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Item 7. Management’s Discussion and Analysis

2025-04-04 compared with 2025-03-03 · 236 added, 262 removed, 450 unchanged (53% of the section changed)

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

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our audited consolidated financial statements as of and for the years ended December 31, 2023 and 2022 and the related notes appearing elsewhere in this Form 10-K/A.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our audited consolidated financial statements as of and for the years ended December 31, 2024 and 2023 and the related notes appearing elsewhere in this Form 10-K.

In addition to historical consolidated financial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions.

Our actual results could differ materially from those anticipated by these forward-looking statements as a result of many factors.

We discuss factors that we believe could cause or contribute to these differences below and elsewhere in this Annual Report on Form 10-K/A, including those set forth in the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” Our fiscal years ended December 31, 2023 and 2022 are referred to herein as fiscal year 2023 and fiscal year 2022, respectively.

We discuss factors that we believe could cause or contribute to these differences below and elsewhere in this Annual Report on Form 10-K, including those set forth in the sections titled “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” Our fiscal years ended December 31, 2024 and 2023 are referred to herein as fiscal year 2024 and fiscal year 2023, respectively.

Unless the context otherwise requires, all references to “the Company,” “we,” “us,” or “our” and similar terms refer to Spire and its subsidiaries.

The following information has been adjusted only to reflect the fiscal year 2023 and fiscal year 2022 restatement of our audited consolidated financial statements as described in the “Explanatory Note” at the beginning of this Form 10-K/A, in Note 2, “Restatement of Previously Issued Financial Statements,” and in Note 16, “Restatement of Quarterly Financial Information,” in the Notes to the Consolidated Financial Statements of this Form 10-K/A.

Other than such restatements, the following information is presented as of the filing date of the Original Form 10-K, does not reflect events occurring after that date, and does not modify or update disclosures in any way other than as required to reflect the restatement of the Affected Periods included in this Form 10-K/A.

Spire is a global provider of space-based data, analytics and space services, offering unique datasets and powerful insights about Earth so that organizations can make decisions with confidence in a rapidly changing world.

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Precise space-based data used for highly accurate aircraft monitoring, aircraft safety, and route optimization.

• Weather and Climate:

Precise space-based data used for highly accurate weather forecasting.

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We leverage our fully deployed infrastructure and large-scale operations to enable our customers to obtain customized data through our API.

Our customers can begin receiving data in less than a year after engaging with us and receive data by entering into a subscription agreement.

Our Space Services offering provides our customers with fast, scalable, and reliable access to space.

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We currently sell directly to end customers and utilize reseller partners when beneficial.

Recent Developments

Sale of Maritime Business

On November 13, 2024, we entered into a Share Purchase Agreement (the “Purchase Agreement”) with Kpler Holding SA, a Belgian corporation (“Buyer”), pursuant to which we agreed to sell our maritime business to Buyer and enter into certain ancillary agreements (the “Transactions”).

The maritime business to be sold pursuant to the Transactions does not include any part of our satellite network or operations.

The purchase price to be paid by Buyer to us at the closing of the Transactions is a cash payment based upon an enterprise value of $233.5 million, subject to certain adjustments.

The Transactions also include a twelve-month transition service and data provision agreement for $7.5 million.

The Purchase Agreement provides that the closing of the Transactions is subject to the satisfaction or waiver of certain closing conditions set forth in the Purchase Agreement.

We believe all conditions to closing contained in the Purchase Agreement have been satisfied or could be satisfied.

Notwithstanding our notice to Buyer to that effect, Buyer has failed to consummate the closing.

Buyer has cited various reasons for declining to close, including a review of the Transactions by the UK Competition and Markets Authority.

We have rejected these reasons.

We believe that Buyer’s failure to close is not consistent with the terms of the Purchase Agreement, which do not give Buyer the option to delay closing once all closing conditions have been met.

As a result of the foregoing, on February 10, 2025, we filed a complaint in the Delaware Court of Chancery against Buyer seeking a grant of specific performance ordering Buyer to satisfy its obligations under the Purchase Agreement and consummate the closing in accordance with the terms of the Purchase Agreement.

In the complaint, we also requested a declaratory judgment declaring that Buyer has breached its obligations under the Purchase Agreement and is not excused from performing its obligations under the Purchase Agreement, including proceeding with the closing.

Buyer removed the matter to the District of Delaware, pursuant to a contract term in the Purchase Agreement promising not to contest removal to that court.

The District of Delaware initially selected a March 4 trial date, but on February 26, 2025, the court set a trial date of May 28-30, 2025.

There is no assurance as to what action the District of Delaware will take with respect to the proceeding initiated by us and there is no assurance as to whether or not the Transactions will be consummated on the terms contemplated or at all.

The amount of any damages which may be sought or obtained from Buyer cannot be determined at this time.

Private Placement

On March 12, 2025, we entered into a securities purchase agreement (the “Securities Purchase Agreement”) with the purchasers named therein (the “Purchasers”) for the private placement (the “2025 Private Placement”) of (i) 4,843,750 shares of our Class A common stock at a purchase price of $8.00 per share (the “Shares”) and (ii) pre-funded warrants (the “Pre-Funded Warrants”) to purchase 156,250 shares of Class A common stock (the “Warrant Shares”) at a purchase price of $7.9999 per Pre-Funded Warrant.

The Pre-Funded Warrants have an exercise price of $0.0001 per share of Class A common stock, are exercisable immediately, and will terminate when exercised in full.

The aggregate gross proceeds for the 2025 Private Placement were $40.0 million, before deducting offering expenses.

The 2025 Private Placement closed on March 14, 2025.

In addition, on March 12, 2025, we and the Purchasers also entered into a registration rights agreement, pursuant to which we agreed to file a registration statement with the Securities and Exchange Commission on or before April 30, 2025, for purposes of registering the resale of the Shares and the Warrant Share and to have such registration statement declared effective no later than June 30, 2025.

Fifth Amendment to Blue Torch Financing Agreement

On March 12, 2025, we and Blue Torch Finance LLC (“Blue Torch”) entered into the Waiver and Amendment No.

5 to Financing Agreement (the “Fifth Amendment”) to, among other things, (a) waive events of default under our financing agreement (the “Blue Torch Financing Agreement”) that we entered into with Blue Torch in June 2022 arising out of the maximum debt to EBITDA leverage ratio being greater than the ratio permitted by the Blue Torch Financing Agreement, the failure to deliver financial projections for the 2025 fiscal year and liquidity being lower than permitted by the Blue Torch Financing Agreement, (b) amend the financial covenants in the Blue Torch Financing Agreement to replace the maximum debt to EBITDA ratio with a minimum EBITDA covenant and provide relief on the recurring revenue leverage ratio set forth in the Blue Torch Financing Agreement, (c) amend the Blue Torch Financing Agreement to permit us to obtain subordinate financing secured by related liens on such junior indebtedness, (d) increase the applicable margin by 2.50% in the form of PIK interest which will be fully earned, paid-in-kind and added to the principal balance of the term loans, and (e) provide for a Fifth Amendment fee and extension fees.

The Fifth Amendment fee is equal to $2.50 million which will be paid in kind by adding such fee to the principal amount after which it bears interest from the date of the Fifth Amendment at the Adjusted Term SOFR for a 3-month interest period plus the applicable margin under the Blue Torch Financing Agreement.

The Fifth Amendment also provides for an extension fee equal to $1.0 million, but if the Blue Torch Financing Agreement is terminated and all obligations are paid in full prior to April 30, 2025, the extension fee will be waived.

If the Blue Torch Financing Agreement is not terminated and all obligations are paid in full on or before April 30, 2025, the extension fee will be added to the principal balance of the term loans on such date, and an additional extension fee in an equal amount will be added to the principal balance of the term loans on each date that is 30 days after April 30, 2025, until the Blue Torch Financing Agreement is terminated and all obligations are paid in full.

The Fifth Amendment also requires us to engage a liquidity management advisor reasonably satisfactory to Blue Torch no later than March 21, 2025, and we did so on March 21, 2025.

Highlights from Fiscal Year 2024

• Full year 2024 revenue was $110.5 million, an increase of 13% from fiscal year 2023.

• We secured a highly competitive $476 million NASA indefinite delivery, indefinite quantity (“IDIQ”) contract, together with six other companies.

Under this contract, we will provide NASA with our comprehensive catalog of Earth observation data that can improve global weather forecasting accuracy and climate research.

• We were awarded a contract extension by the National Reconnaissance Office (NRO) for commercial radio frequency remote sensing.

The agency will continue to use our data to evaluate how commercial radio frequency will be integrated into its overhead architecture.

• We were awarded a Space Services contract by Lacuna Space, a leading satellite IoT connectivity provider.

Under the agreement, Spire will initially build and launch six satellites carrying Lacuna Space’s payload and antenna, with the opportunity to scale the constellation to dozens of satellites.

Lacuna Space will operate its payloads and receive encrypted data at its Harwell headquarters.

• We announced the launch of our High Resolution Weather Forecast model, a differentiated regional high-resolution weather forecasting service designed to meet the critical demands of the energy and commodity markets.

The solution provides more precise and customizable weather forecasts extending up to six days, with the capability to be run at resolutions as fine as one kilometer, covering any point on the globe, including the most remote regions and the open oceans.

• At the Space Tech Expo Europe, we unveiled Constellation Management Platform, a web-based app that simplifies satellite constellation operations through its user-friendly interface.

The development of the platform is co-funded by the

European Space Agency (ESA) under ARTES Core Competitiveness (CC) Programme with a €1.5 million award to Spire, along with support from the Luxembourg Space Agency (LSA).

• We were awarded a $2.8 million, 12-month contract by the National Oceanic and Atmospheric Administration ("NOAA") for satellite weather data.

We will provide NOAA with Global Navigation Satellite System Reflectometry ("GNSS-R") observation data in near real-time, primarily focusing on ocean surface wind speeds.

The initiative addresses NOAA’s critical need for global sea-surface wind measurements essential for applications like marine weather forecasts, hurricane tracking, ocean current analysis and climate studies.

• We were awarded a $4.6 million, 12-month contract by NASA on behalf of NOAA to participate in NOAA’s Sounder for Microwave-Based Applications ("SMBA") Phase-A study.

Following the completion of the 12-month contract, a single sounder from the finalists may be selected for additional contract phases.

The data collected from the final Microwave Sounder will be used towards advancing Earth observation, providing insights into various atmospheric properties such as temperature, humidity, cloud cover and composition.

• We announced that we will participate in a challenge to advance measurements of the Earth’s magnetic field.

As part of the challenge, we will receive monetary support from the National Geospatial-Intelligence Agency.

We will design, develop and launch a satellite that will provide a novel approach to geomagnetic data collection for the World Magnetic Model (WMM).

• We signed an agreement with OroraTech to build, launch and operate an eight-satellite constellation dedicated to global temperature monitoring.

OroraTech has successfully operated a precursor sensor in orbit on a satellite designed, built and operated by Spire for 18 months.

• We signed a renewed and increased contract from NASA as part of its Commercial Smallsat Data Acquisition program.

The contract was increased to $6.5 million for one year of Earth observation data including:

GNSS Radio Occultation, which can be assimilated into weather models;

GNSS-Reflectometry, which can measure sea ice, soil moisture, and ocean surface wind speed;

and space weather measurements.

• We announced a Space Services contract with GHGSat, a global leader in high-resolution greenhouse gas monitoring from space.

Under the agreement, Spire will build, launch and operate four additional 16U satellites that will carry GHGSat payloads to monitor greenhouse gas emissions.

This builds upon Spire's initial agreement with GHGSat for three 16U satellites.

• We announced a €16 million, three-year contract to design and demonstrate a satellite-based aviation surveillance system for ESA's EURIALO program.

By independently verifying the location of a plane through geolocation technology, the most advanced and reliable system for aircraft tracking and surveillance, it is possible to track a plane in real time from takeoff to landing anywhere in the world.

Following the initial design and demonstrator phases, there is a potential opportunity for Spire to be selected to build the full constellation, which could include a large number of satellites.

• We were awarded a $9.4 million contract in January 2024 and another $3.8M contract in September 2024 by the National Oceanic and Atmospheric Administration (“NOAA”) for Satellite Weather and Climate Data (“RO”).

• We began a collaboration with Signal Ocean to drive digitalization of the maritime economy and Signal Ocean made a $10 million strategic investment in the Company.

• We were awarded €8.4 million by the European Maritime Safety Agency (EMSA) for the provision of SAT-AIS data services.

• We began collaborating with NVIDIA to enhance artificial intelligence (“AI”)-driven weather prediction.

• We announced a space services deal to scale constellation for HANCOM InSpace.

• We signed a Memorandum of Cooperation with Thales and the European Satellite Services Provider (ESSP) to develop a space-based air traffic surveillance service.

Phase A of the contract was signed and is effective as of June 28, 2024.

• We joined the Russell 3000 Index on June 27, 2024.

• We announced a contract with the Government of Canada for ship tracking data in July 2024.

• We signed a multi-year agreement with a government customer to manufacture satellites and provide geolocation data.

• We and OroraTech were awarded a NASA contract for wildfire monitoring.

• We launched seven LEMUR satellites on SpaceX Transporter-11 mission.

• We announced a mission to explore the power of AI in space with Mission Control, showcasing how AI can be reliably used onboard satellites over a long period of time to generate actionable insights in real-time.

• We announced on November 13, 2024, that we entered into the Purchase Agreement with Buyer, pursuant to which we agreed to sell our maritime business to Buyer for a purchase price of $233.5 million, subject to certain adjustments.

The Transactions also include a twelve-month transition service and data provision agreement for $7.5 million.

Macroeconomic and Geopolitical Impact

Over the past two years, we have been impacted by the macroeconomic environment, such as fluctuations in foreign currencies, increasing interest rates and geopolitical conflicts like the Russian invasion of Ukraine, Israel's war with Hamas and the increased tensions between China and the U.S.

dollar exhibited a modest increase in strength against the local functional currencies of our foreign subsidiaries for the fiscal year ended December 31, 2023, compared to the fiscal year ended December 31, 2022.

This had a marginal negative impact on our revenue, as about one-third of our sales are conducted in foreign currencies.

Conversely, it had a marginal favorable impact on our expenses, given that a majority of our workforce resides in countries other than the United States.

The macroeconomic environment has caused existing or potential customers to re-evaluate their decision to purchase our offerings, at times resulting in additional customer discounts, extended payment terms, longer sales cycles, and a few contract cancellations.

Particularly, the U.S.

Congress' delay in approving appropriations bills negatively impacted the timeliness of some of our U.S.

Dollar exhibited a decrease in strength against the local functional currencies of our foreign subsidiaries for the fiscal year ended December 31, 2024, as compared to the fiscal year ended December 31, 2023.

Dollar's decrease had a positive impact on our revenue, as approximately one-third of our sales are conducted in foreign currencies.

Conversely, the decrease in the value of the U.S.

Dollar had an unfavorable impact on our expenses, given that a majority of our workforce resides in countries other than the United States.

Particularly, government agency delays in approving appropriations bills negatively impacted the timeliness of some of our U.S.

federal government orders.

Additionally, recent changes to tariffs could cause interruptions in our supply chain or increase spending to meet our obligations.

Increasing interest rates in the fiscal year ended December 31, 2024 resulted in higher interest expenses, as our credit facility is based on a floating interest rate.

The Russian invasion of Ukraine and the continued conflict created additional global sanctions, which at times caused scheduling shifts or launch cancellations by third-party satellite launch providers, which delayed revenue recognition of certain sales contracts.

If any of these factors continue or worsen, and/or if new macroeconomic or geopolitical issues arise, our results and financial condition could be further negatively impacted.

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Key Factors Affecting Our Performance

We believe that our current and future performance depend on many factors, including, but not limited to, those described below.

We believe that our current and future performance depends on many factors, including, but not limited to, those described below.

While these areas present significant opportunity, they also present risks that we must manage to achieve successful results.

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Our future revenue growth and our path to profitability are dependent upon our ability to continue to land new customers and then expand adoption of our solutions within their organizations.

We track our progress landing new customers by measuring the number of ARR Solution Customers we have from one fiscal year to the next.

For instance, we have increased our number of ARR Solution Customers from 733 as of December 31, 2022 to 745 as of December 31, 2023.

We track our progress in expanding our customer relationships by measuring our ARR Net Retention Rate.

For the definition of ARR Net Retention Rate, see the section titled “—Key Business Metrics.” Our ARR Net Retention Rate was 98% for fiscal year 2023 and our organic ARR Net Retention Rate was 117% for fiscal year 2022.

We track our progress landing new customers by measuring the number of ARR Solution Customers (as defined below) we have from one fiscal year to the next.

The number of ARR Solution Customers decreased to 621 as of December 31, 2024, from 745 as of December 31, 2023.

We track our increases and decreases in our customer contract values by measuring our ARR Net Retention Rate (as defined below).

Our ARR Net Retention Rate was 93% for fiscal year 2024 and 98% for fiscal year 2023.

Expansion into New Industries and Geographies

As our solutions have grown, we continue to focus on further penetration of our initial industries including maritime, aviation, logistics and government (civil and defense/intelligence) among others.

We believe our technology and solutions give us the ability to also expand into additional industries, including energy, financial services, agriculture, transportation, and insurance, and into additional geographies, including Latin America, Africa, and the Middle East.

As our solutions grow, we continue to focus on further penetration of our initial industries including maritime, aviation, logistics, and government (civil and defense/intelligence).

We believe our technology and solutions give us the ability to expand into additional industries, including energy, financial services, agriculture, transportation, and insurance, and also into additional geographies, including Latin America, Africa, and the Middle East.

Our revenue growth is dependent upon our ability to continue to expand into new industries and geographies.

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In October of 2023, NOAA updated their projection for the strength and duration of Solar Cycle 25, stating that the cycle is expected to be more intense than Cycle 24, and predicting that the peak of the cycle would be earlier, by the end of 2024.

A stronger solar cycle may accelerate the deorbiting of our satellites sooner than expected or planned.

A stronger solar cycle has accelerated the deorbiting of our satellites sooner than expected or planned.

Our ability to minimize the solar cycle impact, our ability to replenish our existing constellation in a timely manner and the costs associated with these actions may adversely affect our results of operations.

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Impact of Foreign Exchange Rates

We report in U.S.

dollars, and the functional currency of our foreign operating subsidiaries is the local currency, including the Euro, the British Pound, the Singapore Dollar and the Canadian Dollar.

dollar remained strong against those currencies compared to fiscal year 2022.

In fiscal year 2023, approximately 31% of our revenues were generated in non-U.S.

dollar-denominated currencies.

This compares to fiscal year 2022 when approximately 41% of our revenues were generated in non-U.S.

dollar-denominated currencies.

Our reporting currency is the U.S.

The functional currencies of our foreign operating subsidiaries is the local currency in which each subsidiary operates, including the Euro, the British Pound, the Singapore Dollar and the Canadian Dollar.

Dollar exhibited a decrease in strength against the local functional currencies of our foreign subsidiaries for fiscal year 2024 as compared to fiscal year 2023.

Dollar's decrease had a positive impact on our revenue, as approximately one-third of our sales are conducted in foreign currencies.

Conversely, the decrease in the value of the U.S.

Dollar had an unfavorable impact on our expenses, given that a majority of our workforce resides in countries other than the United States.

Approximately 31% of our revenues were generated in currencies other than the U.S.

Dollar for each of the years ended December 31, 2024 and 2023.

The financial statements of these subsidiaries are translated into U.S.

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Annual Recurring Revenue

We define ARR as our expected annualized revenue from customers that are under contracts with us at the end of the reporting period with a binding and renewable agreement for our subscription solutions or customers that are under a binding multi-year contract that can range from components of our Space Services solution to a project-based customer solution.

contract that can range from components of our Space Services solution to a project-based customer solution.

Customers with Space Services Contracts are considered recurring when there is a multi-year binding agreement that has a renewable component in the contract.

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Customer contracts for data trials and one-time transactions are excluded from the calculation of ARR.

Our ARR growth in 2023 was driven by landing new ARR Customers (as defined below) along with increasing the amount of ARR business with our existing customers.

Due in part to the timing of some of our Space Services Contracts, including when engagements start and stop, our ARR has fluctuated from period to period in the past, and we expect our ARR to continue to fluctuate from period to period in the future.

For example, NOAA awarded us an eight month, $9.4 million, radio occultation sales order on January 4, 2024.

Due to the timing of this agreement, our ARR for fiscal year 2023 did not include revenue from this agreement.

The ARR value related to this agreement is $14.1 million.

The increase in our ARR in fiscal year 2024 was primarily driven by increasing the amount of ARR business with our existing customers.

Our ARR has fluctuated from period to period in the past due in part to the timing of some of our Space Services Contracts, including when engagements start and stop.

We expect our ARR to continue to fluctuate from period to period in the future.

ARR is a leading indicator and accordingly, will tend to outpace the impact on our revenue as we recognize the contract value of various agreements over time.

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Number of ARR Customers and ARR Solution Customers

We define an ARR Customer as an entity that has a contract with us or through our reseller partners contracts, that is either a binding and renewable agreement for our subscription solutions, or a binding multi-year contract as of the measurement date

independent of the number of solutions the entity has under contract.

A single organization with separate subsidiaries, segments, or divisions may represent multiple customers, as we treat each entity that is invoiced separately as an individual customer.

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Our multiple solutions customers are those that are under contract for at least two of our solutions:

Maritime, Aviation, Weather, and Space Services.

Maritime, Aviation, Weather and Climate, and Space Services.

All entities that have contracts for data trials and one-time transactions are excluded from the calculation of ARR Solution Customers.

The growth in each of our ARR Customers and ARR Solution Customers in 2023 was driven by landing new ARR Customers across our four solutions (Maritime, Aviation, Weather and Space Services), expanding our industry and geographical footprints, and having a low number of customers who have not renewed their contracts with us.

This was partially offset by our move to de-emphasize sales to customers with very low ARR or revenue.

We expect this strategy to increase our ARR and revenue per customer, increase our ARR in total, and reduce our customer count as we drive towards the most efficient use of our resources.

The decrease in each of our ARR Customers and ARR Solution Customers in fiscal year 2024 was driven by our move to de-emphasize sales to customers with very low ARR or revenue.

We expect this strategy to ultimately increase our ARR and revenue per customer, increase our ARR in total, and reduce our customer count as we drive towards the most efficient use of our resources.

The following table summarizes the number of our ARR Customers and ARR Solution Customers at the end of fiscal years 2024 and 2023.

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The following table summarizes our ARR Net Retention Rate for each of fiscal years 2024 and 2023:

The ARR Net Retention Rate for 2022 excludes the Acquisition (as defined below) due to lack of comparable data, which would require 2021 data for renewal base calculations.

Year Ended December 31,

ARR Net Retention Rate

Our ARR Net Retention Rate can be impacted from period to period by large increases or decreases in customer contract value and large decreases in contract value from customers that have not renewed their contracts with us.

An ARR Net Retention Rate greater than 100% is an indication that we are growing the value of the solutions our customers are purchasing from us from a fiscal period end versus the prior fiscal period end.

An ARR Net Retention Rate less than 100% is an indication that we are reducing the value of the solutions our customers are purchasing from us from a fiscal period end versus the prior fiscal period end.

For fiscal year 2023, our ARR Net Retention Rate was impacted by the temporary loss of our NOAA radio occultation order in July 2023 and the award of the $9.4 million order that was delayed until January 2024 as referenced above.

An ARR Net Retention Rate greater than 100% is an indication that we are growing the value of the solutions our customers are purchasing from us at current fiscal year ended versus the prior fiscal year end.

An ARR Net Retention Rate less than 100% is an indication that the value of the solutions our customers are purchasing from us declined at current fiscal year end versus the prior fiscal year end.

Our ARR Net Retention Rate decreased by 5% for fiscal year 2024 driven primarily by the reduced value of NOAA's RO weather award as compared to the value of the corresponding award in fiscal year 2023.

Components of Results of Operations

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We contract with third-party companies to launch, carry, and deploy our satellites into space.

A loss could result from a third-party launch or deployer failure, a technical failure of the satellite, or the deorbit or decommissioning of a satellite before the end of the

satellite’s useful life.

A loss could result from a third-party launch or deployer failure, a technical failure of the satellite, or the deorbit or decommissioning of a satellite before the end of the satellite’s useful life.

A technical failure could include a satellite that is not able to communicate with our network of ground stations or fulfill its intended technical mission for a duration greater than one month.

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Change in fair value of warrant liabilities includes mark-to-market adjustments to reflect changes in the fair value of warrant liabilities and the exchange of warrants for common stock.

Loss on Extinguishment of Debt.

Loss on extinguishment of debt includes accelerated debt issuance expenses, legal and other fees associated with the payoff or refinancing of existing debt.

Issuance of Stock Warrants.

Issuance of stock warrants includes expense related to the value of the right to purchase company shares.

Foreign Exchange Gain/Loss.

Foreign exchange gain/loss consists of the net effect of realized and unrealized foreign currency gains and losses resulting from changes in the currency exchange rates for transactions denominated in non-functional currency relative to each subsidiary’s functional currency.

We use the local currency as our functional currency for our subsidiaries in Luxembourg, the United Kingdom, Singapore, Australia, Germany, and Canada.

Other Expense, Net.

Other expense, net consists primarily of tax credits, grant income, the impact of foreign exchange gains and losses, share of equity investment loss, all transaction costs and other administrative fees associated with the warrant exchange, and write-off of certain prepaid assets.

Other expense, net consists primarily of tax credits, grant income, share of equity investment loss, and write-off of certain prepaid assets.

Income Tax Provision

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We account for income taxes using the asset and liability method, whereby deferred tax assets and liabilities are recognized based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted rates and laws that will be in effect when the differences are expected to reverse.

Results of Operations (As Restated)

Results of Operations

Fiscal Year 2024 Compared to Fiscal Year 2023

The following tables set forth selected consolidated statements of operations data for each of the periods indicated:

Years Ended December 31,

Year Ended December 31,

(in thousands)

(As Restated)

Cost of revenue (1)

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Change in fair value of warrant liabilities

Loss on extinguishment of debt

Issuance of stock warrants

Foreign exchange (loss) gain

Other expense, net

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Loss before income taxes

Income tax provision

Income tax provision (benefit)

(1) Includes stock-based compensation as follows:

Years Ended December 31,

Year Ended December 31,

(in thousands)

(As Restated)

Cost of revenue

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Total stock-based compensation

Revenue (As Restated)

Years Ended December 31,

Year Ended December 31,

(dollars in thousands)

(As Restated)

Total revenue increased $26.8 million, or 38%, driven primarily by the growth in the number of ARR Customers combined with growth in revenue recognized for Space Services Contracts.

For fiscal year 2023, we derived 50% of our revenue from the Americas, 36% of our revenue from Europe, the Middle East and Africa (“EMEA”), and 14% of our revenue from Asia Pacific (“APAC”).

Total revenue increased $12.8 million, or 13%, primarily driven by increased ARR business combined with growth in revenue recognized for Space Services Contracts.

For fiscal year 2024, we derived 57% of our revenue from the Americas;

36% of our revenue from Europe, the Middle East and Africa (“EMEA”);

and 7% of our revenue from Asia Pacific (“APAC”).

For fiscal year 2023 we derived 50% of our revenue from the Americas, 36% of our revenue from EMEA, and 14% of our revenue from APAC.

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This percentage mix can fluctuate significantly from period to period driven primarily by the timing of non-subscription revenue recognition in our contracts.

Cost of Revenue (As Restated)

Years Ended December 31,

Cost of Revenue

Year Ended December 31,

(dollars in thousands)

(As Restated)

Total cost of revenue

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R&D Services Contracts expenses are included in cost of revenue.

Cost of revenue increased $5.4 million, or 10%, primarily driven by an increase in satellite operation expense of $4.7 million and an increase in depreciation expense of $3.0 million, partially offset by a decrease in personnel costs of $1.4 million, a decrease in computing costs of $0.8 million and a decrease in other miscellaneous expenses of $0.1 million.

Cost of revenue increased $11.5 million, or 20%, primarily driven by an increase in satellite operation expense of $4.4 million, an increase in depreciation expense of $3.6 million, an increase in personnel expenses of $1.9 million, and an increase in downlink data service expenses of $1.7 million, partially offset by a decrease in other miscellaneous expenses of $0.1 million.

The increase in satellite operation expense was driven by recognition of launch costs associated with a Space Services Contract.

The increase in depreciation expense was primarily driven by a reset of the estimated useful lives of our satellites to account for the potential impact of increased solar activity related to the current solar cycle.

The decrease in personnel costs was driven by an overall reduction in headcount.

The decrease in computing costs was driven by cloud platform efficiencies.

The increase in depreciation expense was primarily driven by a reset of the estimated useful lives of our satellites to account for the impact of increased solar activity related to the current solar cycle.

The increase in personnel costs was driven by increased work related to R&D Services Contracts during the period, which causes a greater proportion of costs to be allocated to cost of revenue.

The increase in downlink data service expenses was primarily driven by the purchase of supplemental data to support a radio frequency geolocation contract.

Gross margin for fiscal years 2024 and 2023 was 36% and 40%, respectively.

The increase in fiscal year 2023 compared to fiscal year 2022 was driven primarily by leverage from higher revenue.

This metric can fluctuate significantly from period to period driven primarily by the amount and timing of the revenue as well as the timing of our technology investments.

The decrease was driven primarily by the higher expenses described above.

Our gross margin can fluctuate significantly from period to period driven primarily by the timing of the revenue as well as the timing of our technology investments to support future growth.

We expect cost of revenue, including depreciation and amortization expenses, third-party operating costs and royalties, and high-powered computing costs, to increase in absolute dollars as our business grows.

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however, we expect our operating expenses as a percentage of revenue to decrease over time.

Research and Development (As Restated)

Years Ended December 31,

Research and Development

Year Ended December 31,

(dollars in thousands)

(As Restated)

Research and development

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R&D Services Contracts expenses are included in cost of revenue.

Research and development expenses increased $5.6 million, or 25%, primarily driven by an increase in personnel costs of $5.4 million and an increase in computing costs of $0.2 million to support customer growth.

The increase in personnel costs was driven by overall growth in headcount, which was partially offset by lower bonus payouts to management.

Research and development expenses increased $1.5 million, or 6%, primarily driven by an increase in personnel costs of $2.2 million, partially offset by a decrease in travel and entertainment expenses of $0.4 million and a decrease in other miscellaneous operating expenses of $0.3 million.

The increase in personnel costs was driven by overall growth in headcount.

The decrease in travel and entertainment expenses was driven by reduced travel within the period.

We expect research and development expenses to increase in absolute dollars in future periods primarily due to higher headcount as we continue to invest in the development of our solutions offerings and new technologies;

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Sales and Marketing

Years Ended December 31,

Year Ended December 31,

(dollars in thousands)

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Headcount (at end of year)

Sales and marketing expenses decreased $2.7 million, or 10%, primarily driven by a decrease in amortization expenses of $2.9 million and a decrease in personnel costs of $0.5 million, partially offset by an increase in bad debt expenses of $0.6 million and an increase in other miscellaneous operating expenses of $0.1 million.

The decrease in amortization expenses was due to the completion of purchased intangible amortization from the Acquisition, which was completed in the three-month period ended December 31, 2022.

The decrease in personnel costs was driven by an overall reduction in headcount.

The increase in bad debt expenses was primarily driven by a charge taken for a specific customer reserve.

Sales and marketing expenses decreased $3.5 million, or 14%, primarily driven by a decrease in personnel costs of $1.5 million, a decrease in marketing expenses of $0.8 million, a decrease in bonus and commission expenses of $0.8 million, and a decrease in bad debt expenses of $0.6 million, partially offset by an increase in other miscellaneous operating expenses of $0.2 million.

The decrease in personnel costs was driven by an overall reduction in headcount and attrition savings throughout the year.

The decrease in marketing expenses was driven by lower advertising and event spend compared to the prior year period.

The decrease in bonus and commission expenses was primarily driven by lower bonus accruals for management.

The decrease in bad debt expenses was driven by cash collections and recovery efforts.

We expect sales and marketing expenses to generally grow in absolute dollars in the future, primarily due to increased employee-related expenses as we grow our headcount, to support our sales and marketing efforts and our continued expansion of our sales capacity across our solutions;

however, we expect sales and marketing expenses as a percentage of revenue to decrease in future periods as our revenue growth exceeds our increases in sales and marketing spend.

General and Administrative (As Restated)

Years Ended December 31,

General and Administrative

Year Ended December 31,

(dollars in thousands)

(As Restated)

General and administrative

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Headcount (at end of year)

General and administrative expenses decreased $2.9 million, or 6%, primarily driven by a decrease in business insurance costs of $2.8 million, a decrease in professional services fees of $1.5 million and a decrease in other miscellaneous operating expenses of $0.4 million, partially offset by an increase in facilities expenses of $0.8 million, an increase in software expenses of $0.8 million and an increase in personnel costs of $0.2 million.

The decrease in business insurance costs was driven by an improvement in annual rates.

The decrease in professional services fees was driven by lower third-party accounting, legal and other consulting services as compared to the prior year when there were increased costs related to the Acquisition and our merger with NavSight Holdings, Inc.

on August 16, 2021 (the “Merger”).

The increases in personnel costs and facilities expenses were driven by overall headcount growth which were partially offset by lower bonus payouts to management.

The increase in software expenses was driven by headcount growth and scaling of operations.

General and administrative expenses increased $7.7 million, or 18%, primarily driven by an increase in professional services expenses of $6.4 million and an increase in stock-based compensation expense of $3.7 million, partially offset by a decrease in insurance costs of $1.2 million, a decrease in severance expenses of $1.0 million and a decrease in other miscellaneous operating expenses of $0.2 million.

The increase in professional services fees was driven by higher third-party accounting, legal and other consulting services relating to the restatement.

The increase in stock-based compensation expense was driven by higher stock grants which resulted in a higher total value of stock-based awards recognized in the current year.

The decrease in business insurance costs was driven by an improvement in annual rates particularly on directors and officers insurance.

The decrease in severance expenses was driven by lower severance payouts in the current year compared to the prior year.

We expect our general and administrative expenses to generally grow in absolute dollars in future periods as our employee-related expenses increase to support our revenue growth;

however, we expect our general and administrative expenses as a percentage of revenue to decrease as revenue growth exceeds our increases in general and administrative spend.

Loss on Decommissioned Satellites (As Restated)

Years Ended December 31,

Loss on Decommissioned Satellites

Year Ended December 31,

(dollars in thousands)

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Percentage of total revenues

In fiscal years 2023 and 2022, we recognized a non-cash expense of $0.7 million and $0.5 million, respectively, on decommissioned satellites prior to the ends of their useful lives.

We recognized a non-cash expense of $3.4 million and $0.7 million in fiscal years 2024 and 2023, respectively, on decommissioned satellites prior to the ends of their useful lives.

Due to the nature of these events, we cannot predict the magnitude or frequency of future decommissioning losses.

While we sometimes purchase launch insurance when financially practical, the proceeds from these policies will typically only cover a portion of our loss in the event of an unplanned satellite deorbit or launch failure.

Allowance for Current Expected Credit Loss on Notes Receivable (As Restated)

Years Ended December 31,

Allowance for Current Expected Credit Loss on Notes Receivable

Year Ended December 31,

(dollars in thousands)

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Allowance for current expected credit loss on notes receivable increased by $2.8 million relating to a note receivable of $4.5 million and accrued interest of $0.7 million issued to a Space Services customer.

Other Income (Expense) (As Restated)

Years Ended December 31,

Other Income (Expense)

Year Ended December 31,

(dollars in thousands)

(As Restated)

Interest income

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Change in fair value of warrant liabilities

Loss on extinguishment of debt

Issuance of stock warrants

Foreign exchange (loss) gain

Other expense, net

*Not meaningful

Interest income increased by $1.4 million as we drew down on the remaining portion of our Blue Torch term loan and shifted more liquid assets into short-term marketable securities that carried higher overall interest rates.

Interest expense increased $5.1 million, or 36%, primarily as a result of drawing down on our remaining balance of the Blue Torch Finance LLC (“Blue Torch”) term loan and incurring higher interest and amortized debt issuance costs associated with the Blue Torch term loan.

Change in fair value of contingent earnout liability experienced a reduction year over year of $9.5 million driven by the mark-to-market adjustments in 2022 to reflect the fair market valuation of the underlying stock price not repeating in 2023.

During 2023 the contingent earnout liability remained relatively flat, resulting in a moderate $0.1 million profit.

Interest income decreased by $0.8 million, or 34%, primarily as a result of converting short-term marketable securities to cash and cash equivalents to be used for working capital purposes.

Interest expense increased by $1.3 million, or 7%, primarily as a result of incurring higher amortized debt issuance costs associated with the Blue Torch term loan.

Change in fair value of contingent earnout liability increased year over year by $1.4 million driven by the mark-to-market adjustments in fiscal year 2024 to reflect the fair market valuation of the underlying stock price.

During fiscal year 2023 the contingent earnout liability remained relatively flat, resulting in a moderate $0.1 million gain.

For additional information, see Notes 2 and 9 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Change in fair value of warrant liabilities was a loss of $1.6 million for the year ended December 31, 2023 compared to a gain of $8.8 million in fiscal year 2022.

The $1.6 million loss for the year ended December 31, 2023 was primarily driven by mark-to-market adjustments.

Change in fair value of warrant liabilities was a loss of $5.3 million for fiscal year 2024 compared to a loss of $1.6 million in fiscal year 2023.

The $5.3 million loss for fiscal year 2024 was primarily driven by mark-to-market adjustments to reflect the fair market valuation of the underlying stock price.

This was also impacted by the issuance of new warrants and reduction in the exercise price of the Blue Torch warrants in connection with the Waiver and Amendment (as defined below).

For additional information, see Notes 2, 6 and 8 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

There was no extinguishment of debt in fiscal year 2023.

The loss on extinguishment of debt in fiscal year 2022 was $22.5 million, driven by the acceleration of unamortized debt issuance costs and other administrative expenses associated with the extinguishment of the credit agreement with FP Credit Partners, L.P.

Other expense, net decreased by $2.0 million, or 73%, for fiscal year 2023, primarily due to a foreign exchange gain of $2.4 million driven by the strengthening of the U.S.

dollar during the year relative to the local currencies of our subsidiaries, namely the Euro, British Pound Sterling, Singapore Dollar, and Canadian Dollar and the impact on the customer receivables recorded upon initial sale, partially offset by an increase in equity investment losses of $0.2 million.

Income Taxes (As Restated)

Years Ended December 31,

For additional information, see Notes 2, 7, and 9 to our consolidated financial statements included in this Annual Report on Form 10-K.

Issuance of stock warrants was a net loss of $2.4 million for fiscal year 2024, compared to no such expense for fiscal year 2023, as a result of a definitive Securities Purchase Agreement with institutional investors that included the issuance of common stock warrants in March 2024.

We recognized a foreign exchange loss of $4.3 million for the year ended December 31, 2024, compared to a foreign exchange gain of $1.5 million for the year ended December 31, 2023, a change of 383%.

The $4.3 million loss for the year ended December 31, 2024, was primarily due to the remeasurement of intercompany balances between our Luxembourg entity and the U.S.

entity denominated in U.S.

The weakening of the U.S.

Dollar for year ended December 31, 2024, relative to the Euro at December 31, 2023, triggered the remeasurement and unrealized losses.

The gain of $1.5 million for the year ended December 3, 2023, was primarily due to the remeasurement of intercompany balances between our United Kingdom entity and the U.S.

entity denominated in U.S.

The weakening of the U.S.

Dollar for the year ended December 31, 2024, relative to the British Pound Sterling at December 31, 2023, triggered the remeasurement and unrealized gains.

Other expense, net decreased by $0.4 million, or 16%, primarily due to a $1.1 million loss in Virgin Orbit launch prepayment recorded in the year ended December 31, 2023 that did not recur.

Year Ended December 31,

(dollars in thousands)

(As Restated)

Income tax (benefit) provision

Income tax provision of $0.3 million during the year ended December 31, 2022 changed to an income tax benefit of $0.1 million during the year ended December 31, 2023, primarily driven by the impact of higher tax credits.

Income tax provision (benefit)

Income tax provision of $0.2 million during the year ended December 31, 2024 increased from an income tax benefit of $0.1 million during the year ended December 31, 2023, primarily driven by higher income in our United Kingdom subsidiary.

Non-GAAP Financial Measures

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For the reasons set forth below, we believe that excluding the following items provides information that is helpful in understanding our results of operations, evaluating our future prospects, comparing our financial results across accounting periods, and comparing our financial results to our peers, many of which provide similar non-GAAP financial measures.

• Loss on satellite deorbit, launch failure and decommissioning.

We exclude loss on satellite deorbit, launch failure and decommissioning because if there was no loss, the expense would be accounted for as depreciation and would also be excluded as part of our EBITDA calculation.

• Other (expense) income, net.

• Loss on decommissioned satellites.

We exclude loss on decommissioned satellites because if there was no loss, the expense would be accounted for as depreciation and would also be excluded as part of our EBITDA calculation.

• Other expense, net.

We exclude other (expense) income, net because it includes unusual items that do not reflect the underlying operational results of our business.

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Spire excludes this as it does not reflect the underlying cash flows or operational results of the business.

• Loss on extinguishment of debt.

• Issuance of stock warrants.

We exclude this as it does not reflect the underlying cash flows or operational results of the business.

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Since such realized and unrealized foreign currency gains and losses are the result of macro-economic factors and can vary significantly from one period to the next, we believe that exclusion of such realized and unrealized gains and losses is useful to management and investors in evaluating the performance of our ongoing operations on a period-to-period basis.

• Amortization of purchased intangibles.

We incur amortization expense for purchased intangible assets in connection with acquisitions of certain businesses and technologies.

Amortization of intangible assets is a non-cash expense and is inconsistent in amount and frequency because it is significantly affected by the timing, size of acquisitions and the inherent subjective nature of purchase price allocations.

Because these costs have already been incurred and cannot be recovered, and are non-cash expenses, we exclude these expenses for our internal management reporting processes.

Our management also finds it useful to exclude these charges when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods.

It is important to note that while this amortization expense is excluded for purposes of non-GAAP presentation, the revenue of the acquired businesses is reflected in the non-GAAP measures and that the assets contribute to revenue generation.

• Other acquisition accounting amortization.

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Amortization of this asset is a non-cash expense that can be significantly affected by the inherent subjective nature of the assigned value and useful life.

Because this cost has already been incurred and cannot be recovered, and is a non-cash expense, we exclude this expense for our internal management reporting processes.

We exclude this amortization expense for our internal management reporting processes because it has already been incurred and is a non-cash expense.

Our management also finds it useful to exclude this charge when assessing the appropriate level of various operating expenses and resource allocations when budgeting, planning and forecasting future periods.

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We exclude these as they are unusual items that do not reflect the ongoing operational results of our business.

Examples of these types of expenses include fees associated with a vendor dispute legal settlement in 2023.

Examples of these types of expenses include accounting, legal and other professional fees associated with the financial restatement, the Transactions, and customer contract enforcement.

We define EBITDA as net income (loss), plus depreciation and amortization expense, plus interest expense, and plus the provision for (or minus benefit from) income taxes.

• Adjusted EBITDA.

We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, further adjusted for any loss on satellite deorbit, launch failure and decommissioning, change in fair value of warrant liabilities, change in fair value of contingent earnout liability, other (expense) income, net, stock-based compensation, loss on extinguishment of debt, foreign exchange gain/loss, other acquisition accounting amortization, mergers and acquisition related expenses, and other unusual costs.

We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, further adjusted for any loss on decommissioned satellites, change in fair value of warrant liabilities, change in fair value of contingent earnout liability, issuance of common stock warrants, other (expense) income, net, stock-based compensation, foreign exchange gain/loss, other acquisition accounting amortization, mergers and acquisition related expenses, and other unusual and infrequent costs.

We believe Adjusted EBITDA can be useful in providing an understanding of the underlying results of operations and trends, an enhanced overall understanding of our financial performance and prospects for the future.

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The following table outlines the reconciliation from net loss to Adjusted EBITDA for the periods indicated:

Years Ended December 31,

Year Ended December 31,

(in thousands)

(As Restated)

Depreciation & amortization

Interest, net

Adjustments to EBITDA:

Change in fair value of contingent earnout liability

Change in fair value of warrant liabilities

Loss on extinguishment of debt

Issuance of stock warrants

Foreign exchange loss (gain)

Other expense, net

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Mergers and acquisition related expenses

Other unusual and infrequent costs

Loss on decommissioned satellites

Other unusual and infrequent costs

Other acquisition accounting amortization

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• Adjusted EBITDA does not reflect income tax payments that may represent a reduction in cash available to us;

• Adjusted EBITDA does not reflect the decommissioned satellite deorbit, launch failure and decommissioning and does not reflect the cash capital expenditure requirements for the replacements of lost satellites.

• Adjusted EBITDA does not reflect decommissioned satellites and does not reflect the cash capital expenditure requirements for the replacements of lost satellites.

While these expenses could occur in a given year, the existence and magnitude of these costs could vary greatly and are unpredictable.

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Liquidity and Capital Resources

Our principal sources of liquidity to fund our operations are from cash and cash equivalents, and marketable securities which totaled $40.9 million as of December 31, 2023, mainly from net proceeds from borrowings under the Blue Torch Credit Facility (as defined below) and the sale of common stock under the Equity Distribution Agreement with Canaccord Genuity LLC, as sales agent (the "Equity Distribution Agreement").

Of the $40.9 million total, $29.1 million was in cash and cash equivalents of which approximately $13.7 million was held outside of the United States.

The remaining $11.7 million was held in short-term marketable securities, all of which was held in the United States and which can be converted to cash with minimal transaction costs.

These amounts compare to cash and cash equivalents of $47.2 million as of December 31, 2022, of which $18.8 million was held outside of the United States.

We had $23.1 million of short-term marketable securities as of December 31, 2022.

The cash and cash equivalent amounts are exclusive of restricted cash which totaled $0.5 million as of December 31, 2023 and $0.4 million for December 31, 2022.

Our principal sources of liquidity to fund our operations are from cash and cash equivalents, which totaled $19.2 million as of December 31, 2024, mainly from net proceeds from borrowings under the Blue Torch Credit Facility (as defined below), proceeds from the 2024 Private Placement and Offering (each as defined below), and the sale of common stock under the Equity Distribution Agreement with Canaccord Genuity LLC, as sales agent (the "Equity Distribution Agreement").

Of the $19.2 million total cash and cash equivalents, approximately $14.4 million of which was held outside of the United States and the remaining $4.8 million was held in the United States.

These amounts compare to cash and cash equivalents and marketable securities of $40.9 million as of December 31, 2023, of which $29.1 million was in cash and cash equivalents and the remaining $11.7 million was in short-term marketable securities, which can be converted to cash with minimal transaction costs.

Of the $40.9 million total cash and cash equivalents and marketable securities, $13.7 million was held outside of the United States.

The cash and cash equivalent amounts are exclusive of restricted cash, which totaled $0.5 million as of each of December 31, 2024 and 2023.

Since our inception, we have been in an operating cash flow deficit as we have made significant investments in our technology infrastructure, built out our research and development foundation, grown sales and marketing resources to drive revenue, and scaled general and administrative functions to enable operating effectiveness.

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The 2024 Private Placement closed on February 8, 2024, resulting in gross proceeds to us of $10.0 million.

On March 21, 2024, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with institutional investors (the “Investors”), pursuant to which the Company issued and sold in a registered direct offering (the “Offering”), (i) an aggregate of 2,142,858 shares of Class A common stock and (ii) warrants exercisable for an aggregate of 2,142,858 shares of Class A common stock ("Securities Purchase Agreement Warrants") to the Investors.

On March 21, 2024, we entered into a Securities Purchase Agreement with institutional investors (the “Investors”), pursuant to which we issued and sold in a registered direct offering (the “Offering”), (i) an aggregate of 2,142,858 shares of Class A common stock and (ii) warrants exercisable for an aggregate of 2,142,858 shares of Class A common stock ("Securities Purchase Agreement Warrants") to the Investors.

Each share of Class A common stock and accompanying Securities Purchase Agreement Warrant to purchase one share of Class A common stock was sold at an offering price of $14.00.

The aggregate gross proceeds to the Company from the Offering totaled $30.0 million before deducting the placement agent’s fees and related offering expenses.

The aggregate gross proceeds to us from the Offering totaled $30.0 million before deducting the placement agent’s fees and related offering expenses.

The Securities Purchase Agreement Warrants had an exercise price equal to $14.50 per share of Class A common stock, were exercisable for a term beginning on March 25, 2024 and expired on July 3, 2024 with no warrants exercised.

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We agreed to pay a cash fee equal to 4% of the gross exercise price paid in cash with respect to the exercise of the Securities Purchase Agreement Warrants.

Our ability to continue as a going concern for the next 12 months from the date of reissuance of these consolidated financial statements is dependent upon our ability to obtain sufficient cash to meet our obligations, including the repayment of all amounts owed pursuant to the Blue Torch Financing Agreement (as amended, and as defined below), which is scheduled to mature on June 13, 2026.

We have failed to meet our leverage ratio and minimum liquidity financial covenants and SEC periodic filing requirement non-financial covenant under the Blue Torch Financing Agreement, and therefore Blue Torch has

the right to accelerate and declare all or any portion of the loans outstanding under the Blue Torch Financing Agreement to be due and payable.

Further, upon the filing of this Form 10-K/A, we will fail to comply with the non-financial covenant requiring us to have a report or opinion of our auditor without an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern.

Based on our current cash and cash equivalents and investment in marketable securities balances and expected future financial results, if the Transactions (as defined below) do not close, we will not have sufficient liquidity to continue operations for at least the next twelve months from the reissuance of the accompanying consolidated financial statements.

Furthermore, we will not have sufficient cash to repay the balance of the loans outstanding under the Blue Torch Financing Agreement in the event Blue Torch declares all or any portion of the loan to be due and payable.

We entered into a Share Purchase Agreement (the “Purchase Agreement”) with Kpler Holding SA, a Belgian corporation (“Buyer”), pursuant to which we agreed to sell our maritime business to Buyer and enter into certain ancillary agreements (the “Transactions”).

Our ability to continue as a going concern for the next 12 months from the date of issuance of these consolidated financial statements is dependent upon our ability to obtain sufficient cash to meet our obligations, including the repayment of all amounts owed pursuant to the Blue Torch Financing Agreement (as amended, and as defined below), which is scheduled to mature on June 13, 2026.

Based on our current cash and cash equivalents and expected future financial results, if the Transactions do not close, we will not have sufficient liquidity to continue operations for at least the next twelve months from the issuance of the accompanying consolidated financial statements.

We entered into the Purchase Agreement with Buyer, pursuant to which we agreed to complete the Transactions.

The maritime business to be sold pursuant to the Transactions does not include any part of our satellite network or operations.

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Notwithstanding our notice to Buyer to that effect, Buyer has failed to consummate the closing.

Buyer has cited various reasons for declining to close, which we have rejected.

Buyer has cited various reasons for declining to close, including a review of the Transactions by the UK Competition and Markets Authority.

We have rejected these reasons.

We believe that Buyer’s failure to close is not consistent with the terms of the Purchase Agreement, which do not give Buyer the option to delay closing once all closing conditions have been met.

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Kpler removed the matter to the District of Delaware, pursuant to a contract term in the Purchase Agreement promising not to contest removal to that court.

Buyer removed the matter to the District of Delaware, pursuant to a contract term in the Purchase Agreement promising not to contest removal to that court.

The District of Delaware initially selected a March 4 trial date, but on February 26, 2025, the court set a trial date of May 28-30, 2025.

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However, as described above, there is currently no assurance that the Transactions will close or when the Transactions may close.

Given the expected delay in the closing of the Transactions, we intend to seek additional equity or debt financing (including securities convertible or exchangeable for equity) and may seek waivers of or amendments to contractual obligations, delay, limit, reduce, or terminate certain commercial efforts, or pursue merger, disposition or other strategies, any of which could adversely affect our business, results of operations, and financial condition.

Given the delay in the closing of the Transactions, on March 14, 2025, we closed the 2024 Private Placement of Class A common stock and Pre-Funded Warrants for gross proceeds of $40.0 million, before deducting offering expenses.

We may seek additional equity or debt financing (including securities convertible or exchangeable for equity) and may seek waivers of or amendments to contractual obligations, delay, limit, reduce, or terminate certain commercial efforts, or pursue merger, disposition or other strategies, any of which could adversely affect our business, results of operations, and financial condition.

There is no assurance that we will be successful in achieving any of the foregoing.

Due to our projected cash needs, including amounts owed pursuant to the Blue Torch Financing Agreement and our breach of our covenants under the Blue Torch Financing Agreement, there is substantial doubt about our ability to continue as a going concern for a period of at least 12 months from the date of reissuance of the accompanying consolidated financial statements.

Due to our projected cash needs, including amounts owed pursuant to the Blue Torch Financing Agreement, there is substantial doubt about our ability to continue as a going concern for a period of at least 12 months from the date of issuance of the accompanying consolidated financial statements.

The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Blue Torch Credit Agreement

On June 13, 2022, we, as borrower, and certain of our subsidiaries, as guarantors, entered into a financing agreement (the “Blue Torch Financing Agreement”) with Blue Torch Finance LLC, a Delaware limited liability company (“Blue Torch”), as administrative agent and collateral agent, and certain lenders (the “Lenders”).

On June 13, 2022, we, as borrower, and certain of our subsidiaries, as guarantors, entered into a financing agreement (the “Blue Torch Financing Agreement”) with Blue Torch, as administrative agent and collateral agent, and certain lenders (the “Lenders”).

The Blue Torch Financing Agreement provides for, among other things, a term loan facility in an aggregate principal amount of up to $120.0 million (the “Blue Torch Credit Facility”).

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The Blue Torch Credit Facility is scheduled to mature on June 13, 2026, upon which we must repay the outstanding principal amount of any outstanding loans thereunder, together with all accrued but unpaid interest, fees, and other obligations owing under the Blue Torch Credit Facility.

Subject to certain exceptions, prepayments of the Blue Torch Credit Facility will be subject to early termination fees in an amount equal to 3.0% of the principal prepaid if prepayment occurs on or prior to the first anniversary of the closing date, 2.0% of principal prepaid if prepayment occurs after the first anniversary of the closing date but on or prior to the second anniversary of the closing date and 1.0% of principal prepaid if prepayment occurs after the second anniversary of the closing date but on or prior to the third anniversary of the closing date, plus if prepayment occurs on or prior to the first anniversary of the closing date, a make-whole amount equal to the amount of interest that would have otherwise been payable through the maturity date of the Blue Torch Credit Facility.

Subject to certain exceptions, prepayments of the Blue Torch Credit Facility were subject

to early termination fees in an amount equal to 3.0% of the principal prepaid if prepayment would have occurred on or prior to the first anniversary of the closing date, 2.0% of principal prepaid if prepayment would have occurred after the first anniversary of the closing date but on or prior to the second anniversary of the closing date and, 1.0% of principal prepaid if prepayment occurs after the second anniversary of the closing date but on or prior to the third anniversary of the closing date, plus if prepayment would have occurred on or prior to the first anniversary of the closing date, a make-whole amount equal to the amount of interest that would have otherwise been payable through the maturity date of the Blue Torch Credit Facility.

The $120.0 million term loan was available and drawn at closing, of which $19.7 million was placed in an escrow account by Blue Torch with such amount to be released upon our achieving certain metrics related to annualized recurring revenue and a total annualized recurring revenue leverage ratio.

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Such obligations, including the guarantees, are secured by substantially all of our personal property and that of our subsidiary guarantors, including pursuant to a Security Agreement entered into on June 13, 2022 among us, Spire Global Subsidiary, Inc., Austin Satellite Design, LLC and Blue Torch.

As of the closing date, such subsidiary guarantors were Spire Global Subsidiary, Inc., Austin Satellite Design, LLC, Spire Global Canada Subsidiary Corp.

and exactEarth Ltd.

As of the closing date, such subsidiary guarantors were Spire Global Subsidiary, Inc., Austin Satellite Design, LLC, Spire Global Canada Subsidiary Corp., and exactEarth Ltd.

The Blue Torch Financing Agreement contains customary affirmative and negative covenants limiting our ability and the ability of our subsidiaries to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, repurchase stock, and make investments, in each case subject to certain exceptions.

We must also comply with a maximum debt to annualized recurring revenue leverage ratio financial covenant tested monthly during the first two years of the Blue Torch Financing Agreement, a maximum debt to EBITDA leverage ratio financial covenant tested monthly during the third and fourth years of the Blue Torch Financing Agreement and a minimum liquidity financial covenant tested at all times.

As of December 31, 2023, we were in compliance with all applicable financial covenants under the Blue Torch Financing Agreement.

As of December 31, 2024, we were not in compliance with all applicable financial covenants under the Blue Torch Financing Agreement.

The Blue Torch Financing Agreement also contains customary events of default that include, among other things, certain payment defaults, cross defaults to other indebtedness, inaccuracy of representations and warranties, covenant defaults, change of control defaults, judgment defaults, and bankruptcy and insolvency defaults.

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Under certain circumstances, a default interest rate will apply on all obligations during the existence of an event of default under the Blue Torch Financing Agreement at a per annum rate equal to 2.00% above the applicable interest rate.

A default interest rate of 16.61448% was applied on our outstanding obligations from November 1, 2024 to March 11, 2025.

On June 13, 2022, in connection with the Blue Torch Financing Agreement, we issued warrants to affiliates of the Lenders to purchase shares of Class A common stock (the “2022 Blue Torch Warrants”), which were exercisable for an aggregate of 437,024 shares of our Class A common stock with a per share exercise price of $16.08.

In addition, on June 13, 2022, in connection with the closing of the financing, we paid Urgent Capital LLC, a Delaware limited liability company, a fee for introducing us to the Lenders, for the purpose of loan financing, in the amount equal to $0.6 million in cash and a warrant to purchase shares of Class A common stock (the “GPO Warrant” and, collectively with the 2022 Blue Torch Warrants and the 2023 Blue Torch Warrants (as defined below), the “Credit Agreement Warrants”), which is exercisable for an aggregate of 24,834 shares of our Class A common stock with a per share exercise price of $16.08.

On September 27, 2023, we entered into the Waiver and Amendment No.

2 to Financing Agreement (the “Waiver and Amendment”) with Blue Torch and the Lenders, which amends the Blue Torch Financing Agreement to (a) waive an event of default under the Blue Torch Financing Agreement arising out of the total annualized recurring revenue leverage ratio being greater than the permitted ratio, (b) amend the financial covenants to provide covenant relief from the maximum debt to annualized recurring revenue leverage ratio and the maximum debt to EBITDA leverage ratio set forth in the Blue Torch Financing Agreement for future periods, and (c) provide for a second amendment exit fee.

The second amendment exit fee is $1.8 million (which is an amount equal to one and a half percent (1.50%) of the aggregate outstanding principal balance of the term loans on the effective date of the Waiver and Amendment), bears interest from the date of the Waiver and Amendment at the Adjusted Term SOFR for a 3-month interest period plus the applicable margin under the Financing Agreement, and is payable to Blue Torch by us in cash upon the termination of the Blue Torch Financing Agreement, either as a result of

acceleration of the loans or at the final maturity date.

greater than the permitted ratio, (b) amend the financial covenants to provide covenant relief from the maximum debt to annualized recurring revenue leverage ratio and the maximum debt to EBITDA leverage ratio set forth in the Blue Torch Financing Agreement for future periods, and (c) provide for a second amendment exit fee.

The second amendment exit fee is $1.8 million (which is an amount equal to one and a half percent (1.50%) of the aggregate outstanding principal balance of the term loans on the effective date of the Waiver and Amendment), bears interest from the date of the Waiver and Amendment at Adjusted Term SOFR for a 3-month interest period plus the applicable margin under the Financing Agreement, and is payable to Blue Torch by us in cash upon the termination of the Blue Torch Financing Agreement, either as a result of acceleration of the loans or at the final maturity date.

The Waiver and Amendment required a repayment by the Company of $2.5 million of the outstanding principal balance of the term loans on October 2, 2023, with a prepayment premium of $0.05 million.

The Waiver and Amendment also requires additional reporting if our liquidity level is less than $35.0 million at any time during a month and revises the minimum liquidity covenant to require liquidity of at least $30.0 million at all times, commencing on September 30, 2023 which in both cases represent a $5.0 million incremental change from the original requirements.

We were in compliance with all applicable financial covenants as of December 31, 2023.

On June 13, 2022, in connection with the Blue Torch Financing Agreement, we issued warrants to affiliates of the Lenders to purchase shares of Class A common stock (the “2022 Blue Torch Warrants”), which were exercisable for an aggregate of 437,025 shares of our Class A common stock with a per share exercise price of $16.08.

On September 27, 2023, in connection with the Waiver and Amendment, we and certain affiliates of Blue Torch amended and restated the 2022 Blue Torch Warrants to reduce the per share exercise price from $16.08 to $5.44.

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The number of shares for which the Credit Agreement Warrants are exercisable and the associated exercise price are subject to certain proportional adjustments as set forth in the Credit Agreement Warrants.

On December 29, 2023, we pre-paid $2.0 million on our outstanding balance to maintain compliance with the maximum debt to annualized recurring revenue leverage ratio financial covenant, which otherwise would have been short by $2.0 million as of December 31, 2023 due to the delay in the award of the $9.4 million radio occultation sales order by NOAA.

As of December 31, 2023, the outstanding principal balance under the Blue Torch Credit Facility was $115.5 million.

FP Credit Agreement

On April 15, 2021, we entered into a credit agreement with FP Credit Partners, L.P., as agent for several lenders (the “FP Lenders”) (as amended on May 17, 2021, the “FP Credit Agreement”), for a $70.0 million term loan facility (the “FP Term Loan”).

Upon funding in May 2021, the FP Term Loan was used (i) to pay off our existing credit facilities with Eastward Fund Management, LLC and European Investment Bank and (ii) to fund working capital and for general corporate purposes.

We incurred $12.3 million of debt issuance costs relating to the FP Term Loan.

The FP Lenders were also entitled to a commitment fee of $1.75 million that was fully earned and paid upon signing the FP Credit Agreement.

At the time of repayment, the FP Term Loan bore interest at a rate of 9.00% per annum.

Prior to the Merger, the FP Term Loan bore interest at a rate of 8.50% per annum.

Since the FP Lenders elected to exercise their conversion right in connection with the Merger, and we chose not to prepay the remaining, non-converted outstanding principal amount of the FP Term Loan at the closing of such transaction, our interest rate under the FP Term Loan increased to 9.0% per annum.

Interest on the FP Term Loan was payable quarterly in arrears.

The total outstanding principal amount of the FP Term Loan was due and payable at maturity on April 15, 2026.

We had the right to prepay the outstanding principal amount of the FP Term Loan at any time, in full but not in part.

In addition, since the FP Lenders elected to exercise their conversion right in connection with the Merger, there was no premium or other contractual return in a prepayment.

The aggregate amount required to be repaid in a prepayment to the FP Lenders would only have been the outstanding principal amount of the FP Term Loan and any accrued and unpaid interest thereon.

Our obligations under the FP Credit Agreement were guaranteed by our material subsidiaries, as determined in accordance with the FP Credit Agreement, and secured by substantially all of our assets and the assets of the subsidiary guarantors.

The FP Credit Agreement contained customary affirmative and negative covenants, including covenants that limited our ability and our subsidiaries’ ability to, among other things, incur additional indebtedness, grant liens, make investments, pay dividends or other distributions on our capital stock, dispose of assets, consummate mergers or acquisitions and enter into transactions with affiliates, subject in each case to customary exceptions and qualifications.

Prior to the consummation of a Qualifying IPO (as defined in the FP Credit Agreement), which included the Merger, we were required to maintain, as of the last day of each fiscal quarter, minimum unrestricted cash of at least $15.0 million, as determined in accordance with the FP Credit Agreement, provided that this covenant did not apply following any fiscal quarter in which we achieved positive EBITDA so long as we continued to maintain positive EBITDA in subsequent fiscal quarters.

After the Merger occurred, we were no longer required to maintain this financial covenant per the terms of the FP Credit Agreement.

The FP Credit Agreement included customary events of default, including, among other things, payment defaults, breaches of covenants or representations and warranties, cross-defaults with certain other indebtedness, bankruptcy and insolvency events and judgment defaults, subject to grace periods in certain instances.

Upon the occurrence and during the continuance of an event of default, the FP Lenders could declare all or a portion of the outstanding obligations payable by us to be immediately due and payable, and exercise other rights and remedies provided for under the FP Credit Agreement.

Under certain circumstances, a default interest rate would apply on all obligations during the existence of an event of default under the FP Credit Agreement at a per annum rate equal to 2% above the otherwise applicable interest rate.

On June 13, 2022, we repaid in full all obligations and all amounts borrowed, and all obligations have terminated, under the FP Credit Agreement, which was replaced by the Blue Torch Financing Agreement.

The outstanding principal and interest under the FP Credit Agreement in an aggregate amount equal to approximately $72.8 million was repaid with proceeds of the term loan under the Blue Torch Credit Facility.

We incurred no early termination penalties in connection with the termination of the FP Credit Agreement.

On April 8, 2024, we entered into Amendment No.

3 to Financing Agreement (the “Third Amendment”) with Blue Torch and the Lenders, which amends the Blue Torch Financing Agreement to (i) increase the maximum debt to EBITDA leverage ratio for the monthly periods ending June 30, 2024, July 31, 2024, and August 31, 2024, and to decrease the maximum permitted ratio thereafter, and (ii) amend the minimum liquidity covenant to require liquidity of at least $20.0 million at all times, commencing on April 8, 2024, which represents a $10.0 million decrease from the requirement in effect immediately prior to the effective date of the Third Amendment.

On April 8, 2024, in accordance with the terms of the Third Amendment, we made a repayment to Blue Torch of $10.0 million in principal, plus an early termination fee of $0.2 million.

On August 27, 2024, we entered into the Waiver and Amendment No.

4 to Financing Agreement (the “Fourth Amendment”) with Blue Torch and the Lenders, which amends the Blue Torch Financing Agreement to (i) waive events of default under the Blue Torch Financing Agreement arising out of the maximum debt to EBITDA leverage ratio being greater than the ratio permitted by the Blue Torch Financing Agreement and the failure to deliver the financial statements for the fiscal quarter ended June 30, 2024 required by the Blue Torch Financing Agreement, (ii) amend the financial covenants in the Blue Torch Financing Agreement to provide immediate covenant relief from the leverage ratios set forth in the Blue Torch Financing Agreement and extend the duration of the annualized recurring revenue (ARR) leverage ratio through December 31, 2024, and (iii) provide for a fourth amendment fee.

The fourth amendment fee is in an amount equal to three and a half percent (3.50%) of the aggregate outstanding principal balance of the term loans on the effective date of the Fourth Amendment, bears interest from the date of the Fourth Amendment at Adjusted Term SOFR for a 3-month interest period plus the applicable margin under the Blue Torch Financing Agreement, and shall be paid-in-kind and added to the principal balance of the term loans.

On August 27, 2024, in accordance with the terms of the Fourth Amendment, we made a prepayment to Blue Torch of $10.0 million in principal, plus an early termination fee of $0.1 million.

On November 11, 2024, we and Blue Torch entered into a forbearance agreement (the “Forbearance Agreement”), pursuant to which each of the lenders party to the Blue Torch Financing Agreement agreed not to exercise their default-related rights and remedies with respect to certain events of default related to the failure to deliver quarterly financial information as of and for the periods ended June 30, 2024 that was required to be provided to the lenders by October 31, 2024, the leverage ratio being greater than required as of June 30, 2024 and our anticipated failure to file the financial statements for the fiscal quarter ended September 30, 2024 with the SEC by November 15, 2024 (collectively, the “Specified Defaults”), until the earliest to occur of (A) the occurrence of any other event of default other than the Specified Defaults, (B) the date on which Blue Torch delivered a

notice terminating the forbearance period, which notice could have been delivered at any time upon or after the occurrence of an additional event of default or any breach of the Forbearance Agreement or (C) 11:59 p.m.

Eastern Time on December 24, 2024.

On March 12, 2025, we and Blue Torch entered into the Fifth Amendment to, among other things, (a) waive events of default under the Blue Torch Financing Agreement arising out of the maximum debt to EBITDA leverage ratio being greater than the ratio permitted by the Blue Torch Financing Agreement, the failure to deliver financial projections for the 2025 fiscal year and liquidity being lower than permitted by the Blue Torch Financing Agreement, (b) amend the financial covenants in the Blue Torch Financing Agreement to replace the maximum debt to EBITDA ratio with a minimum EBITDA covenant and provide relief on the recurring revenue leverage ratio set forth in the Blue Torch Financing Agreement, (c) amend the Blue Torch Financing Agreement to permit us to obtain subordinate financing secured by related liens on such junior indebtedness, (d) increase the applicable margin by 2.50% in the form of PIK interest which will be fully earned, paid-in-kind and added to the principal balance of the term loans, and (e) provide for a fifth amendment fee and extension fees.

The fifth amendment fee is equal to $2.5 million which will be paid in kind by adding such fee to the principal amount after which it bears interest from the date of the Fifth Amendment at the Adjusted Term SOFR for a 3-month interest period plus the applicable margin under the Blue Torch Financing Agreement.

If the Blue Torch Financing Agreement is not terminated and all obligations are paid in full on or before April 30, 2025, the extension fee will be added to the principal balance of the term loans on such date, and an additional extension fee in an equal amount will be added to the principal balance of the term loans on each date that is 30 days after April 30, 2025 until the Blue Torch Financing Agreement is terminated and all obligations are paid in full.

The Fifth Amendment also requires us to engage a liquidity management advisor reasonably satisfactory to Blue Torch no later than March 21, 2025, and we did so on March 21, 2025.

Government Loan

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As of December 31, 2024, approximately $76.8 million of shares were remaining, but had not yet been sold, under the Equity Distribution Agreement.

Cash Flows (As Restated)

The following table summarizes our net cash used in operating activities, net cash used in investing activities, and net cash provided by financing activities for the periods indicated:

Years Ended December 31,

Year Ended December 31,

(in thousands)

(As Restated)

Net cash used in operating activities

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Net cash provided by financing activities

Cash Flows from Operating Activities (As Restated)

Cash Flows from Operating Activities

Our largest source of operating cash inflows is cash collections from our customers.

Our primary uses of cash from operating activities are for employee-related expenditures, expenses related to our technology infrastructure, expenses related to our computing infrastructure (including computing power, database storage and content delivery costs), building infrastructure costs (including leases for office space), fees for third-party services, and marketing program costs.

Net cash used in operating activities in was $36.3 million for the year ended December 31, 2023.

Our primary uses of cash from operating activities are for employee-related expenditures, expenses related to our technology infrastructure, expenses related to our

computing infrastructure (including computing power, database storage and content delivery costs), building infrastructure costs (including leases for office space), fees for third-party services, and marketing program costs.

Net cash used in operating activities was $18.5 million for the year ended December 31, 2024.

This reflected our net loss of $102.8 million, adjustments for non-cash items of $63.1 million and a net decrease of $21.2 million in net operating assets.

Non-cash items primarily consisted of $18.2 million of depreciation and amortization expense, $13.0 million of stock-based compensation expense, $2.9 million of amortization of operating lease right-of-use assets, $2.3 million of debt issuance amortization costs, $1.6 million change in fair value of warrant liabilities, and a $1.0 million loss on decommissioned satellites and impairment of assets, partially offset by $0.5 million of other, net, and a $0.1 million change in fair value of contingent earnout liability.

Changes in operating assets and liabilities primarily included a $13.7 million increase in contract liabilities, a $4.1 million decrease in accounts receivable, net, a $1.7 million decrease in other long-term assets, and a $1.4 million increase in accounts payable, partially offset by a $9.8 million increase in other current assets, a $2.8 million decrease in operating lease liabilities, a $2.7 million decrease in accrued wages and benefits, a $1.6 million increase in contract assets, and a $1.1 million decrease in other accrued expenses.

Non-cash items primarily consisted of $21.7 million of depreciation and amortization expense, $19.4 million of stock-based compensation expense, $5.3 million change in fair value of warrant liabilities, $4.8 million of amortization of operating lease right-of-use assets, $4.5 million of debt issuance amortization costs, a $4.0 million loss on decommissioned satellites and disposal of assets, $2.4 million related to issuance of stock warrants, and a $1.2 million change in fair value of contingent earnout liability, partially offset by $0.3 million of other, net.

Changes in operating assets and liabilities primarily included a $12.4 million decrease in other current assets, a $7.1 million increase in other accrued expenses, a $3.1 million decrease in contract assets, a $2.7 million increase in contract liabilities, a $2.6 million increase in accounts payable, a $2.0 million decrease in other long-term assets, and a $0.9 million increase in accrued wages and benefits, partially offset by a $5.0 million increase in accounts receivable, net, and a $4.7 million decrease in operating lease liabilities.

Net cash used in operating activities was $36.3 million for the year ended December 31, 2023.

This reflected our net loss of $77.6 million, adjustments for non-cash items of $38.5 million and a net decrease of $2.8 million in net operating assets.

Non-cash items primarily consisted of a $22.3 million loss on extinguishment of debt, $18.3 million of depreciation and amortization expense, $11.5 million of stock-based compensation expense, $3.8 million of debt issuance amortization costs, $2.3 million of amortization of operating lease assets, and a $0.8 million loss on impairment of assets, partially offset by a $9.7 million gain on change in fair value of contingent earnout liability, and an $8.8 million gain on change in fair value of warrant liabilities.

Changes in operating assets and liabilities primarily included a $16.6 million increase in contract liabilities, a $2.5 million decrease in other current assets, a $1.9 million decrease in other long-term assets, and a $1.1 million increase in other accrued expenses.

partially offset by a $4.2 million increase in accounts receivable, net, a $1.8 million decrease in accounts payable, a $1.6 million decrease in operating lease liabilities, a $0.9 million decrease in accrued wages and benefits, and a $0.7 million increase in contract assets.

Cash Flows from Investing Activities (As Restated)

Non-cash items primarily consisted of $18.2 million of depreciation and amortization expense, $13.0 million of stock-based compensation expense, $2.9 million of amortization of operating lease right-of-use assets, $2.3 million of debt issuance amortization costs, $1.6 million change in fair value of warrant liabilities, and a $1.0 million loss on decommissioned satellites and disposal of assets, partially offset by $0.5 million of other, net, and a $0.1 million change in fair value of contingent earnout liability.

Cash Flows from Investing Activities

Cash flows from investing activities primarily relate to cash used for business acquisitions, the procurement, development, and deployment of capital assets, including satellites and related launch costs, ground stations, machinery and equipment, furniture, computer equipment and software, and leasehold improvements.

The following table summarizes our net cash used in investing activities relating to capital expenditures by source of spend:

(dollars in thousands)

Spire platform / Infrastructure

Customer funded (Space Services)

Year Ended December 31,

(dollars in thousands)

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Customer funded (Space Services)

Year-over-Year Variance

Q1'23 v Q1'22

Q2'23 v Q2'22

Q3'23 v Q3'22

Q4'23 v Q4'22

Spire platform / Infrastructure

Customer funded (Space Services)

Net cash used in investing activities was $14.2 million for the year ended December 31, 2024.

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Net cash provided by financing activities was $19.0 million for the year ended December 31, 2024.

The net cash provided by financing activities was driven by $19.9 million of proceeds from long-term debt, $7.9 million of proceeds from issuance of common stock, and $0.7 million of proceeds from the employee stock purchase plan, partially offset by $4.5 million of long-term debt repayments, and $0.1 million of payments of debt issuance costs.

The net cash provided by financing activities was driven by proceeds from the securities purchase agreements with Signal Ocean Ltd.

and certain institutional investors of $37.9 million, proceeds from our employee stock purchase plan of $0.9 million, and proceeds from exercise of stock options of $0.3 million, partially offset by payments on long-term debt of $20.1 million.

Net cash provided by financing activities was $23.9 million for the year ended December 31, 2023.

The net cash provided by financing activities was driven by $101.0 million of proceeds from long-term debt, $0.8 million of proceeds from stock option exercises and $0.6 million of proceeds from the employee stock purchase plan, partially offset by $71.5 million of payments on long-term debt, and $4.5 million of payments of debt issuance costs.

The long-term debt and debt issuance cost items were driven by the Blue Torch loan transaction.

For additional information regarding the terms of our credit facilities and notes, see Note 7 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

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Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations.

Revenue Recognition (As Restated)

Revenue Recognition

Our contracts with customers may include promises to transfer multiple solutions and services to a customer.

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For certain project-based performance obligations, primarily our R&D Services Contracts, we recognize revenue over time using the percentage-of-completion method, using an input measure, specifically the cost incurred to date over the total expected cost of the contract.

We have determined this method to be the most direct and reasonable measure of progress as it reflects the

results achieved and value transferred to the customer.

We have determined this method to be the most direct and reasonable measure of progress as it reflects the results achieved and value transferred to the customer.

We recognize revenue for other contracts over time, such as data subscriptions and the data delivery for Space Services Contracts.

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These factors are also considered in determining the useful life of the acquired intangible assets.

These estimates are based in part on historical experience, market conditions and information obtained from management of the acquired companies and are inherently uncertain.

These estimates are based in part on historical experience, market conditions and information obtained from management of the acquired

companies and are inherently uncertain.

Goodwill represents the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recorded.

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Accounting Pronouncements Recently Adopted and Not Yet Adopted

See Note 3 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K/A for recently adopted accounting pronouncements and new accounting pronouncements not yet adopted as of the date of this Annual Report on Form 10-K/A.

See Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for recently adopted accounting pronouncements and new accounting pronouncements not yet adopted as of the date of this Annual Report on Form 10-K.

Emerging Growth Company Status

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Smaller Reporting Company Status

Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K.

We are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K.

Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.

1 unchanged sentence

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/A

Item 7. Management’s Discussion and Analysis