What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-17 compared with 2025-03-20 · 288 added, 269 removed, 208 unchanged (73% of the section changed)

3 unchanged sentences

Factors that could cause or contribute to these differences include, but are not limited to, those discussed in the section titled “Risk Factors” under Part I, Item IA in this Annual Report on Form 10-K.

Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “BlackSky,” “the Company,” “we,” “us” and “our” refer to the business and operations of Legacy BlackSky and its consolidated subsidiaries prior to the Merger and to BlackSky Technology Inc.

(“Legacy BlackSky”) and its consolidated subsidiaries prior to the completion of its merger on September 9, 2021 with a wholly-owned subsidiary of Osprey Technology Acquisition Corp.

(the “Merger”) and of BlackSky Technology Inc.

and its consolidated subsidiaries, following the closing of the Merger.

In September 2024, we effected a one-for-eight reverse stock split (the “Reverse Stock Split”) of our issued Class A common stock, par value $0.0001 per share (“common stock”).

As a result, every eight shares of our issued common stock were combined into one share of our common stock.

No fractional shares of our common stock were issued as a result of the Reverse Stock Split.

Each stockholder who would otherwise have been entitled to receive a fractional share as a result of the Reverse Stock Split received a cash payment equal to the product obtained by multiplying the number of shares of our common stock held by such stockholder before the Reverse Stock Split that would otherwise have been exchanged for such fractional share interest by the closing price per share of our common stock as reported on the New York Stock Exchange (“NYSE”) on September 6, 2024, the date of the effective time of the Reverse Stock Split.

As a result of the Reverse Stock Split, proportionate adjustments were made to the per share exercise price and the number of shares issuable upon the exercise of all outstanding warrants to purchase shares of our common stock.

This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” gives retroactive effect to the Reverse Stock Split for all periods presented.

The shares of common stock retained a par value of $0.0001 per share.

Company Overview

BlackSky is a space-based intelligence company that delivers real-time imagery, analytics and high-frequency monitoring of the world’s most critical and strategic locations, economic assets, and events.

Founded in 2014, BlackSky is a space technology company that delivers real-time imagery, analytics and high-frequency monitoring of the world’s most critical and strategic locations, economic assets, and events.

By taking a software-first technology approach, we are delivering real time space-based intelligence at disruptive speed, scale and economics.

BlackSky is trusted by many of the most demanding U.S.

and international government agencies and commercial businesses around the world.

We are defining a new category of space-based intelligence products and services with real-time imagery and automated analytics, delivered through an easy-to-use interface coupled with our high-revisit and low latency satellite constellation both designed to help customers see, understand and anticipate change for a decisive strategic advantage.

We own and operate one of the industry's leading high-performance low earth orbit ( “ LEO ” ) small satellite constellations.

Our constellation is optimized to cost-efficiently capture imagery at high revisit rates where and when our customers need it.

Because of its orbital configuration, our constellation is able to image certain locations on average in under 90 minutes, from dawn-to-dusk, providing our customers with insights and situational awareness over specific locations of interest throughout the day.

The constellation is optimized for agility and capacity and delivers high revisit imaging and analytic products without a dependency on an individual satellite.

This approach enables us to strategically deploy capacity to meet customer needs and tailor the capability over time to meet market demand.

We believe that our focus on critical strategic and economic infrastructure and our proprietary artificial intelligence (“AI”)-enabled tasking methodology differentiates us from many of our competitors, who are primarily dedicated to mapping the entirety of the Earth on a routine basis.

Our differentiated approach to space enables us to deliver highly targeted and valuable intelligence with a smaller constellation fleet that has the added benefit of greater operating and capital efficiencies.

BlackSky’s constellation provides unique value with the ability to collect imagery and analytics from dawn-to-dusk at a higher cadence and at lower cost than traditional providers.

and allied militaries rely on our services for high-revisit monitoring of airfields, vehicle depots, troop movements, and other high-value locations to detect changes in pattern-of-life.

BlackSky can distinguish landscape features such as roads and buildings, and gauge

commercial activities and patterns in ship or aircraft movements, progress at construction sites, and changes in production by estimating the number of cars in a parking lot.

Our proprietary constellation can produce high and very-high resolution electro-optical imagery resolution and short-wave infrared imagery for expanded imaging capabilities in low-light or nighttime.

The constellation also has advanced data communications capabilities that significantly increase the end-to-end delivery speed of intelligence products.

We believe these advanced features improve our analytics and increase the value we can deliver to our customers.

Our BlackSky Spectra software platform can, among other things, process millions of observations a day from our proprietary satellite constellation and from multiple external data sources including imaging, radar and radio frequency satellites, environmental sensors, asset tracking sensors, Internet-of-Things connected devices, internet-enabled narrative sources, and a variety of geotemporal data feeds.

BlackSky Spectra employs advanced, proprietary AI and machine learning (“ML”) techniques to process, analyze, and transform these data feeds into alerts, information, and insights that our customers receive, all fully automated.

Customers can access BlackSky Spectra's data and analytics through easy-to-use web services or through platform APIs.

The combination of our high-revisit, small satellite constellation, our BlackSky Spectra platform, and low constellation cost is transforming the market for real-time, space-based imagery and analytics.

Our operating strategy is to continue to enhance the capabilities of our satellite constellation, to increase the data processed by our BlackSky Spectra platform, and to expand our analytics offerings in order to increase the value we deliver to our customers.

Our two strategic assets—our satellite constellation and our BlackSky Spectra platform—are mutually reinforcing:

as we capture more information about the world’s most important strategic and economic assets and locations, our proprietary database expands and increases its utility, enabling us to better detect, understand, and predict changes that matter most to our customers.

As such, we believe that our business will benefit from a natural and powerful “flywheel” effect:

the more data we collect and analyze, the more valuable the insights we can deliver to our customers.

Our current customer base and end market mix are weighted towards U.S.

and international defense and intelligence customers and markets.

We believe there are significant opportunities to expand our imagery and software analytical services, as well as our professional and engineering service offerings, to a broad set of customers both domestically and internationally.

In addition, our services and products can benefit customers in a variety of commercial markets including, but not limited to, energy and utilities, insurance, commodities, mining, manufacturing, logistics, supply chain management, agriculture, environmental monitoring, disaster and risk management, engineering and construction, and retail and consumer behavior.

We generate revenue by selling subscription-based On-Demand and Assured product and service offerings that support national security, supply chain intelligence, crisis management, critical infrastructure monitoring, economic intelligence, and others.

These offerings include a variety of pricing options accessible via our subscription plan through our BlackSky Spectra software platform, plus professional and engineering services provided to customers on a project-by-project basis.

We offer a range of pricing tiers that enables the customer to manage collection priorities, when during critical events they can pay a premium to prioritize their monitoring and collection requirements.

At other times, customers can select lower priority collections to allow for more economical utilization.

Variable and fixed price plans allow our customers to choose what matters most to them—platform licensing-levels, priority for imagery tasking, and whether to apply analytics or monitoring capabilities overtop the imaging service.

On November 6, 2024, we acquired the remaining 50% of common units of LeoStella LLC (“LeoStella”) and LeoStella became a wholly-owned subsidiary of BlackSky.

The acquisition allows us to improve control over the Gen-3 satellite supply chain and production operations.

We have manufacturing capacity to produce up to 40 satellites per year.

This vertical integration enables BlackSky to control our satellites through the entire design, manufacturing, and operation process and optimize performance per unit cost.

LeoStella's financial results have been included in our operating results for the period following the acquisition date.

We are defining a new category of space-based intelligence products and services centered upon real-time imagery and automated analytics, delivered through an easy-to-use interface that operates seamlessly with our high-revisit and low latency satellite constellation.

Our first-of-its-kind, purpose-built, secure artificial intelligence ("AI")-enabled space-to-ground architecture helps customers see, understand and anticipate change for a decisive strategic advantage.

BlackSky can provide dynamic hourly monitoring over many of the most strategic locations on Earth up to 15 times per day from dawn to dusk.

BlackSky designs, builds, owns and operates the industry’s most advanced, purpose-built commercial, real-time intelligence system that combines the power of the BlackSky Spectra® tasking and analytics software platform with our high resolution, low earth orbit ("LEO") small satellite (“smallsat” or “smallsats”) constellation.

Our Gen-3 satellites (“Gen-3”) include significantly enhanced capabilities, including 35-centimeter electro-optical imaging resolution and 1-meter short-wave infrared imaging technology for expanded imaging capabilities in low-light or at night.

The Gen-3 constellation also features improved data communications capabilities that significantly increase the end-to-end delivery speed of intelligence products.

BlackSky Spectra is a first-of-its-kind commercial tasking, analytics and multi-intelligence data-fusion software platform that helps customers monitor activities from space.

The BlackSky constellation is the primary on-orbit data source and communications architecture that delivers space-based information to BlackSky Spectra.

BlackSky’s satellites fly in unconventional, inclined orbits, and with built-in automated systems.

Our constellation can deliver time-diverse, dawn-to-dusk, rapid revisit imagery, and analytics— with no humans in the loop.

BlackSky Spectra provides end users the ability to augment proprietary data collected from our constellations with input from third-party sensors.

Customers experience the value of BlackSky’s space-based intelligence and AI capabilities through subscription-based On-Demand and Assured product offerings.

Our Mission Solutions offering allows customers the ability to acquire, own, and operate their own customized Gen-3 satellite(s) and space-to-ground system(s).

These solutions leverage our industry-leading, end-to-end satellite to ground infrastructure hardware and software technology stack.

BlackSky Mission Solutions give nations the flexibility of owning space assets while having scalable access to additional capacity through BlackSky’s proprietary constellation.

BlackSky also offers advanced technology program services that allow customers to conduct advanced R&D using aspects of BlackSky’s space-to-ground system that further enhance the capabilities that we can offer certain customers, or that further integrates BlackSky’s intelligence products into customer secure operational workflows.

Our product and service offerings are designed to provide synergy to our customers.

For example, when our Mission Solutions offerings are acquired in conjunction with our subscription data services, customers enjoy the benefits of speed, scale and reliability without having to own and operate a large constellation.

Collectively, our offerings create a unified value proposition that

supports national security, supply chain resilience, economic intelligence, and other critical decision-making requirements for customers worldwide.

In November 2024, we acquired the remaining 50% of the common units of BlackSky Satellite Systems LLC, f/k/a LeoStella LLC, (“BlackSky Satellite Systems” or “LeoStella”), which is now a wholly-owned subsidiary of BlackSky.

The acquisition resulted in a vertical integration that enables us to improve control over our Gen-3 satellite supply chain and production operations by controlling our satellites through the entire design, manufacturing, and operation process, thereby optimizing performance per unit cost.

BlackSky Satellite Systems's financial results are included in our operating results for the periods following the acquisition date.

In July 2025, we issued $185.0 million aggregate principal amount of Convertible Senior Notes due August 1, 2033 (the “Convertible Senior Notes”) in a private offering.

With the proceeds from the issuance of the Convertible Senior Notes, we repaid all principal and accrued interest from the loans from related parties and the commercial bank line.

See “—Liquidity and Capital Resources” and Note 15—“Debt and Other Financing” for further detail.

We expect the Convertible Senior Notes will increase our liquidity, strengthen our balance sheet, and put us in a position to unlock additional growth opportunities

Components of Operating Results

Our revenue is generated by selling imagery and software analytics services through our BlackSky Spectra platform and by providing professional and engineering services to strategic customers on a project basis.

• Imagery and Software Analytical Services Revenue

We offer our customers high-revisit, on-demand high resolution electro optical satellite imaging services.

Through our BlackSky Spectra software platform, customers can directly task our proprietary satellite constellation to collect and deliver imagery over specific locations, sites, and regions that are critical to their operations.

We offer customers several service level options that include annual plans for access to capacity subscriptions for on-demand tasking or multi-year assured access programs, where customers can secure priority access and imaging capacity at a premium over a region of interest on a take or pay basis.

◦ Data, Software, and Analytics:

Our analytics services are also offered on a subscription basis and provide customers with access to our site monitoring, event monitoring and global data services.

We leverage our proprietary AI and ML algorithms to analyze data coming from both our proprietary sensor network and third-party space sources in real-time to provide data, insights, and analytics for our customers.

We provide services related to object, change and anomaly detection, site monitoring, and enhanced analytics through which we can detect key pattern of life changes in critical locations.

These critical locations can include strategic locations and infrastructure such as ports, airports, and construction sites;

Our revenue is generated by selling space-based intelligence & AI services through our BlackSky Spectra software platform and by providing mission solutions and advanced technology programs to strategic customers on a project basis.

• Space-Based Intelligence and AI Services Revenue:

We offer high-revisit, high-resolution, satellite imaging products including dawn-to-dusk, 35 cm resolution electro-optical and nighttime imagery.

Through our BlackSky Spectra software platform, customers can directly task our constellation to collect and deliver imagery over specific locations, sites, and regions that are critical to their operations.

Customers also have access to multi-frame area 2x1 to capture areas larger than the single frame scene size, like large airports or large ports, burst to analyze motion with five frames collected in a single satellite pass, and stereo pairs (two frames) or sets (fives frames) to build and update 3D products on short timelines.

All imagery products are included in our On-Demand and Assured subscription plans.

BlackSky also offers non-Earth imagery services for monitoring orbiting spacecraft and other objects of interest.

Our AI-generated analytics are also offered on a subscription basis and provide customers with automated access to our site monitoring, event monitoring, and global data services.

Our object change and anomaly detection, site monitoring, and enhanced analytics services can detect key pattern-of-life changes in critical locations.

These critical locations include infrastructure, such as maritime ports, airfields, and construction sites;

retail activity;

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and other sites that contain critical commodities and supply chain inventory.

We expect continued revenue growth in our offerings year over year as a result of increases in our sales orders with new customers and incremental sales orders driven by stronger customer demand with existing customers.

• Professional and Engineering Services Revenue— We develop and deliver advanced satellites and payload systems for specific strategic customers that desire to leverage our capabilities in mission systems engineering and operations, ground station operations, software, analytics and systems development.

Our AI-enabled analytics provide for the automated detection and classification of more than 30 objects of tactical interest.

We generally structure our customer agreements as annual or multi-year subscription contracts.

We offer pricing tiers that enable the customer to manage collection priorities.

These options provide customers with flexibility to utilize our space-based intelligence and AI services in a manner that best suits their business needs.

For example, during critical events, customers may pay a premium to prioritize their monitoring and collection requirements, while at other times, customers can select lower priority collections to allow for more economical use of their overall subscription.

• Mission Solutions Revenue:

We develop and deliver customized advanced satellites and payload systems for specific strategic customers that desire to leverage our capabilities in mission systems engineering and operations, ground station operations, software, analytics and systems development.

By integrating our Gen-3 satellites, secure ground infrastructure, launch support, operations software, and training, this offering delivers rapid access to actionable intelligence, enhances mission continuity in secure or air-gapped environments, and supports national self-reliance in defense decision-making.

Mission solutions empower customers to retain ownership and custody of satellites, tasking, and data while operating within their own borders and security frameworks.

With proven, military-grade technology, globally distributed

manufacturing, high-availability on-orbit performance, and transfer-of-knowledge programs that develop local workforce expertise, we enable partners to confidently build, operate, and evolve customized sovereign space architectures that strengthen national security and modern deterrence.

These systems are sold to government customers under fixed price contracts and are often sold with operating and imagery service subscriptions.

We retain rights to intellectual property for developed technology of certain systems.

We also provide technology enabled professional service solutions, which are highly-interrelated, to support customer-specific feature requests and to support the integration, testing, and training of our imagery and software analytical services into the customer's organizational processes and workflows.

We also provide software systems engineering development services to support the integration of high volume and mass quantities of data in their operating platforms.

We expect continued meaningful contribution from our professional and engineering services revenue, which we expect will be primarily from contracts with existing U.S.

and international defense and intelligence customers with whom we have contracted to perform development work prior to the implementation of their subscription service contracts.

• Advanced Technology Programs Revenue:

We provide advanced technology solutions that enhance customer adoption and operational integration of our technology.

These services include support for customer-specific software feature development, systems testing, and training, as well as the integration of our imagery and analytics products into a customer’s existing processes and workflows.

These services can also include the development and expansion of our current sensor capabilities.

Through these services, we help customers tailor, expand and optimize their use of our platforms and mission capabilities.

Mission solutions and advanced technology programs revenue contain estimates that may result in the recognition of revenue in a current period for performance obligations that were satisfied or partially satisfied in a prior period.

For the impacts of changes in estimates on our contracts, see Note 2—“Basis of Presentation and Summary of Significant Accounting Policies” of the notes to the consolidated financial statements contained within this Annual Report on Form 10-K.

Costs and Expenses

Our costs and expenses are incurred from the following categories:

• Imagery and software analytical services costs primarily include third-party data and imagery, ground station service payments, and internal labor to support the ground stations and space operations.

Costs are expensed as incurred except for incremental costs to obtain a contract, which are primarily sales commissions on contracts greater than one year and are capitalized and amortized to selling, general, and administrative expenses on a systematic basis consistent with the transfer of goods and services and directly identifiable costs to fulfill a contract.

Expense related to stock-based payments is classified in the consolidated statements of operations and comprehensive loss based upon the classification of each

employee's cash compensation.

We recognize stock-based compensation expense for those employees whose work supports the imagery and software analytical services costs we provide to customers, under imagery and software analytical service costs, excluding depreciation and amortization.

• Professional and engineering service costs primarily include the cost of internal labor for design and engineering in support of long-term development contracts for customer satellites and payload systems as well as subcontract direct materials and external labor costs to build and test specific components, such as the communications system, payload demands, and sensor integration.

In addition, we recognize internal labor costs and external subcontract labor costs for our customer-centric software service solutions.

We also recognize stock-based compensation expense for those employees who provide professional and engineering services support to customers, under professional and engineering service costs, excluding depreciation and amortization.

Our costs and expenses, which includes stock-based compensation expense for those employees who support each category, are incurred from the following categories:

• Space-Based Intelligence & AI services Costs:

primarily include third-party data and imagery, ground station service payments, internal labor to support our ground stations and space operations, and compute/storage costs to facilitate our expanding AI/ machine learnings ("ML") functionality.

Costs are expensed as they are incurred except for incremental costs to obtain a contract, which are primarily sales commissions on contracts greater than one year, are capitalized and amortized to selling, general, and administrative expenses on a systematic basis consistent with the transfer of goods and services and directly identifiable costs to fulfill a contract.

Expense related to stock-based payments is classified in the consolidated statements of operations and comprehensive loss based upon the classification of each employee's cash compensation.

• Mission Solutions Costs:

primarily include the cost of direct materials to build and test specific, customized satellite and payload systems components, such as the communications system, payload demands, and sensor integration, as well as internal labor for design and engineering.

These costs are incurred in support of long-term development contracts.

• Advanced Technology Programs Costs:

primarily include the cost of internal labor and external subcontract labor costs for our customer-centric software service solutions.

Operating Expenses

Our operating expenses are incurred from the following categories:

• Selling, general, and administrative expense consists of salaries and benefit costs, development costs, professional fees, and other expenses which include other personnel-related costs, stock-based compensation expenses for those employees who generally support our business and operations, and occupancy costs.

Our development costs include internal labor costs to design and plan critical real-time software and geospatial analytic solutions and solution enhancements, including mapping, analysis, site target monitoring, and news feeds.

• Research and development expense consists of employees’ salaries, taxes, and benefits costs incurred while researching next generation space and ground architectures in support of our long-term strategy.

With our acquisition of LeoStella in November 2024, research and development expense also includes our investments in satellite design and functionality.

Additionally, we employ and classify third-party vendors who fulfill our strategic projects as research and development expense.

We intend to continue to invest appropriate resources in research and development efforts, as we believe that investment is critical to maintaining our competitive position.

• Depreciation expense is related to property and equipment, which mainly consist of operational satellites.

• Selling, General, and Administrative Expense:

consists of salaries, taxes, and benefit costs, product development costs, professional fees, and other expenses which include other personnel-related costs, stock-based compensation expense for those employees who generally support our business and operations, and occupancy costs.

• Research and Development Expense:

consists of employees’ salaries, taxes, and benefits costs incurred while researching next generation space and ground architectures in support of our long-term strategy.

With our acquisition of BlackSky Satellite Systems in November 2024, research and development expense also includes our investments in satellite design and functionality.

Additionally, we employ and classify third-party vendors who help fulfill our strategic projects as research and development expense.

continue to invest appropriate resources in research and development efforts, as we believe that investment is critical to maintaining our competitive position.

• Depreciation Expense:

is related to property and equipment, which mainly consist of operational satellites and capitalized internal-use software.

Amortization expense is related to intangible assets, which mainly consist of customer relationships.

We expect to incur additional depreciation expense when each Gen-3 satellite is launched and placed into service.

Results of Operations for the Years Ended December 31, 2025 and 2024

Effective January 1, 2025, we reclassified our captions on the consolidated statements of operations and comprehensive loss to better align with our increasing portfolio of mission solutions product offerings and advanced technology program service offerings.

Revenue and costs that were previously classified as imagery & software analytical services are now classified as space-based intelligence & AI services.

Professional & engineering services are now either classified as mission solutions if they are related to our product offerings or advanced technology programs if they are related to our service offerings.

As a result, for the year ended December 31, 2024, the amounts presented have been reclassified to conform to the current year presentation.

Results of Operations for the Years Ended December 31, 2025 and 2024

The following table provides the components of results of operations for the years ended December 31, 2025 and 2024:

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

Imagery & software analytical services $ 70,062 $ 65,391 $ 4,671 7.1 %

Professional & engineering services 32,031 29,101 2,930 10.1 %

Space-based intelligence & AI services

Mission solutions

Advanced technology programs

Total revenue

Costs and expenses

Imagery & software analytical service costs, excluding depreciation and amortization 13,907 13,793 114 0.8 %

Professional & engineering service costs, excluding depreciation and amortization 13,525 19,988 (6,463) (32.3) %

Space-based intelligence & AI services costs, excluding depreciation and amortization

Mission solutions costs, excluding depreciation and amortization

Advanced technology programs costs, excluding depreciation and amortization

Selling, general and administrative

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Operating loss

(Loss) gain on derivatives (2,815) 7,679 (10,494) (136.7) %

Loss on derivatives

Income on equity method investments

Loss on debt extinguishment

Interest income

Interest expense

Other income (expense), net 3 (1,807) 1,810 100.2 %

Other income, net

Loss before income taxes

Income tax expense

Net loss $ (57,218) $ (53,859) $ (3,359) (6.2) %

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

Imagery & software analytical revenue $ 70,062 $ 65,391 $ 4,671 7.1 %

Space-based intelligence & AI services

% of total revenue

Professional & engineering services revenue 32,031 29,101 2,930 10.1 %

Mission solutions

% of total revenue

Advanced technology programs

% of total revenue

Total revenue

Imagery and Software Analytical Services Revenue

Imagery and software analytical services revenue increased for the year ended December 31, 2024 as compared to the same period in 2023, primarily driven by incremental imagery and analytics subscription orders and renewals from existing customers for additional services.

Professional and Engineering Services Revenue

Professional and engineering services revenue increased for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to new contracts with existing and new customers.

Professional and

engineering services revenue contain estimates that can result in the recognition of revenue in a current period for performance obligations which were satisfied or partially satisfied in a prior period.

The increase in revenue from the new contracts in 2024 was partially offset by a decrease in revenue from in-process contracts with less costs incurred year-over-year as they near maturity.

Space-Based Intelligence and AI Services Revenue

Space-based intelligence & AI services revenue decreased for the year ended December 31, 2025 as compared to the same period in 2024, as a result of a reduction in imagery revenue from one of our U.S.

Government contracts with the National Reconnaissance Office ("NRO").

This decrease was partially offset by new imagery and analytics subscription orders and renewals from other existing customers.

Mission Solutions Revenue

Mission solutions revenue increased for the year ended December 31, 2025 as compared to the same period in 2024, primarily from execution on a contract to deliver a customized Earth observation satellite to a new customer.

Advanced Technology Programs Revenue

Advanced technology programs revenue decreased for the year ended December 31, 2025 as compared to the same period in 2024, largely due to the completion of services performed for existing customers.

This decrease was partially offset by a new contract to provide advanced satellite control software to an existing customer.

Costs and Expenses

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

Imagery & software analytical service costs, excluding depreciation and amortization $ 13,907 $ 13,793 $ 114 0.8 %

Professional & engineering service costs, excluding depreciation and amortization 13,525 19,988 (6,463) (32.3) %

Total costs $ 27,432 $ 33,781 $ (6,349) (18.8) %

Imagery and Software Analytical Service Costs

Imagery & software analytical service costs, excluding depreciation and amortization, remained flat for the year ended December 31, 2024, as compared to the same period in 2023.

Professional and Engineering Service Costs

Professional & engineering service costs, excluding depreciation and amortization, decreased for the year ended December 31, 2024 as compared to the same period in 2023, primarily due to fewer direct material costs incurred on two long-term engineering contracts, which was driven by an increase in the program's maturity year-over-year and from contributed non-recurring costs that were incurred for programs in 2023 that did not reoccur in 2024.

Space-based intelligence & AI services costs, excluding depreciation and amortization

Mission solutions costs, excluding depreciation and amortization

Advanced technology programs costs, excluding depreciation and amortization

Space-Based Intelligence and AI Service Costs

Space-based intelligence & AI services costs, excluding depreciation and amortization, increased for the year ended December 31, 2025 as compared to the same period in 2024, due to an increase in third-party imagery fulfillment costs.

Mission Solutions Costs

Mission solutions costs, excluding depreciation and amortization, increased for the year ended December 31, 2025 as compared to the same period in 2024, primarily due to the impact of incurred work in process costs under a satellite procurement contract that began in 2025.

This increase was partially offset by fewer direct material costs incurred on several existing contracts as well as contracts completed in 2024 and 2025.

Advanced Technology Programs Costs

Advanced technology programs costs, excluding depreciation and amortization, slightly decreased for the year ended December 31, 2025 as compared to the same period in 2024, primarily due to contracts completed in 2024 and 2025.

Selling, General, and Administrative

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

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Information technology and other administrative expenses

Selling and marketing 3,783 3,789 (6) (0.2) %

Professional fees

Insurance 1,937 2,755 (818) (29.7) %

Rent expense 1,852 1,762 90 5.1 %

Development costs 954 1,037 (83) (8.0) %

Selling and marketing

Product development costs

Selling, general and administrative

Selling, general, and administrative expenses increased slightly during the year ended December 31, 2024 as compared to the same period in 2023.

Salaries and benefits costs increased primarily due to the investments in AI

capabilities that were ratably hired in 2023 in addition to the workforce acquired in our acquisition of LeoStella in the fourth quarter of 2024.

Professional fees increased as a result of increased transaction costs stemming from the business acquisition in 2024 and the increase in stock-based compensation was due to the acceleration of expense for stock options that were voluntarily forfeited during the first quarter of 2024.

These increases were partially offset by decreases in corporate insurance premiums year over year as we have been able to negotiate better rates.

The following is our forecast for total RSU expense as of December 31, 2024, which, in addition to the amounts recognized in selling, general, and administrative expenses, includes the portion that will be capitalized or classified in imagery and software analytical service costs and professional and engineering service costs:

Selling, general, and administrative expenses increased during the year ended December 31, 2025 as compared to the same period in 2024, primarily related to the inclusion of BlackSky Satellite Systems's operations for a full year in 2025 versus only two months in 2024.

Additionally, information technology and other administrative expenses increased largely due to costs associated with initiatives to optimize corporate business operational systems and maintain our offices and facilities during 2025.

Stock-based compensation expense increased as a result of an increase in the average stock price at the time of the grant of new stock awards in 2025.

Professional fees increased as a result of one-time transaction costs and accounting fees incurred during 2025 that were associated with finalizing the BlackSky Satellite Systems acquisition that closed in late 2024.

The following is our forecast for total restricted stock units ("RSUs") non-cash stock-based compensation expense as of December 31, 2025, which, in addition to the amounts recognized in selling, general, and administrative expenses, includes the portion that will be capitalized or classified in space-based intelligence & AI services, mission solutions, or advanced technology programs costs:

(in thousands)

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Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

Research and development

Research and development expense increased for the year ended December 31, 2024, as compared to the same period in 2023.

The fluctuations were driven by our increased investments in satellite design and functionality as a result of our LeoStella acquisition in November 2024 as well as the timing of contracts from third-party vendors who fulfill our strategic projects, the costs of which were included in research and development expense.

We have continued to invest in our research and development initiatives to significantly expand our product capabilities in the future.

Research and development expense decreased for the year ended December 31, 2025, as compared to the same period in 2024, due to the completion of certain development projects in late 2024 and early 2025.

Depreciation and Amortization

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

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Depreciation of all other property and equipment

Amortization 611 561 50 8.9 %

Depreciation and amortization

Depreciation expense from satellites decreased for the year ended December 31, 2024 as compared to the same period in 2023 as satellites became fully depreciated.

Depreciation expense from all other property and equipment increased for the year ended December 31, 2024 as compared to the same period in 2023, primarily driven by the depreciation of increased asset balances for internal-use software as well as the build-out of new office space in 2024.

Amortization expense remained relatively flat for the year ended December 31, 2024 as compared to the same period in 2023.

Depreciation expense from satellites decreased for the year ended December 31, 2025 as compared to the same period in 2024 because a number of Gen-2 satellites became fully depreciated in 2024.

These decreases were partially offset by the depreciation expense for our Gen-3 satellites launched in 2025.

Depreciation expense from all other property and equipment increased for the year ended December 31, 2025 as compared to the same period in 2024.

This increase was primarily driven by the depreciation of increasing asset balances for internal-use software as we continue to invest in our BlackSky Spectra software platform, features for our Gen-3 constellation, and internal infrastructure.

The increase was also related to the recognition of depreciation expense for assets recorded as part of our November 2024 acquisition of BlackSky Satellite Systems.

Amortization expense increased for the year ended December 31, 2025 as compared to the same period in 2024 as a result of intangible assets acquired by the Company in the fourth quarter of 2024.

Non-Operating Expenses

Years Ended December 31,

2024 2023 Change Change

(dollars in thousands)

(Loss) gain on derivatives $ (2,815) $ 7,679 $ (10,494) (136.7) %

Loss on derivatives

Income on equity method investments

Loss on debt extinguishment

Interest income

Interest expense

Other income (expense), net 3 (1,807) 1,810 100.2 %

(Loss) gain on derivatives

Fluctuations in our equity warrants and other equity instruments that we classify as derivative liabilities in the consolidated balance sheets and measure at fair value are significantly driven by our common stock price.

Other income, net

Loss on derivatives

Our common stock price significantly drives fluctuations in our equity warrants and other equity instruments that we classify as derivative liabilities in our consolidated balance sheets and measure at fair value.

Fluctuations to these instruments are inversely related to changes in our common stock price, the volatility of the markets, and the duration of the equity warrants.

The gains or losses recognized in the period are non-cash fair value adjustments.

These instruments generated a loss during the year ended December 31, 2024 versus a gain during the year ended December 31, 2023.

We re-measure our outstanding derivative liabilities to fair value at each reporting date.

In July 2025, holders exercised 611 thousand of our March 2023 Private Placement Warrants and the exercised warrants were re-measured to fair value on their exercise dates.

Any gains or losses recorded upon re-measurement in the applicable period are non-cash fair value adjustments.

These re-measurements of derivative liabilities generated a net loss during each of the years ended December 31, 2025 and 2024.

Income on equity method investments

The fluctuations in income on equity method investments were due to a gain of $9.5 million from the sale of our investment in X-Bow in 2023, which was partially offset by the 2023 operating results of our former joint venture LeoStella.

We did not recognize any percentage of LeoStella's estimated net loss during the year ended December 31, 2024 since our investment in LeoStella was $0 as of December 31, 2023.

In November 2024, when we acquired the remaining common units of LeoStella, LeoStella became a wholly-owned subsidiary of BlackSky Holdings, Inc.

and their results of operations were included in our consolidated financial statements after the date of acquisition.

In conjunction with the business combination, the Company recognized a gain of $0.9 million related to the step up acquisition.

In November 2024, we acquired the remaining 50% of the common units of BlackSky Satellite Systems, f/k/a LeoStella, which is now a wholly-owned subsidiary of the Company.

As of the date of acquisition, BlackSky Satellite Systems's results of operations are now included in our consolidated financial statements.

In conjunction with this business combination, we recognized a gain of $0.9 million related to the step up acquisition during the year ended December 31, 2024.

Loss on debt extinguishment

The loss on debt extinguishment incurred during the year ended December 31, 2025 was due to prepayment fees and third-party costs from the early repayment of the related party loans and commercial bank line in July 2025.

Interest income

Interest income decreased during the year ended December 31, 2024 as a result of lower cash balances during the period as compared to the same period in 2023.

Interest income increased during the year ended December 31, 2025 as a result of higher short-term investment balances during the period as compared to the same period in 2024.

Interest expense

Interest expense increased during the year ended December 31, 2024, as compared to the year ended December 31, 2023, as a result of increased debt outstanding during the year ended December 31, 2024, as compared to the same period in 2023, and a higher effective interest rate on our loans from related parties that were amended during the second quarter of 2023.

Other income (expense), net

For the year ended December 31, 2024 as compared to the year ended December 31, 2023, other income (expense), net changed related to $0.9 million of one-time only transaction costs associated with the issuance of new warrants in 2023 that are accounted for as derivative liabilities and $0.8 million of one-time only transaction costs associated with our debt modification during 2023.

Interest expense increased during the year ended December 31, 2025, as compared to the same period in 2024 because our outstanding debt increased from $109.0 million as of December 31, 2024 to $207.9 million as of December 31, 2025.

In July 2025, we decreased the average interest rate of our outstanding debt when we repaid $100.2 million of loans from related parties in their entirety, which had a stated interest rate of 12% upon repayment, and issued $185.0 million of Convertible Senior Notes with a stated interest rate of 8.25%.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, management utilizes certain non-GAAP performance measures, such as Adjusted EBITDA, for purposes of evaluating our ongoing operations and for internal planning and forecasting purposes.

Our management and board of directors believe that this non-GAAP operating measure, when reviewed with our GAAP financial information, provides useful supplemental information to investors in assessing our operating performance.

Our management and board of directors believe that this non-GAAP

operating measure, when reviewed with our GAAP financial information, provides useful supplemental information to investors in assessing our operating performance.

Adjusted EBITDA

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unrealized (gain) loss on certain warrants/shares classified as derivative liabilities;

loss on debt extinguishment;

non-recurring transaction costs;

litigation, settlements, and related costs;

impairment losses;

income on equity method investment;

transaction costs associated with debt and equity financings;

and investment loss on short-term investments.

and impairment, obsolescence, and asset disposals.

We have presented Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital.

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The table below reconciles our net loss to Adjusted EBITDA for the years ended December 31, 2025 and 2024.

As noted above, on November 6, 2024, we acquired the remaining 50% of the common units of BlackSky Satellite Systems, f/k/a LeoStella, which is now a wholly-owned subsidiary of BlackSky.

In conjunction with the business combination, the Company recognized a gain of $0.9 million related to the step up acquisition during the year ended December 31, 2024.

Other than the gain related to the step up acquisition, we did not record any percentage of BlackSky Satellite Systems's estimated net loss during the year ended December 31, 2024 since our investment in

LeoStella was $0 as of December 31, 2023.

After the acquisition in 2024, BlackSky Satellite Systems's financial results are fully consolidated in our consolidated financial statements.

Years Ended December 31,

(in thousands)

Net loss $ (57,218) $ (53,859)

Interest income

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Stock-based compensation expense

Loss (gain) on derivatives 2,815 (7,679)

Loss on derivatives

Loss on debt extinguishment

Non-recurring transaction costs

Litigation, settlements, and related costs

Severance 219 590

Impairment losses 131 81

Impairment, obsolescence, and asset disposals

Income on equity method investment

Transaction costs associated with debt and equity financings — 1,738

Investment loss on short-term investments — 55

Adjusted EBITDA

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Our short-term liquidity as of December 31, 2025 was $125.6 million.

We expect cash and cash equivalents and cash generated from operating activities to be sufficient to meet our working capital and capital expenditure needs for the foreseeable future.

Our future long-term capital requirements will depend on many factors including our Gen-3 satellite production needs, manufacturing costs, launch costs and increased insurance costs, as well as our growth rate, customer demand for capacity, the timing and extent of spending to support solution development efforts, the expansion of sales and marketing activities, the ongoing investments in technology infrastructure, the introduction of new and enhanced solutions, and the continuing market acceptance of our solutions.

Our equity issuances during the year ended December 31, 2024 included a public offering of shares as well as an at-the-market (“ATM”) offering.

In September 2024, we completed a public offering comprised of 11.5 million shares of common stock for a public offering price of $4.00 per share.

We received $46.0 million in gross proceeds

from this public offering.

We also have the ability to offer and sell from time to time up to $75.0 million of newly issued shares in open trading windows at market prices through a designated broker dealer pursuant to an ATM offering program, of which we sold $4.8 million during the year ended December 31, 2024.

We have current contract assets of $27.9 million and we anticipate receiving this amount in payments over the next 12 months as interim milestones on a few major customer contracts are met and expected to be billed, further enhancing our liquidity.

In April 2024, we entered into a commercial bank line with Stifel Bank, as lender.

The commercial bank line provides for a $20.0 million revolving credit facility, including a $0.5 million sub-facility for the issuance of letters of credit and other ancillary banking services.

The commercial bank line matures on June 30, 2026.

As of December 31, 2024, we had borrowed $10.0 million in revolving loans.

We may increase or decrease our borrowings at our discretion with no penalty.

The commercial bank line accrues interest at a rate equal to the greater of (A) the prime rate or (B) 6%.

Interest on the loan is payable quarterly in arrears.

We are required to pay an unused line fee of 0.25% per annum, payable quarterly in arrears.

We may borrow, prepay, and re-borrow revolving loans, without premium or penalty.

The principal amount of outstanding loans, together with accrued and unpaid interest, is due on the loan maturity date.

We are also obligated to pay a fee to the lender upon the occurrence of certain change of control events or the refinancing, repayment, or termination of the commercial bank line, along with other customary fees for a loan facility of this size and type.

The commercial bank line contains customary affirmative and negative covenants, including covenants limiting our ability to, among other things, incur debt, grant liens, pay dividends and distributions on our capital stock, make investments and acquisitions, and make capital expenditures, in each case subject to customary exceptions for a loan facility of this size and type.

As part of the commercial bank line, we are required to maintain the following financial covenants:

• $10.0 million of minimum cash and cash equivalents balance, measured quarterly as of the last day of each fiscal quarter.

• Adjusted EBITDA, measured quarterly as of the last day of each fiscal quarter, of not less than:

• $5.0 million for the trailing four quarter period ending as of December 31, 2024 through September 30, 2025 and

• $10.0 million for the trailing four quarter period ending as of December 31, 2025 and as of the end of each fiscal quarter thereafter.

• Quarterly minimum revenue targets agreed upon by us and the bank at the beginning of each year.

• Unrestricted and unencumbered cash and cash equivalents in an amount equal to at least one hundred percent of the outstanding debt at all times.

If we fail to meet the minimum cash covenant, the commercial bank line provides us with the ability to cure the breach with the deposit of proceeds from the issuance of capital stock or subordinated debt.

The commercial bank line includes customary events of default, including payment defaults, covenant breach defaults, cross defaults with certain other material indebtedness, bankruptcy and insolvency defaults, and a material adverse effect default, as well as an event of default for certain impairments of the availability of our ATM facility.

The occurrence of an event of default could result in the acceleration of our obligations under the commercial bank line, the termination of Stifel Bank’s commitments, a 5% increase in the applicable rate of interest, and the exercise by Stifel Bank of other rights and remedies provided for under the commercial bank line.

We were in compliance with all covenants as of December 31, 2024 and expect to remain in compliance with all covenants in the next 12 months from the issuance of the financial statements.

We entered into a vendor financing agreement for multiple satellite launches providing for $27.0 million, of which a portion will be drawn down equally per satellite launch and will be repaid quarterly on a pro-rata basis across a three-year period after each successful launch milestone.

Payments will accrue interest at 12.6% per annum, beginning on each launch date.

As of December 31, 2024, we estimate we will repay approximately $2.0 million of

short-term debt related to the vendor financing agreement in the next 12 months.

We may prepay at any time until the maturity date without premium or penalty.

See Note 14—“Debt and Other Financing” of the notes to the consolidated financial statements for further information on our debt and financing arrangements and Note 23 - “Commitments and Contingencies” of the notes to the consolidated financial statements for further information on our contractual obligations.

We expect cash and cash equivalents, short-term investments, and cash generated from operating activities to be sufficient to meet our working capital and capital expenditure needs for the foreseeable future.

Our future long-term capital requirements will depend on many factors, including our Gen-3 satellite and mission solutions production needs, launch and insurance costs, our growth rate, customer demand for capacity, the timing and extent of spending to support solution development efforts, our ongoing investments in technology infrastructure, and the continuing market acceptance of our products and services.

Convertible Senior Notes

In July 2025, we issued $185.0 million aggregate principal amount of Convertible Senior Notes in a private offering.

The Convertible Senior Notes will mature on August 1, 2033 unless earlier converted, redeemed or

The Convertible Senior Notes will bear interest at a rate of 8.25% per year, payable semiannually in arrears on February 1 and August 1 of each year, beginning on February 1, 2026.

Holders may convert their Convertible Senior Notes at their option at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date.

Upon conversion, we will pay or deliver, as the case may be, shares of our Class A common stock, cash, or a combination of cash and shares of our Class A common stock, at our election.

The conversion rate of the Convertible Senior Notes will initially be 27.1909 shares of BlackSky’s Class A common stock per $1,000 principal amount of Convertible Senior Notes (equivalent to an initial conversion price of approximately $36.78 per share of Class A common stock).

We may not redeem the Convertible Senior Notes prior to August 4, 2028.

We may redeem for cash all or any portion of the Convertible Senior Notes, at our option, on or after August 4, 2028 and prior to the 26th scheduled trading day immediately preceding the maturity date, if (1) the last reported sale price of our Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption and (2) certain liquidity conditions are satisfied, at a redemption price equal to 100% of the principal amount of the Convertible Senior Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.

Satellite Launch Vendor Financing

We have also entered into two vendor financing agreements to fund the costs of multiple satellite launches.

Our November 2023 agreement provides for a $27.0 million borrowing commitment and payments accrue interest at 12.6% per annum while our November 2025 agreement is for a $30.6 million borrowing commitment and payments accrue interest at 9.50% per annum.

A portion of the vendor financing agreements can be drawn down equally per satellite launch and will be repaid quarterly on a pro-rata basis across a three-year period after each successful launch milestone.

Interest begins to accrue on each launch date.

We may prepay either agreement at any time until the maturity date without premium or penalty.

The outstanding debt related to the vendor financing agreements is guaranteed by the Company’s subsidiaries and secured by substantially all of the assets of the Company and its subsidiaries.

During the year ended December 31, 2025, we incurred $19.7 million of additional debt related to the satellite launch vendor financing agreements.

As of December 31, 2025, we have $31.9 million of additional vendor financing available to us for future launches.

At-the-Market ("ATM") Transactions

During the year ended December 31, 2025, we issued and sold shares of our Class A common stock under our ATM sales agreement, dated December 15, 2022, with Jefferies LLC as our sales agent (the “2022 ATM Agreement”), resulting in gross proceeds of $42.5 million.

We had the ability to offer and sell up to $75.0 million of newly issued shares of our Class A common stock in open trading windows at market prices through a designated broker dealer pursuant to an ATM offering program.

We terminated the 2022 ATM Agreement in November 2025.

On December 12, 2025, we entered into an ATM sales agreement with Deutsche Bank Securities Inc.

and Craig-Hallum Capital Group LLC as our sales agents (the “2025 ATM Agreement”), under which we may offer and sell from time to time up to $100.0 million of shares of our Class A common stock in negotiated transactions or transactions that are deemed to be an ATM offering.

During the year ended December 31, 2025, we did not sell any shares of our Class A common stock under the 2025 ATM Agreement.

Current Contract Assets

We had $28.6 million and $27.9 million of current contract assets as of December 31, 2025 and 2024, respectively.

We expect to continue billing for and receiving payments on our contract assets over the next 12 months as interim milestones on a few major customer contracts are met.

The timing of customer billing and payment varies from contract to contract and we may continue to generate additional contract assets in 2026 and beyond as we enter into new contracts.

From time to time, we may seek additional equity or debt financing to fund capital expenditures, strategic initiatives or investments and our ongoing operations.

If we decide, or are required, to seek additional financing from outside sources, we may not be able to raise it on terms acceptable to us or at all.

If we are unable to raise additional capital when desired, our business, financial condition and results of operations could be adversely affected.

If we are unable to raise

additional capital when desired, our business, financial condition and results of operations could be adversely affected.

Funding Requirements

We continue to generate positive Adjusted EBITDA;

however, we cannot be sure our revenues will continue to exceed expenses in the near term due to the ongoing investments we are making in sales, marketing and products to increase our market share.

We expect to continue to incur capital expenditures as we procure and launch Gen-3 satellites, as well as invest in our BlackSky Spectra software platform to significantly expand our product capabilities in the future.

Please refer to the section entitled “Non-GAAP Financial Measures” for additional information on our definition of Adjusted EBITDA.

We cannot be sure our revenues will exceed expenses in the near term due to the ongoing investments we are making in sales, marketing and products to increase our market share.

We expect to continue to incur capital expenditures as we procure, build, and launch Gen-3 satellites, as well as invest in our BlackSky Spectra software platform to significantly expand our product capabilities in the future.

Short-Term Liquidity Requirements

As of December 31, 2024, our current assets were $106.7 million, consisting primarily of short-term investments, contract assets, accounts receivable, and cash and cash equivalents.

As of December 31, 2024, our current liabilities were $26.0 million, consisting primarily of accounts payable and accrued liabilities.

As of December 31, 2025, our current assets were $206.8 million, consisting primarily of short-term investments, cash and cash equivalents, accounts receivable, and contract assets.

As of December 31, 2025, our current liabilities were $59.5 million, consisting primarily of contract liabilities, other current liabilities, which includes a $7.6 million contingent liability expected to be offset by an insurance recovery of $7.4 million, and accounts payable and accrued liabilities.

Accordingly, we have sufficient cash and working capital to fund our short-term liquidity requirements.

Long-Term Liquidity Requirements

We anticipate that our most significant long-term liquidity and capital needs will relate to continued funding of operations, satellite development capital expenditures, launch capital expenditures, and ongoing investments in our BlackSky Spectra software platform and internal infrastructure that will enable us to continue to scale the business efficiently and securely.

We anticipate that our most significant long-term liquidity and capital needs will relate to continued funding of operations, including procurement of materials for our missions solutions programs, satellite development capital expenditures, launch capital expenditures, and ongoing investments to optimize our BlackSky Spectra software platform and corporate business and operational systems that will enable us to continue to scale the business efficiently and securely.

These ongoing investments in our operational systems include a multi-year minimum commitment for compute/storage costs to facilitate our expanding AI/ML functionality.

Upcoming satellite development capital expenditures include plans to expand our current high frequency monitoring constellation with multispectral, large-area collection satellites.

We expect that these new satellites will be designed to support country scale digital mapping, navigation, maritime, and 3D digital twin applications.

We can manage the timing for a large part of our capital expenditures, including the design, build, and launch of our new satellites currently under development, to provide us with additional flexibility to optimize our long-term liquidity requirements.

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Years Ended December 31,

2024 2023 Change

(in thousands)

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Net cash provided by financing activities

Net decrease in cash, cash equivalents, and restricted cash (19,056) (3,582) (15,474)

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

Cash, cash equivalents, and restricted cash – beginning of year

Cash, cash equivalents, and restricted cash – end of period

$ 14,378 $ 33,434 $ (19,056)

Operating Activities

For the year ended December 31, 2024, net cash used in operating activities was $6.4 million.

The contributor to the significant decrease in cash used during the year ended December 31, 2024 as compared to the year ended December 31, 2023 was the decrease in the operating loss, adjusted for non-cash items, as well as a decrease in the net cash used for working capital.

The operating loss decrease in the year ended December 31, 2024 as compared to the year ended December 31, 2023 was due to increased imagery revenue primarily driven by incremental imagery and analytics subscription orders and renewals from existing customers for additional services.

The decrease in cash used for working capital was largely related to the fact that our contract assets increased at a lower rate in 2024 than they did in 2023.

For the year ended December 31, 2025, net cash used in operating activities was $28.3 million, which is an increase compared to the same period in 2024.

The increase reflected in the year ended December 31, 2025 includes $29.1 million of paid in kind interest associated with our related party debt that we repaid utilizing the proceeds from our Convertible Senior Notes issued in July 2025.

See "Financing activities" below for further detail on the remainder of the cash inflows and outflows related to our debt transactions during the year ended December 31, 2025.

Additionally, the increase in net cash used in operating activities reflected a larger accounts receivable balance in our consolidated balance sheet as of December 31, 2025.

We subsequently reduced our accounts receivable balance when we collected on a significant invoice in January 2026.

The increase in net cash used in operating activities also includes an increase in our operating loss, adjusted for depreciation, amortization, stock-based compensation expense, loss on derivatives, and other non-cash items inclusive of our BlackSky Satellite Systems operations.

Prior to the acquisition of the remaining 50% of the common units of BlackSky Satellite Systems in November 2024, our consolidated statements of cash flows included the income on equity method investment as a non-cash adjustment to reconcile net loss to net cash used in operating activities.

Subsequent to the acquisition, we fully consolidated BlackSky Satellite Systems's financial results in our consolidated financial statements and BlackSky Satellite Systems's cash inflows and outflows are primarily included within our operating activities.

The increases in net cash used in operating activities were partially offset by a cash receipt for prepaid capacity for future purchase orders that is recorded as a contract liability as of December 31, 2025 in our consolidated balance sheets.

Investing Activities

The change in net cash used in investing activities was primarily due to decreased proceeds from the redemption and maturity of $34.2 million of our short-term investments in corporate debt and governmental securities in addition to decreased purchases of these same type of investments of $52.9 million during the year ended December 31, 2024.

Comparatively, during the year ended December 31, 2023, we recognized $59.1 million related to the redemption and maturity of short-term investments, largely due to restructuring our banking relationships with new and existing financial institutions;

during the year ended December 31, 2023, we purchased $40.1 million of short-term investments to replace maturing investments.

Additionally, we received proceeds of $9.5 million from the sale of our investment in X-Bow in 2023.

We continue to have significant cash outflows for satellite procurement and launch related services and incur labor costs for internally developed capitalized software as we add innovative new services and tools to our BlackSky Spectra software platform.

The total amount paid for capital expenditures increased during the year ended December 31, 2024 as compared to the year ended December 31, 2023 as we continued to build and prepare for the launch of our Gen-3 satellites.

The change in net cash used in investing activities was primarily due to increased purchases of short-term investments in government securities of $127.8 million during the year ended December 31, 2025 compared to $52.9 million of purchases during the year ended December 31, 2024.

We continue to have significant cash outflows for satellite procurement and launch-related services.

We also incur labor costs for internally developed capitalized software as we add innovative new services and tools to our BlackSky Spectra software platform and our corporate business and operational systems.

For most of 2024, we paid BlackSky Satellite Systems, f/k/a LeoStella, as a third-party and classified such payments as cash outflows for investing activities.

Following the acquisition of BlackSky Satellite Systems, we have classified their internal operations costs in our consolidated results.

As a result, the total amount paid for capital expenditures decreased during the year ended December 31, 2025 as compared to the year ended December 31, 2024.

We expect cash outflows for satellite production to increase as we continue to build out our satellite constellation.

Financing Activities

The most significant impact on the change in net cash provided by financing activities was the receipt of $47.0 million in proceeds from our equity issuances, net of equity issuance costs, in the year ended December 31, 2024 as compared to $32.7 million in the year ended December 31, 2023.

Our equity issuances during the year ended December 31, 2024 included a public offering of 11.5 million shares of common stock resulting in $46.0 million in gross proceeds as well as the sale of 0.5 million shares under our ATM offering program which

resulted in $4.8 million in gross proceeds.

Our equity issuances in the year ended December 31, 2023 included a private placement of 2.1 million shares, which resulted in $29.4 million in gross proceeds, as well as the sale of 0.4 million shares under our ATM offering program, which resulted in $5.0 million in gross proceeds.

In addition, we also had borrowings from our revolving credit facility of $20.0 million during the year ended December 31, 2024, which were partially offset by $10.0 million of payments towards the same revolving credit facility.

The most significant impact on the change in net cash provided by financing activities during the year ended December 31, 2025 as compared to the year ended December 31, 2024 was the receipt of $185.0 million in proceeds from the issuance of our Convertible Senior Notes in July 2025, which was partially offset by debt repayments of $110.3 million and $7.3 million of debt issuance costs.

The debt repayments included $81.2 million of principal and accrued interest as well as paid in kind interest of $29.1 million, which is included in net cash used in operating activities.

Additionally, we received $40.8 million in net proceeds from our equity issuances during the year ended December 31, 2025 as compared to $47.0 million in net proceeds during the year ended December 31, 2024.

Our equity issuances during the year ended December 31, 2025 consisted of the sale of 3.7 million shares of our Class A common stock under the 2022 ATM Agreement, which resulted in $42.5 million in gross proceeds.

In comparison, for the year ended December 31, 2024, we sold 0.5 million shares of our Class A common stock under our 2022 ATM Agreement, which resulted in $4.8 million in gross proceeds.

Our equity issuances during the year ended December 31, 2024 also included a public offering of 11.5 million shares of Class A common stock resulting in

$46.0 million in gross proceeds.

Finally, in 2025, we received $10.8 million of proceeds from warrant exercises of 611 thousand of the March 2023 Private Placement Warrants during the year ended December 31, 2025.

Contractual Obligations and Commitments

As of December 31, 2024, we had a debt facility from related parties with an outstanding principal amount of $93.0 million, which matures in October 2026, and interest due to related parties of $1.9 million, of which $0.4 million was included in other current liabilities and $1.5 million was included in other liabilities.

See Note 14—“Debt and Other Financing” and Note 21 - “Related Party Transactions” of the notes to the consolidated financial statements for further information on this facility.

In November 2023, we entered into a commercial agreement with financing terms for multiple satellite launches providing for $27.0 million, of which a portion can be drawn down equally per satellite launch and will be repaid quarterly on a pro-rata basis across a three-year period after each successful launch milestone.

Payments will accrue interest at 12.6% per annum, beginning on each launch date.

During the year ended December 31, 2025, we entered into a commitment for non-refundable multi-launch and integration services.

We also entered into a commercial borrowing agreement with financing terms for multiple launches providing for $3.4 million to be paid upfront, and for $30.6 million, of which a portion will be drawn down equally per launch and will be repaid quarterly on a pro-rata basis across a three-year period after each successful launch milestone.

Payments will accrue interest at 9.5% per annum.

We may prepay at any time until the maturity date without premium or penalty.

During the year ended December 31, 2024, we incurred $6.0 million of debt related to this financing agreement.

We also entered into a non-refundable commitment during the year ended December 31, 2024 for launch insurance, which will cover the risk of total or partial loss for multiple satellite launches.

The minimum commitment associated with the launch insurance is $6.0 million.

As of December 31, 2025, the minimum commitment associated with the multi-launch and integration services agreements was $8.0 million.

Under certain circumstances, a default interest rate will apply on all outstanding and payable obligations during the existence of an event of default under the Loan Agreement at 18.9% per annum above the applicable interest rate.

In addition to the above, we entered into various operational commitments for the next several years totaling $30.1 million as of December 31, 2025.

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Specifically, judgment is used in interpreting complex arrangements with nonstandard terms and conditions and determining when all criteria for revenue recognition have been met, as further discussed below.

We generate revenue from the sale of imagery, data, software, and analytics, as well as professional and engineering services.

We generate revenue from the sale of space-based intelligence & AI services, mission solutions, and advanced technology programs.

Identifying the Contract with the Customer

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We have never had significant collection issues on contracts with new or recurring domestic and international government customers and we consider this historical trend when assessing the collectability risk for contracts with bespoke effective terms.

We also consider the probability of the customer funding the total contract value as a component of the collectability risk.

Identifying the Performance Obligations in a Contract

We execute contracts for a single promise or multiple promises.

Specifically, our firm-fixed price contracts may include multiple promises which may be accounted for as separate performance obligations if they are capable of being distinct and distinct within the context of the contract.

Significant judgment is required in determining performance obligations, including if some of the customized services are highly-interrelated, and these decisions could change the amount of revenue and profit or loss recorded in each period.

Specifically, our firm-fixed price contracts may include multiple promises which may be accounted for as separate performance obligations if they are capable of

being distinct within the context of the contract.

Significant judgment is required in determining performance obligations and these decisions could change the amount of revenue and profit or loss recorded in each period.

Classification of Revenue

We classify revenue as imagery and software analytical services, and professional and engineering services in our consolidated statements of operations and comprehensive loss based on the predominant attributes of the performance obligations.

We classify revenue as space-based intelligence & AI services, mission solutions, and advanced technology programs in our consolidated statements of operations and comprehensive loss based on the predominant attributes of the performance obligations.

Determination of and Allocation of Transaction Price

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We estimate any variable consideration, and whether the transaction price is constrained, upon execution of each contract.

We may adjust the transaction price over time for any estimated constraints that become probable based on service level provisions within some of our customer purchase orders.

Variable consideration is estimated as the most likely amount that is dependent upon the occurrence or non-occurrence of a future event.

We continually review, and may reassess, the transaction price based on forecasted service level provisions within a limited number of our customer purchase orders, costs incurred to date and historical experience.

As a result, we may update our estimated constraints on revenue, which are generally on a prospective basis.

For contracts with multiple performance obligations, we evaluate whether the stated selling prices for the products or services represent their standalone selling prices.

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Determination of when Performance Obligations are Satisfied

Imagery and analytics revenue is recognized ratably over the subscription period based on the promise to continuously provide contractual satellite capacity for tasked imagery or software analytical services at the discretion of the customer.

Professional and engineering services revenue is generated from time and materials basis contracts, cost-plus contracts, firm-fixed price service solutions contracts and firm-fixed price long-term engineering and construction contracts.

Due to the long-term nature of some of our engineering and construction contracts, we recognize revenue over time using a cost-to-complete measure of progress because it best depicts the transfer of control to the customer as we incur costs on the contracts.

Space-based intelligence & AI services revenue is recognized over the subscription period based on the promise to continuously provide contractual satellite capacity for tasked imagery or software analytical services at the discretion of the customer.

Mission solutions revenue is primarily recognized from firm-fixed price long-term customized satellites and ground station contracts.

Advanced technology programs revenue is primarily generated from cost-plus contracts, and time and materials basis contracts and firm-fixed price service solutions contracts.

Due to the long-term nature of some of our contracts, we recognize revenue over time using a cost-to-complete measure of progress because it best depicts the transfer of control to the customer as we incur costs on the contracts.

Under this measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the performance obligation(s).

The estimation of total estimated costs at completion is subject to many variables and requires significant judgment.

Calculating total estimated costs at completion is subject to many variables and requires significant judgment.

We recognize changes in the estimation of total costs at completion on a cumulative catch-up basis in the period in which the changes are identified.

Such changes in estimates can result in the recognition of revenue in a current period for performance obligations which were satisfied or partially satisfied in a prior period.

Such changes in estimates can result in the recognition of revenue in a current period for performance obligations that were satisfied or partially satisfied in a prior period.

If, at any time, the estimate of contract profitability indicates a probable anticipated loss on the contract, we recognize the total loss as and when known.

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We have equity and equity-based awards outstanding under our 2021 Equity Incentive Plan ("2021 Plan") and our 2014 Equity Incentive Plan ("2014 Plan").

Outstanding awards issued include stock options and restricted stock units ("RSUs").

In addition, our eligible employees are able to participate in our 2021 Employee Stock Purchase Plan ("ESPP") pursuant to purchase right offerings that are established under the ESPP.

For purposes of recognizing equity-based compensation related to RSUs and stock options granted to employees and other service providers, management estimates the grant date fair values of such awards to measure the costs to be recognized as services are received.

Outstanding awards issued include stock options and RSUs.

In addition, our eligible employees can participate in our 2021 Employee Stock Purchase Plan ("ESPP") pursuant to purchase right offerings that are established under the ESPP.

the costs to be recognized as services are received.

For awards with time-based vesting conditions, we recognize compensation costs based upon the straight-line amortization of the grant date fair value of the awards over the requisite service period.

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If any of these assumptions were to change significantly in the future, equity-based compensation related to future awards may differ significantly, as compared with awards previously granted.

We have largely moved towards granting RSUs to the bulk of our employees, for which the grant date fair value is equal to the trading price fair value of our Class A common stock on the date of grant.

We grant RSUs to the bulk of our employees.

For these RSUs, the grant date fair value is equal to the trading price fair value of our Class A common stock on the date of grant.

For stock options, which are primarily granted to certain management employees, we use the following inputs under Black-Scholes as follows:

Expected Dividend Yield—The Black-Scholes valuation model requires an expected dividend yield as an input.

Expected Dividend Yield:

The Black-Scholes valuation model requires an expected dividend yield as an input.

The dividend yield is based on historical experience and expected future changes.

We historically have not paid, and currently have no plans to pay dividends on our Class A common stock and, accordingly, have assumed no dividend yield upon valuation of our stock options.

Expected Volatility—As there was no observable volatility with respect to Legacy BlackSky Class A common stock and due to the lack of sufficient history of BlackSky Class A common stock, the expected volatility of Legacy BlackSky and BlackSky Class A common stock was estimated based upon the historical share price volatility of guideline comparable companies.

Risk-free Interest Rate—The yield on actively traded, non-inflation indexed U.S.

Treasury notes was used to extrapolate an average risk-free interest rate based on the expected term of the underlying grants.

Expected Term—For options granted since 2021, as there is not a significant history of option exercises as a public company, we consider the option vesting terms and contractual period, as well as the demographics of the holders, in estimating the expected term.

For options granted prior to 2021 when we were a private company, the expected term was the estimated duration to a liquidation event based on a weighted average consideration of the most likely exit prospects for that stage of development.

We will continue to review our estimate in the future and adjust it, if necessary, due to changes in our historical exercises.

We historically have not paid, and currently have no plans to pay dividends on our Class A common stock.

Accordingly, we have assumed no dividend yield upon valuation of our stock options.

Expected Volatility:

As there was no observable volatility with respect to Legacy BlackSky Class A common stock and due to the lack of sufficient history of BlackSky Class A common stock, we estimated the expected volatility of Legacy BlackSky and BlackSky Class A common stock based upon the historical share price volatility of guideline comparable companies.

Risk-free Interest Rate:

We used the yield on actively traded, non-inflation indexed U.S.

Treasury notes to extrapolate an average risk-free interest rate based on the expected term of the underlying grants.

Expected Term:

For options granted since 2021, as there is not a significant history of option exercises as a public company, we consider the option vesting terms and contractual period, as well as the demographics of the holders, in estimating the expected term.

We will continue to review our estimate and adjust it, if necessary, due to changes in our historical exercises.

Private Placement Warrants and Sponsor Shares

We have classified the Private Placement Warrants issued in October 2019 and March 2023 and the Osprey pre-merger Class B common shares that were exchanged for shares of our Class A common stock (the "Sponsor Shares") as long-term liabilities in our consolidated balance sheets as of December 31, 2025 and 2024.

The Private Placement Warrants issued in October 2019 and the Sponsor Shares were initially recorded at fair value on the date of the merger and the Private Placement Warrants issued in March 2023 were recorded at fair value on the date of

Although some of the warrants have expiration dates within one year of December 31, 2025, current liabilities are used principally to designate obligations whose liquidation is reasonably expected to require the use of existing resources properly classifiable as current assets, or the creation of other current liabilities.

The Private Placement Warrants issued in October 2019 and the Sponsor Shares were initially recorded at fair value on the date of the Merger, whereas the Private Placement Warrants issued in March 2023 were recorded at fair value on the date of issuance.

The Private Placement Warrants were recorded at fair value using a Black-Scholes option pricing model and the Sponsor Shares were recorded at fair value using a Monte Carlo simulation model.

These liabilities are re-measured to fair value at each subsequent reporting date and recorded to (loss) gain on derivatives in our consolidated statements of operations and comprehensive loss.

These liabilities are re-measured to fair value at each subsequent reporting date and immediately prior to each warrant exercise date.

The remeasurements are recorded to loss on derivatives in our consolidated statements of operations and comprehensive loss.

We will continue to adjust the liability for changes in fair value until the financial instruments are exercised, redeemed, cancelled or released.

The fair value models require inputs including, but not limited to, the fair value of our Class A common stock, the risk-free interest rate, expected term, expected dividend yield and expected volatility.

The fair value of our Class A common stock is the closing stock price on the NYSE as of the measurement date.

The fair value of our Class

A common stock is the closing stock price on the NYSE as of the measurement date.

The risk-free interest rate assumption is determined by using U.S.

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The dividend yield assumption is based on the dividends expected to be paid over the expected life of the financial instruments.

We have historically been a private company and lacked sufficient company-specific historical and implied volatility information.

Therefore, the expected stock volatility includes both our Class A common stock and public warrant historical volatility as well as the historical volatility of a set of publicly traded peer companies.

Expected stock volatility is based on our public warrant historical volatility.

Changes in these assumptions can materially affect the estimate of the fair value of these instruments and ultimately the change in fair value.

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Goodwill is tested annually for impairment as of October 1st, or more frequently if events or circumstances indicate the carrying value may be impaired.

A significant amount of judgement is involved in determining if an indicator of impairment has occurred.

Such indicators may include (a) a significant decline in our common stock value;

(b) a significant decline in our expected future cash flows;

(d) unanticipated competition;

or (e) slower growth rates.

We identify potential impairment by comparing the fair value of each of our reporting units with its carrying amount, including goodwill.

A significant amount of judgment is involved in determining if an indicator of impairment has occurred.

Indicators of impairment may include (a) a significant decline in our common stock value, (b) a significant decline in our expected future cash flows, (c) a significant adverse change in legal factors or the business climate, (d) unanticipated competition, or (e) slower growth rates.

We measure potential impairment by comparing the fair value of each of our reporting units with its carrying amount, including goodwill.

If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

We performed an annual qualitative goodwill assessment over the balance of goodwill we held related to the BlackSky reporting unit as of October 1, 2024.

We also determined that no triggering events occurred during the year ended December 31, 2024 that would require a quantitative assessment.

We determined that it is more likely than not that the fair value of the BlackSky reporting unit sufficiently exceeds its carrying value, including goodwill.

Although we have a history of recurring losses from operations, negative cash flows from operations, and a significant accumulated deficit, as of the October 1, 2024 analysis, the fair value was greater than 31% in excess of the carrying value for BlackSky.

As of December 31, 2024, we believe that the estimated fair values of the BlackSky reporting unit is still in excess of its respective carrying value and therefore is not at-risk of being impaired.

We performed an annual qualitative goodwill assessment related to the BlackSky reporting unit as of October 1, 2025.

We determined that no triggering events occurred during the year ended December 31, 2025 that would require a quantitative assessment.

During our qualitative assessment, we determined that it is more likely than not that the fair value of the BlackSky reporting unit sufficiently exceeds its carrying value, including goodwill.

As of December 31, 2025, we believe that the estimated fair value of the BlackSky reporting unit is still in excess of its respective carrying value and we did not identify any triggering events that indicate a risk of impairment.

Long-Lived Asset Impairment

We evaluate long-lived assets, including intangible assets, property and equipment, satellite work in process and other long-term assets, for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable.

Significant judgments in this area involve determining whether a triggering event has occurred and determining the future cash flows for assets involved.

In conducting this analysis, we compare the undiscounted cash flows expected to be generated from the long-lived assets (or asset group) to the related net book values.

Significant judgments in this area involve determining whether a triggering event has occurred and determining the future cash flows for the relevant assets.

A triggering event for assessing impairment can be a change in the estimated useful life of an intangible asset.

Once a triggering event is identified and we conduct an analysis for impairment, we compare the undiscounted cash flows expected to be generated from the long-lived assets (or asset group) to the related net book values.

If the undiscounted cash flows exceed the net book value, the long-lived assets are considered not to be impaired.

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The enterprise value is determined based on projected cash flows attributable to the operations of the acquiree.

The projected cash flows include various assumptions, including estimated revenue growth rates, operating margins, R&D expenditures, capital expenditures, royalty rates, and appropriate risk-adjusted discount rates used to discount the projected cash flows.

The usage of different assumptions would result in the assignment of different fair values to the acquired identifiable intangible assets and, accordingly, could also impact the amount of purchase consideration assigned to goodwill.

The projected cash flows include various assumptions, including estimated revenue growth rates, operating margins, research and development expenditures, capital expenditures, royalty rates, and appropriate risk-adjusted discount rates used to discount the projected cash flows.

The use of different assumptions would result in the assignment of different fair values to the acquired identifiable intangible assets and, accordingly, could also impact the amount of purchase consideration assigned to

Similarly, changes in the planned usage of the acquired identifiable intangible assets and/or their estimated economic lives, if any, could impact the recoverability of the assets and/or amortization period and expense attributable to the assets in the future.

Measurement period adjustments are reflected at the time identified, up through the conclusion of the measurement period, which is the time at which all information for determination of the values of assets acquired and liabilities assumed is received, and is not to exceed one year from the acquisition date.

We may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill.

Measurement period adjustments are reflected at the time identified, through the conclusion of the measurement period, which is the time at which all information for determination of the values of assets acquired and liabilities assumed is received.

The measurement period is not to exceed one year from the acquisition date.

We may continue to record adjustments to the fair value of any tangible and intangible assets acquired and liabilities assumed within the relevant measurement period with the corresponding offset to goodwill.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this item is set forth beginning on page 84 on this Annual Report on Form 10-K.

The information required by this item is set forth beginning on page 88 of this Annual Report on Form 10-K.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis