembly and Test”
Removed heading “Design Engineering”
Removed heading “Key Achievements”
Removed heading “Differentiation:”
Removed heading “Key Factors Affecting Our Results and Prospects”
Removed heading “Expanding Commercial Satellite Operations”
Removed heading “Growing and expanding our experienced space hardware operations”
Removed heading “Vertically Integrated Space Infrastructure Manufacturing”
Removed heading “Revenue Generation”
Removed heading “Lowering Manufacturing Cost and Schedule”
Removed heading “Environmental, social, and corporate governance”
Removed heading “Our Growth Strategies”
Removed heading “Global Space Industry Overview”
Removed heading “Small Satellite Market”
Largest changes
“During the fiscal year, our operating activities were focused on advancing satellite programs, supporting customer manufacturing and engineering contracts, expanding mission operations capabilities, and continuing to invest in artificial intelligence-enabled computing and data processing technologies. These initiatives required significant upfront investment in personnel, infrastructure, product development, and regulatory compliance, which impacted operating results and liquidity during the period.”see in full comparison
“Our business and operating results are subject to a number of trends and uncertainties, including the timing of satellite launches, customer adoption of space-based capabilities, regulatory approvals, supply chain availability, macroeconomic conditions, and geopolitical developments. These factors may materially impact future revenue, operating results, liquidity, and capital requirements.”see in full comparison
“Sidus has demonstrated proven space heritage, successfully launching three hybrid, additively manufactured LizzieSat® satellites equipped with advanced AI edge-computing capabilities in just over 12 months. This achievement underscores our position as a leader in space technology, artificial intelligence, and innovation. This success is built on more than a decade of experience delivering flight-proven systems, platforms, devices, and hardware for customers such as NASA, the Department of Defense (DoD), SpaceX, and Blue Origin. …”see in full comparison
“By processing onboard sensor data directly and transmitting only crucial information, the Orlaithtm AI ecosystem reduces downlink costs and significantly bolsters response times for critical events. Additionally, Cielo™ AI algorithms can be upgraded while in orbit, providing adaptability for evolving mission needs. The data-as-a-service approach is designed to support applications in environmental monitoring, disaster response, security, and more, offering customers access to near real-time data that can aid in informed decision-making. …”see in full comparison
Full comparison: every changed paragraph (152)
You
should read the following discussion and analysis
of our financial condition and plan of operations together with and our accompanying
consolidated financial statements and the related
notes appearing elsewhere in this Annual Report on Form 10-K. In addition to historical
information, this discussion and analysis contains
contain forward-looking statements that involve risks, uncertaintiesuncertainties, and assumptions. Our
actual results may differ materially from those discussed
below. Factors that could cause or contribute to such differences include,
but are not limited to, those identified below, and those
discussed in the section titled “Risk Factors” included elsewhere
in this Annual Report on Form 10-K. All amounts in this
report are in U.S. dollars, unless otherwise noted.noted
Sidus Space operates as a vertically integrated space and defense technology company providing satellite design and manufacturing, technology integration, mission operations, artificial intelligence-enabled products and services, and space-based data solutions to government, defense, intelligence, and commercial customers. Our operations are supported by in-house engineering, manufacturing, assembly, integration, testing, and mission control capabilities.
During the fiscal year, our operating activities were focused on advancing satellite programs, supporting customer manufacturing and engineering contracts, expanding mission operations capabilities, and continuing to invest in artificial intelligence-enabled computing and data processing technologies. These initiatives required significant upfront investment in personnel, infrastructure, product development, and regulatory compliance, which impacted operating results and liquidity during the period.
Our results of operations are influenced by the timing and structure of customer contracts, milestone achievement, regulatory approvals, satellite launch schedules, and the level of investment required to support both current programs and anticipated future growth. As a result, revenue, expenses, and cash flows may fluctuate from period to period.
This overview should be read in conjunction with the more detailed discussion of our results of operations, liquidity and capital resources, and known trends and uncertainties set forth below.
Founded in 2012, Sidus Space is an innovative, agile space mission enabler
providing flexible, cost-effective solutions to government, defense, intelligence, and commercial companies
around the globe. Our products and services include satellite manufacturing and technology integration, AI-driven space-based data solutions,
mission planning and management operations, AI/ML products and services and space and defense manufacturing. With our mission of Space Access Reimagined®, Sidus is committed to rapid innovation, adaptable and cost-effective solutions, and the optimization of space
system and data collection performance.
We offer customers a variety
of mission options whether the ability to host a technology, procure a satellite bus, or simply purchase data as a service. Our flight proven modular satellite, LizzieSat® is a 3D printed, multi-sensor,
multi-mission satellite, which is the first of its kind, offering a flexible, cost-effective platform
that can be easily adapted to integrate new technologies or customized and scaled to create a new satellite design to meet mission requirements.
Through our Sidus
Orlaith™ AI ecosystem, we enable near real-time on-orbit data processing, enhancing the speed and efficiency of data delivery
from LizzieSat® sensors. Orlaith™ offers high-performance on-orbit edge computing and data processing from diverse sensor
sets leveraging Sidus’ proprietary FeatherEdge™ hardware and Cielo™ software. Orlaith’s systemic
capabilities provide industry-leading and differentiated data delivery for a wide range of end uses including methane detection, AIS
tracking, border security, and technology characterization. Orlaith’s data processing can also be seamlessly customized for new
and/or esoteric missions.
As a forward-thinking mission
partner, Sidus excels at responding swiftly to change. We work closely with global clients to co-develop mission solutions tailored to
both technical requirements and budget constraints. Our Cielo™ AI data processing algorithms can be updated while in orbit, which
provides additional mission flexibility. By leveraging our vertically integrated in-house capabilities, engineering, manufacturing, and
mission management, we are able to rapidly pivot and deliver at the pace of innovation.
Sidus has demonstrated proven
space heritage, successfully launching three hybrid, additively manufactured LizzieSat® satellites equipped with advanced AI edge-computing
capabilities in just over 12 months. This achievement underscores our position as a leader in space technology, artificial intelligence,
and innovation. This success is built on more than a decade of experience delivering flight-proven systems, platforms, devices, and hardware
for customers such as NASA, the Department of Defense (DoD), SpaceX, and Blue Origin. We are strategically headquartered on Florida’s
Space Coast, which provides easy access to nearby launch facilities, and we operate a 35,000-square-foot manufacturing, assembly, integration,
and testing facility which reduces production time. We have an experienced team with expertise in multi-disciplinary engineering, mission-critical
hardware manufacturing, satellite design, production, launch planning, mission operations, and in-orbit support.
We continue to focus on
innovation and agility. In October of 2024, we received approval from the U.S. Federal Communications Commission (FCC) to operate a micro
constellation of remote sensing, multi-mission satellites in Low Earth Orbit (LEO), and we continue to enhance the capabilities of our
LizzieSat® platform. Planned enhancements include:
Our products and services
are offered through several verticals: Satellite Design and Manufacturing; Technology Design and Integration; AI-driven Space-based Data
Solutions; Mission Planning Operations; AI/ML Products and Services; and Space and Defense Manufacturing.
Our vertically integrated
model with complementary lines of business enables us to unlock new potential revenue generating opportunities while maintaining diversity
of revenue. We are not dependent on a single line of business or customer, which provides us the “optionality” to scale where
market needs demand. This diversity mitigates risks associated with external factors like macroeconomic shifts or technological disruptions.
Our flexibility allows us to adapt swiftly to market changes, supporting growth across all our business lines.
Products and Services
We provide adaptable yet
cost efficient solutions with the full understanding and experience of the entire space life cycle from hardware manufacturing to mission
planning and operations to space-based data delivery.
Custom
satellite design and manufacturing: Sidus provides custom satellite design services, working closely with clients to develop
satellite solutions aligned with specific mission objectives. Using the modular LizzieSat® platform, which can be adapted
for various technologies and mission requirements, Sidus supports the design and integration process from concept to completion. This
flexible approach is intended to deliver tailored satellite designs that can meet a broad range of operational and data collection needs.
We currently have three variations of our LizzieSat® platform:
Sidus also offers
fully customized satellite design services for any mission in Leo, Geo, Cislunar or Lunar.
Technology
hosting and mission management: Sidus offers technology hosting and mission management services designed to simplify clients’
path to space and enable clients to focus on their mission goals without the complexities of satellite operation. Sidus provides integration
for a variety of payloads using our LizzieSat® platform. While on-orbit, we provide 24/7/365 real-time routine and non-real-time
mission operations, including satellite monitoring, control, and data management. Our support includes:
AI enhanced
space-based sensor Data-as-a-Service: Sidus offers AI-enhanced Data-as-a-Service, utilizing the Orlaithtm AI ecosystem,
which includes our FeatherEdge™ AI processor and Cielo™ AI solutions from space, on the LizzieSat® platform to deliver
timely data insights from space. The LizzieSat® design enables simultaneous on-orbit data collection from multiple sensors, with
the flexibility to combine data streams in unique ways to support diverse applications and missions from the same platform.
By processing
onboard sensor data directly and transmitting only crucial information, the Orlaithtm AI ecosystem reduces downlink costs
and significantly bolsters response times for critical events. Additionally, Cielo™ AI algorithms can be upgraded while in orbit,
providing adaptability for evolving mission needs. The data-as-a-service approach is designed to support applications in environmental
monitoring, disaster response, security, and more, offering customers access to near real-time data that can aid in informed decision-making. The
data-as-a-service is a subscription-based model with multiple price tiers based on span of data accessed and is applicable to multiple
customers including government (e.g., climate change, environmental disasters), defense (e.g., border security), and commercial (e.g.,
insurance).
Space
and Defense Manufacturing:
Sidus provides a range of space products and manufacturing
services, including mission-critical components and systems engineered for space environments. Our 35,000-square-foot ISO 9001:2015,
AS9100 Rev. D certified facility supports the manufacturing, testing, and assembly of space-grade hardware. Sidus works to deliver high-quality,
reliable space products for government, defense, and commercial clients by leveraging its expertise in engineering and mission-critical
manufacturing. Our space offerings include:
We
have an approximately 10,000 square-foot reconfigurable avionics lab that produces a wide range of space system flight and ground
cables, medical and mission critical wire harnesses, military harness assemblies, electronic chassis, and electro-mechanical
assemblies. Additionally, our 864 square foot, ISO-8 clean room allows us to offer
highly differentiated manufacturing and assembly.
Our
manufacturing capabilities combine our design engineering, precision machining, waterjet cutting, and wire harness fabrication experience
to provide the highest quality and performance for mission critical systems.
Precision
Machining and Assembly
Our
growing team of engineers and technicians, combined with state-of-the-art equipment support precision machining, fabrication, and assembly
for prototypes, test articles, one-offs, low-rate initial production up through high volume Swiss screw machining production. We utilize
the latest CNC machining and turning processes to deliver high-quality, complex and on-demand parts for specialized industries including
the space sector.
3D
Printing
From
early-stage product development to functional finished parts, Sidus offers commercial and industrial-grade additive manufacturing solutions.
Our 3D printers enable us to provide rapid manufacturing with industrial micron-level laser scanning accuracy and 50 µm repeatability.
Using Continuous Fiber Fabrication technology, we can produce parts at an enhanced schedule that are stronger than 6061 Aluminum and
40% lighter. Sidus provides internal engineering support to optimize the functional performance, product life cycle, and accuracy of
its customers’ specific 3D printed technology to ensure repeatability and consistency across prints. Our 3D printing capabilities
include:
Mechanical/Electrical
Assembly and Test
As
part of our 35,000 square foot manufacturing facility, we have a reconfigurable electronics and cable harness fabrication lab with the
necessary equipment, staff and square footage to produce space flight and ground cables and electronic chassis. Our experience and capabilities
include manufacturing, assembly and testing of a wide selection of electrical control cabinet and electronic cabinet modification and
fabrication processes. We have extensive experience assembling electronics, including soldering, crimping, multi-pinned connector terminations,
fusion splicing, molding, potting, and testing.
Certifications
include NASA 8739.4, NASA 8739.5, J STD 001 and IPC A 610. Our IPC-J-STD-001 accredited technicians adhere to NASA work standards KSC-E-165,
KSC-GP-864, KSC-STD-132, all required for NASA 8739.4 credentials with other industry-standard certifications.
Design Engineering
We provide quality
in-house design engineering services from up-front analysis to integration, assembly, and test. Our ISO 9001:2015 / AS9100D certified
engineering capabilities include the ability to perform initial design concepts or value-add engineering change recommendations to existing
engineering. Our multidisciplinary engineering experience and talent cover a broad spectrum of capabilities, enabling an even more comprehensive
range of projects. Our design engineering capabilities include:
Our broad range
of support of international and domestic governments and commercial companies includes the Netherlands Organization, U.S. Department
of State, the U.S. Department of Defense, NASA, Collins Aerospace, Lockheed Martin, Teledyne Marine, Bechtel, Sierra Space, Intuitive
Machines, OneWeb Satellites, Parsons Corporation, and L3Harris in areas that include but are not limited to launch vehicles, satellites,
and autonomous underwater vehicles.
Technology
Design and Integration: Sidus leverages its manufacturing and technology expertise to address critical space supply chain challenges
with initiatives that are expected to further Sidus’ mission of Space Access Reimagined®, providing flexible and cost-effective
solutions to an expanding global customer base.
Key Achievements
Differentiation:
Our LizzieSat® satellite
platform has been designed to provide a standard, modular satellite platform that serves as the foundation for multiple missions for
Leo, Geo, Cislunar, Lunar and beyond. Additionally, our platform provides differentiated data collection when compared to industry alternatives.
The LizzieSat® multi-mission satellite for a multi-mission constellation leads the next generation of earth and space data collection
by:
The net value of data collected
from our planned LizzieSat® constellation is expected to allow organizations to make better decisions with higher confidence, and
increased accuracy and speed. We expect to enrich this processed data with customizable analytics users control for their own use case,
and in turn provide data as a subscription across industries to organizations so they can improve decision-making and mitigate risk.
Planned services that benefit
current and future customers include delivering space-based data that can provide critical insight for agriculture, commodities tracking,
disaster assessment, illegal trafficking monitoring, energy, mining, oil and gas, fire monitoring, classification of vegetation, soil
moisture, carbon mass, Maritime Automatic Identification System (AIS), Air Traffic Control Automatic Dependent Surveillance, and weather
monitoring; providing the ability for customers to demonstrate that a technology (hardware or software) performs successfully in the
harsh environment of space and delivering space services. Our operating strategy is to continue to capitalize on our smart vertical integration
to enhance the capabilities of our multi-mission satellite constellation, to design and manufacture satellites for government and commercial
customers utilizing our advanced and proprietary technologies, to increase our international and domestic partnerships and to expand
our coincident data analytics offerings in order to increase the value we deliver to our customers. Our two primary operating assets—our
satellite constellation and our manufacturing facility and capability - complement each other and are the result of years of experience
and innovation.
Key Factors Affecting
Our Results and Prospects
We believe that our performance
and future success depend on several factors that present significant opportunities but also pose risks and challenges, including competition
from better known and well-capitalized companies, the risk of actual or perceived safety issues and their consequences for our reputation
and the other factors discussed under “Risk Factors.” We believe the factors discussed below are key to our success.
Expanding Commercial
Satellite Operations
Our goal is to enable customers
to meet their mission objectives with cost-effective solutions and to help them understand how space-based data can be impactful to day-to-day
business. Our strategy includes increasing the demand downstream by starting out as end user focused. While others are focused on a data
verticalization strategy specializing in key sectors or a problem set, we believe that flexibility in production, low-cost, standardized
design and offering ‘Space Access Reimagined’ for consumers will provide a scalable model for growth. In just over twelve
months, we successfully launched and began operations with three LizzieSat® multi-mission satellites for a multi-mission constellation.
Designed to be modular, flexible, and cost-effective, our proven LizzieSat® platform enables rapid mission configuration and scalability
across a wide range of satellite sizes, efficiently addressing unique mission requirements. Built with several proprietary Sidus designs
for reusable core components, our smart vertical integration provides greater control over the supply chain, ensuring seamless integration
of all components—whether developed in-house or sourced externally. This integrated approach offers a distinct advantage over competitors
who rely on purchasing and integrating hardware, software, and subsystems from multiple vendors.
Our existing, proven manufacturing
facility and infrastructure provides scalable and streamlined manufacturing with flexible and efficient cycles tailored to both internal
and external end-users. We ensure controlled product quality and service through the use of space-qualified Commercial Off-the-Shelf
(COTS) components, along with our AS9100 certified capability to manufacture our own space supply chain products. Our modular design
supports flexible technology integration, enabling rapid incorporation of variable sensors and mission-specific technologies. By spreading
fixed costs across multiple customers and capabilities, we offer a more cost-effective solution. As a full-stack space services provider,
our offerings are anchored by a state-of-the-art Mission Control Center (MCC), ensuring end-to-end mission support.
In Q2 2024, we announced
the successful on-orbit activation of the FeatherEdge™ processer which enables us to deliver near real-time intelligence derived
from earth observation data. Further expanding the capabilities of our constellation, we implemented the SatLab A/S second-generation
automated identification system (AIS) technology into the LizzieSat® satellite constellation. AIS technology uses sophisticated systems
on board marine vessels to identify and track ships to prevent collisions and protect life at sea. The integration of this technology,
combined with data from optical sensors on board LizzieSat®, enables unique vessel tracking and monitoring solutions while providing
valuable information about ship movements in real time. In addition to AIS technology, we have integrated visual spectrum and multispectral
imagers into our sensor suite and expect to expand the sensors to include software defined multispectral or hyperspectral sensors for
future satellite missions.
We have previously been
approved for our X-band and S-band radio frequencies licensing through a published filing by the ITU on April 6, 2021. Such licenses
are held through Aurea Alas, Ltd., an Isle of Man company, which is a Variable interest entity to us. The ITU filing contains approved
spectrum use for multiple X-Band and S-Band frequencies and seven different orbital planes, including 45 degrees. In August 2023, the
FCC granted Sidus a LizzieSat® experimental launch and operating license for launch and deploy on a SpaceX Falcon 9 Transporter 10
mission. This license includes approval for orbital operations utilizing the previously approved ITU S-band and X-band frequencies and
ground station coverage. We also received FCC Part 25 license approval for the LizzieSat® satellite constellation missions two through
five in October of 2024. The National Oceanic and Atmospheric Administration (NOAA), an agency of the U.S. Department of Commerce, granted
a Tier 1 license authorizing Sidus to operate LizzieSat, a private remote-sensing space system in 2024.
We currently have several
satellites in production and expect to launch four to six more LizzieSat® satellites ranging from 100kg to 400kg over the next 24
months. In addition, we expect to begin building satellites for other customers including lunar missions.
Any delays in commencing
our commercial launch operations, including delays or cost overruns in obtaining NOAA licenses or other regulatory approvals for future
operations or frequency requirements, could adversely impact our results and growth plans. The exact timing of launches is contingent
on several factors, including satisfactory and timely completion of assembly, integrating and testing of the satellites, regulatory approvals,
confirmation of the launch slot timing by the launch provider, logistics, weather conditions, and other factors, many of which are beyond
our control.
Growing and expanding
our experienced space hardware operations
We are seeking to grow our
space and defense hardware operations, with a goal of expanding from one shift to two and a half shifts and increasing our customer base
in the future. Additionally, we are specifically targeting growth in our avionics and wire harness division to meet the needs of the
commercial and government space industry. With current customers in the space, marine, and defense industries, our contract revenue is
stable, and we are in active discussions with numerous potential customers, including government agencies, large defense contractors
and private companies, to add to our contracted revenue. In the past decade, we have fabricated ground and flight products for the NASA
SLS Rocket and Mobile Launcher as well as other commercial space and satellite companies. We have supported customers such as Boeing,
Lockheed Martin, Northrop Grumman, Dynetics/Leidos, Blue Origin, United Launch Alliance, Collins Aerospace, L3Harris, OneWeb and Space
Systems Loral/Maxar. We have manufactured various products including fluid, hydraulic and pneumatic systems, electrical control systems,
cable harnesses, hardware lifting frames, umbilical plates, purge and hazardous gas disconnects, frangible bolts, reef cutters, wave
guides, customized platforms, and other precision machined and electrical component parts for all types of launch vehicles, ground, flight and
satellite systems.
Vertically Integrated
Space Infrastructure Manufacturing
We are designing, developing,
manufacturing, and operating a constellation of proprietary smallsats in addition to designing and building variations of our satellites
for other customer missions. These satellites are designed for multiple missions and customers and form the foundation of our satellite
platform. Our initial satellites weigh approximately 100 kilograms each and are designed to be more functional than cubesats and nanosatellites
and less expensive to manufacture than our competitors. In addition to our own hybrid 3D printed, modular satellites, we are designing
and manufacturing customized satellites using our standard design for LEO and lunar applications for customers that include government
and commercial entities.
Our cost-effective smallsats
are designed from the ground-up to optimize performance per unit cost. Our model is a movement from highly bespoke, costly satellite
manufacturing techniques to standardized bus with integration of customer requirements at lower costs. We can integrate technologies
and deliver data on demand at lower costs than legacy providers due to our vertical integration, use of commercial off the shelf (COTS)
proven systems, cost-efficiencies, capital efficient satellite design, and adaptable pricing models.
We design and manufacture
satellites at our Cape Canaveral facility. Our current configuration and facility is designed to manufacture multiple satellites per
month. Our vertical integration enables us to control our satellites through the entire design, manufacturing, and operation process.
Our years of experience manufacturing space hardware means we can leverage our manufacturing expertise and commercial best practices
for satellite production. Additionally, leveraging both in-house and partner-provided subsystem components and in-house design and integration
services as well as operational support of satellites on orbit, provides turn-key delivery of satellites to offer “concept to constellation”
in months instead of years. Specifically, our offerings are expected to encompass all aspects of hosted satellite and constellation services,
including hosting customer technologies onto our satellites, and delivering data and constellation services to customers from our space
platform. These services are expected to allow customers to focus on developing innovative technologies rather than having to design
or develop complete satellite buses or constellations. Additionally, we provide ancillary services that include telemetry, tracking and
control, communications, processing, as well as software development and maintenance.
Our patented space-related
technologies include a print head for regolith-polymer mixture and associated feedstock; a heat transfer system for regolith; a method
for establishing a wastewater bioreactor environment; vertical takeoff and landing pad and interlocking pavers to construct same; and
high-load vacuum chamber motion feedthrough systems and methods. Regolith is a blanket of unconsolidated, loose, heterogeneous superficial
deposits covering solid rock. It includes dust, broken rocks, and other related materials and is present on earth, the moon, Mars, some
asteroids, and other terrestrial planets and moons. We continue to patent our products including our satellites, external platforms and
other innovations. Sidus holds 14 granted patents and 13 pending applications.
Revenue Generation
We generate revenue by selling
technology space on our satellite platform, providing engineering and systems integration services to strategic customers on a project-by-project
basis, and manufacturing space hardware for other space and defense entities to include satellites. Additionally, we intend to add to
our revenue by selling geospatial data and actionable intelligence captured through our constellation. This support is typically contracted
to both commercial and government customers under fixed price contracts and often includes other services. Due to the size and capacity
of our satellite, we plan to expand the diverse array of sensors on each satellite such as Multispectral and Hyperspectral Earth Observing
Imagers, Maritime Vessel RF Tracking receivers, UHF IoT Transceivers, Optical Communications systems, and others. Integrating multiple
sensors and technologies on a single multi-mission satellite can simultaneously address the needs of multiple customers and their requirements.
Lowering Manufacturing
Cost and Schedule
We have developed a manufacturing
model that provides rapid response to customer requirements including integration of customers technologies for space-based data delivery.
Our satellites are designed to integrate COTS subsystems that are space-proven, can be rapidly integrated into the satellite and replaced
rapidly when customer needs change or evolve. Our vertically integrated manufacturing processes give us the flexibility to make changes
during the production cycle without impacting launch or costs.
Environmental, social,
and corporate governance
What changed in the latest 10-Q
Risk Factors
Risk factors that affect our business and financial results are discussed in Part I, Item 1A “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2025 (“Annual Report”). There have been no material changes in our risk factors from those previously disclosed in our Annual Report. You should carefully consider the risks described in our Annual Report, which could materially affect our business, financial condition or future results. The risks described in our Annual Report are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and/or operating results. If any of the risks actually occur, our business, financial condition, and/or results of operations could be negatively affected.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “Six Months Ended June 30, 2026 compared to the Six Months Ended June 30, 2025”
New heading “Cost of Revenue”
New heading “Gross Profit (Loss)”
New heading “Selling, General, and Administrative Expenses”
New heading “Total other income (expenses)”
New heading “April and May 2026 Public Offerings”
Removed heading “Lunar and GEO Program Progress:”
Largest changes
“In 2024 and 2025, we completed commissioning of FeatherEdge™ GEN-2 and activated AI edge-computing capabilities on all three LizzieSat® satellites. Further expanding the capabilities of our satellite fleet, we implemented the SatLab A/S second-generation automated identification system (AIS) technology into the LizzieSat® satellite fleet. AIS technology uses sophisticated systems on board marine vessels to identify and track ships to prevent collisions and protect life at sea. …”see in full comparison
Thesee in full comparison36%39% improvement in our gross loss for the three months endedMarchJune31,30, 2026 to a loss of approximately$1.1 million$630,000 as compared to a losslossof approximately$1.6$1.0 million for the three months endedMarchJune31,30, 2025, was driven primarily byhigher revenue andlower satellite and related software depreciation costsfollowingandthereducedsatellitecontractimpairmentmaterialwrite-offandinlaborQ4expenses,2025.partially offset by lower revenue.
“Six Months Ended June 30, 2026 compared to the Six Months Ended June 30, 2025”see in full comparison
Full comparison: every changed paragraph (52)
Throughout
this Quarterly Report on Form 10-Q, references to “we,” “our,” “us,” the “Company,” “Sidus,”
or “Sidus Space” refer to Sidus Space, Inc., individually, or as the context requires, collectively with its subsidiary.consolidated
variable interest entity.
Sidus
Space operates as a vertically integrated space and defense technology company providing satellite design and manufacturing, technology
integration, mission operations, artificial intelligence-enabledintelligence-enabling products and services, and space-based data solutions to government,
defense, intelligence, and commercial customers. Our operations are supported by in-house engineering, manufacturing, assembly, integration,
testing, and mission control capabilities.
During
the three months ended MarchJune 31,30, 2026, our operating activities were focused on advancing satellite programs, supporting customer manufacturing
and engineering contracts, expanding mission operations capabilities, and continuing to invest in artificial intelligence-enabledintelligence-enabling computing
and data processing technologies. These initiatives required significant upfront investment in personnel, infrastructure, product development,
and regulatory compliance, which impacted operating results and liquidity during the period.
Sidus
delivers an integrated portfolio of satellite platforms, AI-enabledAI-enabling computing systems, precision manufacturing capabilities, mission
operations services, and regulatory support that collectively enable end-to-end space and defense solutions. Through vertically integrated
engineering, advanced manufacturing, and flight-proven technologies, Sidus provides flexible and scalable offerings to commercial, government,
defense, and intelligence customers.
AIAI-Enabling
Enabled Edge Computing Systems:
Lunar
and GEO Program Progress:
In
2024 and 2025, we completed commissioning of FeatherEdge™ GEN-2 and activated AI edge-computing capabilities on all three LizzieSat®
satellites. Further expanding the capabilities of our satellite fleet, we implemented the SatLab A/S second-generation automated identification
system (AIS) technology into the LizzieSat® satellite fleet. AIS technology uses sophisticated systems on board marine vessels to
identify and track ships to prevent collisions and protect life at sea. The integration of this technology, combined with data from optical
sensors on board LizzieSat®, enables unique vessel tracking and monitoring solutions while providing valuable information about ship
movements in real time. In addition to AIS technology, we have integrated visual spectrum and multispectral imagers into our sensor suite
and expect to expand the sensors to include software defined multispectral or hyperspectral sensors for future satellite missions.
The
Company maintains regulatory authorizations from the FCC, NOAA, and ITU supporting current and planned satellite missions. These authorizations
enable our current on-orbit operations and support future satellite deployments across LEO, GEO, cislunar, and lunar mission plans.
We
currently have several satellites in production and expect to launch 2-3 LizzieSat® satellites ranging from 100kg to 400kg over the
next three years. We are also actively building satellites for additional customer missions, including under our Lonestar Holdings lunar
satellite manufacturing program.
Our
patented space-related technologies include a print head for regolith-polymer mixture and associated feedstock; a heat transfer system
for regolith; a method for establishing a wastewater bioreactor environment; vertical takeoff and landing pad and interlocking pavers
to construct same; and high-load vacuum chamber motion feedthrough systems and methods. Regolith is a blanket of unconsolidated, loose,
heterogeneous superficial deposits covering solid rock. It includes dust, broken rocks, and other related materials and is present on
earth, the moon, Mars, some asteroids, and other terrestrial planets and moons. We continue to patent our products including our satellites,
external platforms and other innovations. We hold 1516 issued U.S. patents and 1110 pending patent applications as of MarchJune 31,30, 2026.
Continue
to penetrate international markets. We have expanded our strategic focus to include international markets, actively building a pipeline
of prospective partnerships with small, underrepresented governments and global companies that can benefit from our expertise and services.
As part of this initiative, we have signedentered partnershipinto customer agreements with companies in Germany, Japan, India, Spain, the Netherlands, and Israel, and non-binding
Belgiummemoranda toof exploreunderstanding potentialwith jointcompanies venturein opportunities.India, Belgium, Germany, Japan, and Israel. We remain actively engaged with counterparties
in each of these markets.
Comparison
of quarter ended MarchJune 31,30, 2026, to quarter ended MarchJune 31,30, 2025
Total
revenue for the three months ended MarchJune 31,30, 2026 increaseddecreased approximately $121,000 or 51%$678,000 compared to the three months ended MarchJune 31,
30, 2025. Non-related
party revenue increaseddecreased by approximately 56%23% for the three months ended MarchJune 31,30, 2026, to approximately $250,000$531,000 as
compared to approximately $161,000
$691,000 for the three months ended MarchJune 31,30, 2025. This was primarily driven by the addition of new customer
contracts including Lonestar Data Holdings and Teledyne Marine. Related party revenue increaseddecreased 40%91% to approximately $109,000$52,000 for the
three months
ended MarchJune 31,30, 2026 versus approximately $78,000$570,000 for the three months ended MarchJune 31,30, 2025. ThisThese waschanges influencedwere primarily driven by increasedthe
worktiming performedof forfixed-price ourmilestone related party as their contract activity grew.contracts.
Cost
of revenue decreased 25%47% for the three months ended MarchJune 31,30, 2026 to approximately $1.4$1.2 million as compared to approximately $1.9$2.3 million
for the three months ended MarchJune 31,30, 2025 and included approximately $31,000$132,000 related party cost of sales for the three months ended MarchJune
31,30, 2026 and approximately $38,000$318,000 for the three months ended MarchJune 31,30, 2025. The overall decrease in cost of revenue was primarily driven
by a lower volume of contract activity and a decrease in satellite and related software depreciation expense and improved cost discipline in the manufacturing side of our business.expense.
The
36%39% improvement in our gross loss for the three months ended MarchJune 31,30, 2026 to a loss of approximately $1.1 million$630,000 as compared to a loss
loss of approximately $1.6$1.0 million for the three months ended MarchJune 31,30, 2025, was driven primarily by higher revenue and lower satellite
and related software
depreciation costs followingand thereduced satellitecontract impairmentmaterial write-offand inlabor Q4expenses, 2025.partially offset by lower revenue.
Selling,
general, and administrative expenses decreasedincreased approximately $25,000$799,000 (less than 1%19%) when compared with the same period in 2025. This
was primarily
due to the following:
Other
income and (expenses) showedimproved aby changeapproximately $1.2 million to net other income of approximately $258,000 in 2026$910,978 compared to net other expense of approximately
$342,000$334,659 in 2025,2025.
The change was primarily due to approximately $912,000 of interest income earned on higher cash balances following our 2026 equity offerings,
together with the elimination of asset-based loan expense following the payoffrepayment of the asset-based loan in January
2026 and increased interest income from cash holdings.2026.
Six Months Ended June 30, 2026 compared to the Six Months Ended June 30, 2025
Revenue
Total revenue for the six months ended June 30, 2026 decreased approximately $557,000 compared to the six months ended June 30, 2025. Non-related party revenue decreased by approximately 8% for the six months ended June 30, 2026, to approximately $781,000 as compared to approximately $852,000 for the six months ended June 30, 2025. Related party revenue decreased 75% to approximately $161,000 for the six months ended June 30, 2026 versus approximately $648,000 for the six months ended June 30, 2025. These changes were primarily driven by the timing of fixed-price milestone contracts.
Cost of Revenue
Cost of revenue decreased 37% for the six months ended June 30, 2026 to approximately $2.6 million as compared to approximately $4.2 million for the six months ended June 30, 2025 and included approximately $163,000 related party cost of sales for the six months ended June 30, 2026 and approximately $356,000 for the six months ended June 30, 2025. The overall decrease was primarily driven by lower contract volume and a decrease in satellite and related software depreciation expense.
Gross Profit (Loss)
The 37% improvement in our gross loss for the six months ended June 30, 2026 to a loss of approximately $1.68 million as compared to a loss of approximately $2.66 million for the six months ended June 30, 2025, was driven primarily by lower satellite and related software depreciation costs and reduced contract material and labor expenses.
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses increased approximately $774,000 (9%) when compared with the same period in 2025. This was primarily due to the following:
Total other income (expenses)
Other income and (expenses) improved by approximately $1.8 million to other income of $1,169,081 compared to other expense of $676,366 in 2025. The change was primarily due to approximately $1.1 million of interest income earned on higher cash balances following our 2026 equity offerings, together with a substantial reduction in asset-based loan expense following repayment of the loan in January 2026.
The
following table reconciles adjusted EBITDA to net loss (the most comparable GAAP measure) for the three months ended MarchJune 31,30, 2026 and
2025:
The following table reconciles adjusted EBITDA to net loss (the most comparable GAAP measure) for the six months ended June 30, 2026 and 2025:
The
following table provides selected financial data about us as of MarchJune 31,30, 2026, and December 31, 2025
Liquidity
is the ability of a company to generate funds to support asset growth, satisfy disbursement needs, maintain reserve requirements, and
otherwise operate on an ongoing basis. We had insufficientOur operating revenues,revenues sohave wenot arebeen currently dependent on debt financing and sale
of equitysufficient to fund operations.our operations, and we have historically
financed our operations through sales of equity securities and, prior to January 2026, borrowings. Following the completion of our April
2026 and May 2026 registered direct offerings and the repayment in full of our asset-based loan in January 2026, we had no outstanding
indebtedness as of June 30, 2026 and expect to fund our operations and planned capital expenditures from cash on hand.
We
had an accumulated deficit of approximately $95.0$99.8 million and working capital of approximately $29.3$167.6 million as of MarchJune 31,30, 2026 compared
to accumulated deficit of approximately $89.8 million and working capital of approximately $35.7 million as of December 31, 2025. As
of MarchJune 31,30, 2026, we had approximately $27.3$166.5 million of cash as compared to approximately $43.2 million as of December 31, 2025.
As
of DecemberJune 31,30, 20252026, theour working capital surplus was primarily due to fundsnet proceeds of approximately $146.2 million raised in our capitalApril raises completed in Q3 2026
and Q4May 2025.
As2026 ofregistered Marchdirect 31,offerings, 2026,partially ouroffset working capital reflects the use ofby cash forused to fund operations and the repaymentbuild-out of theour asset-basedLizzieSat loan in January
2026.satellites.
Current
assets decreasedincreased by approximately $17.3$122.1 million to approximately $33.4$172.8 million as of MarchJune 31,30, 2026 from approximately $50.7 million
as of December 31, 2025. The decreaseincrease is primarily attributable to thean useincrease ofin cash tofrom repayour the2026 asset-basedequity loan and fund operations.offerings.
Current
liabilities decreased significantly to approximately $4.1$5.2 million as of MarchJune 31,30, 2026 fromversus approximately $15.0 million as of December
31, 2025. The decrease is2025, primarily attributable
related to the repayment of theour asset-based loan liability in January 2026 and the repayment of related
party advances.2026.
April and May 2026 Public Offerings
On April 21, 2026, we completed a registered direct offering of 11,228,700 shares of Class A common stock and pre-funded warrants to purchase 2,225,000 shares, at an offering price of $4.35 per share, for gross proceeds of approximately $58.5 million and net proceeds of approximately $53.9 million. In connection with the offering, we issued warrants to the placement agent to purchase 961,540 shares of Class A common stock at an exercise price of $5.4375 per share. All of the pre-funded warrants were exercised during the quarter, resulting in the issuance of 2,224,933 shares.
On May 27, 2026, we priced a registered direct offering of 16,485,038 shares of Class A common stock and pre-funded warrants to purchase 3,200,001 shares, at an offering price of $5.08 per share, for gross proceeds of approximately $100.0 million and net proceeds of approximately $92.3 million. The offering closed on May 29, 2026. In connection with the offering, we issued warrants to the placement agent to purchase 984,252 shares of Class A common stock at an exercise price of $6.35 per share. All of the pre-funded warrants were exercised, resulting in the issuance of 3,200,001 shares.
Dilution
Shares of Class A common stock outstanding increased from 65,324,055 at December 31, 2025 to 101,106,203 at June 30, 2026, an increase of 35,782,148 shares, or 55%.
Net proceeds from the two offerings of approximately $146.2 million represented approximately $4.41 per share issued in those offerings.
As of June 30, 2026, we also had outstanding warrants to purchase 3,584,073 shares of Class A common stock at a weighted average exercise price of $4.66, options to purchase 286,643 shares at a weighted average exercise price of $3.67, and 232,947 unvested restricted stock units. These securities were excluded from the computation of diluted net loss per share because their effect would have been anti-dilutive.
ThreeSix
Months ended MarchJune 31,30, 2026 and 2025
For
the threesix months ended MarchJune 31,30, 2026, net cash flows used in operating activities was approximately $5.6$9.11 million compared to approximately
$3.2$7.85 million during the threesix months ended MarchJune 31,30, 2025.
Cash
flows used in operating activities for the threesix months ended MarchJune 31,30, 2026 of approximately $5.6$9.11 million is comprised of a net loss of
of approximately $5.2$9.99 million, which was reduced by non-cash expenses of approximately $215,000$197,000 for stock-based compensation,compensation and approximately
$612,000$1.22 million for depreciation, and apartially decreaseoffset by an increase in net working capital of approximately $1.3 million.$534,000.
Cash
flows used in operating activities for the threesix months ended MarchJune 31,30, 2025 of approximately $3.2$7.8 million is comprised of a net loss of
of approximately $6.4$12.0 million, which was reduced by non-cash expenses of approximately $252,000$437,000 for stock-based compensation andcompensation, approximately
$935,000$2.1 million for depreciation, approximately $20,000 of non-cash fees on the asset-based loan and a decrease in net working capital of approximately
$2.0 $1.7 million.
During
the threesix months ended MarchJune 31,30, 2026 and 2025, Sidus Spacewe invested approximately $3.7$7.33 million and $3.0$4.35 millionmillion, respectively, in property and
and equipment primarily related to purchasing satellite related components and software.
During
the three months ended March 31, 2026, net cash used in financing activities of approximately $6.5 million primarily consisted of the
repayment of the asset-based loan of approximately $8.2 million, partially offset by proceeds from the exercise of warrants of approximately
$1.7 million.
During
the threesix months ended MarchJune 31,30, 2025,2026, net cash provided inby financing activities of approximately $2.2$139.79 million included net proceeds from
the exercise of warrantsapproximately $146.22 million from our DecemberApril 20242026 capitaland raiseMay 2026 registered direct offerings and approximately $1.79 million from the
exercise of warrants, partially offset by repayment of the asset-based loan of approximately $2.4 million and net proceeds of approximately $2.9 million
from an asset-based loan and repayment of notes payable of approximately $3.1$8.21 million.
During the six months ended June 30, 2025, net cash provided by financing activities of approximately $131,000 included proceeds from the exercise of warrants from our December 2024 capital raise of approximately $2.4 million and proceeds from our asset-based loan of approximately $4.4 million, partially offset by repayments of our asset-based loan of approximately $3.6 million and repayments of notes payable of approximately $3.1 million.
WeThe
Company adopted ASC 606 – Revenue from Contracts with Customers using the modified retrospective transition approach. The core
principle principle
of ASC 606 is that revenue should be recognized in a manner that depicts the transfer of promised goods or services to customers
in an
amount that reflects the consideration to which the entity expects to be entitled for exchange of those goods or services. Our
updated updated
accounting policies and related disclosures are set forth below, including the disclosure for disaggregated revenue. The impact
of adopting
ASC 606 was not material to the Consolidated Financial Statements.
SIDU insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-07-01 | Norwood Tiffany Ann |
Option exercise | 2,047 | — | — |
| 2026-07-01 | Riera Leonardo |
Option exercise | 4,749 | — | — |
| 2026-07-01 | Shuman Jeffrey S |
Option exercise | 16,621 | — | — |
| 2026-07-01 | Coffey Lavanson |
Option exercise | 7,124 | — | — |
Well-known investors holding SIDU (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 1,752,690 | $4.9M | 0.0% | New position |
| Renaissance Technologies | 2026-06-30 | 1,172,428 | $3.3M | 0.0% | New position |
| Millennium Management (Israel Englander) | 2026-06-30 | 613,198 | $1.7M | 0.0% | Added 38% |
| Two Sigma Investments | 2026-06-30 | 132,294 | $371.7K | 0.0% | New position |