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10-K – 2026-03-02 – asts-20251231.htm
Master Equipment Financing Agreement, dated as of June 27, 2025, among AST & Science, LLC, AST & Science Texas LLC, AST SpaceMobile Manufacturing, LLC, Trinity Capital, Inc., as administrative agent, collateral agent and lender, and the other lenders from time to time party thereto (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the SEC on July 3, 2025). 10.41 Amendment To Strategic Collaboration and Spectrum Usage Agreement (incorporated by reference to Exhibit 10.3 to the registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 11, 2025). 10.42 AST SpaceMobile, Inc. 2024 Incentive Award Plan – Form of Restricted Stock Award Agreement (incorporated by reference to Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 11, 2025). 10.43 Framework Agreement, dated as of March 22, 2025, by and between Ligado Networks LLC, AST SpaceMobile, Inc., AST & Sciences, LLC and Spectrum USA I, LLC (incorporated by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the SEC on March 24, 2025). 10.44 Strategic Collaboration and Spectrum Usage Agreement, dated as of March 22, 2025, by and between Ligado Networks LLC and AST & Sciences, LLC (incorporated by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed with the SEC on March 24, 2025). 10.45 Spectrum Usage Rights Agreement, dated as of March 22, 2025, by and between One Dot Six LLC and AST & Sciences, LLC (incorporated by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed with the SEC on March 24, 2025). 10.46 Side Letter Agreement, dated as of March 22, 2025, by and between AST SpaceMobile, Inc., Cerberus Capital Management, L.P. and Fortress Credit Advisors LLC (incorporated by reference to Exhibit 10.4 to the registrant’s Current Report on Form 8-K filed with the SEC on March 24, 2025). 10.47 Pre-Funded Warrant, dated as of March 22, 2025 (incorporated by reference to Exhibit 10.5 to the registrant’s Current Report on Form 8-K filed with the SEC on March 24, 2025). 19.1 AST SpaceMobile, Inc. Insider Trading Compliance Policy (incorporated by reference to Exhibit 19.1 to the registrant’s Annual Report on Form 10-K filed with the SEC on March 3, 2025). 21.1* List of subsidiaries of AST SpaceMobile, Inc 23.1* Consent of Independent Registered Public Accounting Firm (KPMG LLP). 67 24.1 Power of Attorney (included in signature page). 31.1* Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certification of Chief Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1* Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2* Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97.1 AST SpaceMobile, Inc. Policy for the Recovery of Erroneously Awarded Incentive-Based Compensation (incorporated by reference to Exhibit 97.1 to the registrant’s Annual Report on Form 10-K filed with the SEC on April 1, 2024). 101.INS Inline XBRL Instance Document. 101.SCH Inline XBRL Taxonomy Extension Schema with Embedded Linkbases Document. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) Management contract or compensatory plan or arrangement * Filed herewith 68 INDEX T O CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (KPMG LLP, Miami, FL, Auditor Firm ID: 185 ) 70 Consolidated Balance Sheets as of December 31, 2025 and 2024 72 Consolidated Statements of Operations for the Years ended December 31, 2025, 2024 and 2023 73 Consolidated Statements of Comprehensive Income (Loss) for the Years ended December 31, 2025, 2024 and 2023 74 Consolidated Statements of Stockholders’ Equity for the Years ended December 31, 2025, 2024 and 2023 75 Consolidated Statements of Cash Flows for the Years ended December 31, 2025, 2024 and 2023 76 Notes to Consolidated Financial Statements 77 69 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors AST SpaceMobile, Inc.: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of AST SpaceMobile, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 2, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Remeasurement of the liability for private placement warrants As discussed in Notes 2, 3 and 8 to the consolidated financial statements, the Company has issued private placement warrants to purchase common stock at a price of $11.50 per share. The private placement warrants are exercisable on a cashless basis and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees. The private placement warrants are accounted for as derivative liabilities on the consolidated balance sheet at fair value, with subsequent changes in fair value recognized in the consolidated statement of operations at each reporting date. The Company estimates the fair value of the liability for outstanding unexercised private placement warrants at each financial reporting date using the Black-Scholes-Merton model. The Black-Scholes-Merton model required the use of a risk-free rate assumption and expected volatility assumption, which are subjective assumption inputs. The risk-free rate assumption was based on U.S. Treasury rates, and the expected volatility assumption was based on an average of the historical volatility of the Company’s shares and the implied volatility of one-year options on the Company’s shares. During the year ended December 31, 2025, 2,931,125 private placement warrants were exercised on a cashless basis and there were 122,000 private placement warrants that remain outstanding as of December 31, 2025. For the year ended December 31, 2025, the Company recognized a net loss of $68.2 million for changes in fair value of these private placement warrants. 70 We identified the evaluation of the loss recognized on the remeasurement of the fair value of the liability for private placement warrants prior to their exercise as a critical audit matter. A high degree of auditor judgment and specialized skills and knowledge were required in the evaluation of the estimated fair value prior to the exercise of the private placement warrants due to the degree of subjectivity associated with the expected volatility assumption and its sensitivity to variation. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s valuation process for the private placement warrants, including a control related to the determination of the expected volatility assumption. We involved valuation professionals with specialized skills and knowledge who assisted in: • developing an independent expectation of the volatility assumption based on consideration of historical and implied share price volatility information • developing an estimate of the fair value of the liability for private placement warrants prior to their exercise using publicly available market data and the independently developed volatility assumption • comparing the independently developed estimate of the fair value to the respective fair value of the liability for private placement warrants determined by the Company. /s/ KPMG LLP We have served as the Company’s auditor since 2021. Miami, Florida March 2, 2026 71 AST SPACEMOBILE, INC. CONSOLIDATED BALANCE SH EETS (Dollars in thousands, except share data) As of December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 2,335,683 $ 564,988 Restricted cash 877 2,546 Accounts receivable, net (includes related party accounts receivable of $ 2,091 and $ 0 at December 31, 2025 and 2024, respectively) 37,726 1,400 Inventory 12,007 1,062 Prepaid expenses 11,955 7,887 Other current assets 60,264 22,363 Total current assets 2,458,512 600,246 Non-current assets: Restricted cash 443,400 - Property and equipment, net 1,398,761 337,669 Intangible assets, net 245,093 - Operating lease right-of-use assets, net 19,420 14,014 Other non-current assets (includes related party loan receivable of $ 18,187 and $ 0 at December 31, 2025 and 2024, respectively) 449,201 2,632 TOTAL ASSETS $ 5,014,387 $ 954,561 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 46,763 $ 17,004 Accrued expenses and other current liabilities 69,246 12,195 Current contract liabilities 19,887 41,968 Current operating lease liabilities 2,449 1,856 Current portion of long-term debt 11,999 2,919 Total current liabilities 150,344 75,942 Non-current liabilities: Warrant liabilities 7,471 41,248 Non-current operating lease liabilities 17,479 12,652 Non-current contract liabilities 207,093 - Long-term debt, net 2,207,583 155,573 Other non-current liabilities 32,092 - Total liabilities 2,622,062 285,415 Commitments and contingencies (Note 9) Stockholders' Equity: Class A Common Stock, $ .0001 par value, 800,000,000 shares authorized, 285,449,911 and 208,173,198 shares issued and outstanding as of December 31, 2025 and 2024, respectively 27 20 Class B Common Stock, $ .0001 par value, 200,000,000 shares authorized, 11,227,292 shares issued and outstanding as of December 31, 2025 and 2024, respectively 4 4 Class C Common Stock, $ .0001 par value, 125,000,000 shares authorized, 78,163,078 shares issued and outstanding as of December 31, 2025 and 2024, respectively 8 8 Additional paid-in capital 2,671,770 969,004 Accumulated other comprehensive income (loss) 1,351 ( 176 ) Accumulated deficit ( 831,685 ) ( 489,745 ) Noncontrolling interest 550,850 190,031 Total stockholders' equity 2,392,325 669,146 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 5,014,387 $ 954,561 See accompanying notes to the consolidated financial statements 72 AST SPACEMOBILE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except share and per share data) Year Ended December 31, 2025 2024 2023 Revenues: Products revenues (includes related party revenues of $ 2,091 , $ 0 and $ 0 for the years ended December 31, 2025, 2024 and 2023 respectively) $ 44,389 $ 500 $ - Services revenues 26,529 3,918 - Total revenues 70,918 4,418 - Operating expenses: Cost of revenues (exclusive of items shown separately below) Cost of revenues - products (includes related party cost of revenues of $ 1,329 , $ 0 and $ 0 for the years ended December 31, 2025, 2024 and 2023, respectively) 33,032 - - Cost of revenues - services 2,184 - - Engineering services costs 142,510 93,491 78,811 General and administrative costs 101,679 61,566 41,601 Research and development costs 28,115 28,783 47,486 Depreciation and amortization 51,111 63,340 54,469 Total operating expenses 358,631 247,180 222,367 Other (expense) income: (Loss) gain on remeasurement of warrant liabilities ( 68,154 ) ( 268,627 ) 8,986 Interest expense ( 36,071 ) ( 18,681 ) ( 4,511 ) Interest income (includes related party interest income of $ 564 , $ 0 and $ 0 for the years ended December 31, 2025, 2024 and 2023, respectively) 49,233 14,164 7,186 Other (expense) income, net ( 114,408 ) 1,867 ( 10,290 ) Loss on extinguishment of debt - ( 10,963 ) - Total other (expense) income, net ( 169,400 ) ( 282,240 ) 1,371 Loss before income tax expense ( 457,113 ) ( 525,002 ) ( 220,996 ) Income tax expense ( 3,898 ) ( 1,328 ) ( 1,681 ) Net loss before allocation to noncontrolling interest ( 461,011 ) ( 526,330 ) ( 222,677 ) Net loss attributable to noncontrolling interest ( 119,071 ) ( 226,247 ) ( 135,116 ) Net loss attributable to common stockholders $ ( 341,940 ) $ ( 300,083 ) $ ( 87,561 ) Net loss per share attributable to holders of Class A Common Stock Basic and diluted $ ( 1.34 ) $ ( 1.94 ) $ ( 1.07 ) Weighted-average number of shares Basic and diluted 255,982,592 154,501,344 81,824,122 See accompanying notes to the consolidated financial statements 73 AST SPACEMOBILE, INC. CONSOLIDATED STATEMENTS OF COMPREHEN SIVE INCOME (LOSS) (Dollars in thousands) Year Ended December 31, 2025 2024 2023 Net loss before allocation to noncontrolling interest $ ( 461,011 ) $ ( 526,330 ) $ ( 222,677 ) Other comprehensive income (loss) Foreign currency translation adjustments 2,049 ( 586 ) ( 6 ) Total other comprehensive income (loss) 2,049 ( 586 ) ( 6 ) Total comprehensive loss before allocation to noncontrolling interest ( 458,962 ) ( 526,916 ) ( 222,683 ) Comprehensive loss attributable to noncontrolling interest ( 118,549 ) ( 226,430 ) ( 135,120 ) Comprehensive loss attributable to common stockholders $ ( 340,413 ) $ ( 300,486 ) $ ( 87,563 ) See accompanying notes to the consolidated financial statements 74 AST SPACEMOBILE, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Dollars in thousands, except share data) Year Ended December 31, 2025 Class A Common Stock Class B Common Stock Class C Common Stock Additional Accumulated Other Shares Values Shares Values Shares Values Paid-in Capital Comprehensive Income (Loss) Accumulated Deficit Noncontrolling Interest Total Equity Balance, December 31, 2024 208,173,198 $ 20 11,227,292 $ 4 78,163,078 $ 8 $ 969,004 $ ( 176 ) $ ( 489,745 ) $ 190,031 $ 669,146 Stock-based compensation - - - - - - 47,173 - - 317 47,490 Issuance of common stock, net of issuance costs 26,651,988 2 - - - - 974,313 - - 297,289 1,271,604 Issuance of equity under employee stock plan 1,226,686 - - - - - 6,336 - - 5,472 11,808 Issuance of equity to acquire spectrum priority rights and pay spectrum usage fees 963,385 - - - - - 23,760 - - 6,321 30,081 Vesting of restricted stock units 1,389,318 - - - - - ( 15,884 ) - - ( 7,134 ) ( 23,018 ) Issuance of penny warrants - - - - - - 89,197 - - 31,959 121,156 Capped call, net - - - - - - ( 15,666 ) - - ( 8,390 ) ( 24,056 ) 2034 Convertible Notes settlement 25,818,541 3 - - - - 115,601 - - 24,016 139,620 2032 4.25 % Convertible Notes settlement 17,274,752 2 - - - - 394,180 - - 111,344 505,526 Warrant exercise 2,294,380 - - - - - 78,875 - - 23,055 101,930 Redemption of AST LLC Common Units for Class A common stock 1,657,663 - - - - - 4,881 - - ( 4,881 ) - Foreign currency translation adjustments - - - - - - - 1,527 - 522 2,049 Net loss - - - - - - - - ( 341,940 ) ( 119,071 ) ( 461,011 ) Balance, December 31, 2025 285,449,911 $ 27 11,227,292 $ 4 78,163,078 $ 8 $ 2,671,770 $ 1,351 $ ( 831,685 ) $ 550,850 $ 2,392,325 Year Ended December 31, 2024 Class A Common Stock Class B Common Stock Class C Common Stock Additional Accumulated Other Shares Values Shares Values Shares Values Paid-in Capital Comprehensive Income (Loss) Accumulated Deficit Noncontrolling Interest Total Equity Balance, December 31, 2023 90,161,309 $ 9 50,041,757 $ 5 78,163,078 $ 8 $ 288,404 $ 227 $ ( 189,662 ) $ 114,568 $ 213,559 Stock-based compensation - - - - - - 26,680 - - 5,359 32,039 Issuance of common stock, net of issuance costs 62,052,687 6 - - - - 351,846 - - 187,944 539,796 Issuance of equity under employee stock plan 462,224 - - - - - 2,776 - - 2,165 4,941 Vesting of restricted stock units 1,532,573 - - - - - ( 4,204 ) - - ( 997 ) ( 5,201 ) Warrant exercise 13,971,450 1 - - - - 242,570 - - 168,357 410,928 Redemption of AST LLC Common Units for Class A common stock 39,992,955 4 ( 38,814,465 ) ( 1 ) - - 60,932 - - ( 60,935 ) - Foreign currency translation adjustments - - - - - - - ( 403 ) - ( 183 ) ( 586 ) Net loss - - - - - - - - ( 300,083 ) ( 226,247 ) ( 526,330 ) Balance, December 31, 2024 208,173,198 $ 20 11,227,292 $ 4 78,163,078 $ 8 $ 969,004 $ ( 176 ) $ ( 489,745 ) $ 190,031 $ 669,146 Year Ended December 31, 2023 Class A Common Stock Class B Common Stock Class C Common Stock Additional Accumulated Other Shares Values Shares Values Shares Values Paid-in Capital Comprehensive Income (Loss) Accumulated Deficit Noncontrolling Interest Total Equity Balance, December 31, 2022 71,819,926 $ 7 50,041,757 $ 5 78,163,078 $ 8 $ 235,384 $ 229 $ ( 102,101 ) $ 226,294 $ 359,826 Stock-based compensation - - - - - - 12,631 - - 658 13,289 Issuance of common stock, net of issuance costs 14,027,909 1 - - - - 36,892 - - 26,874 63,767 Issuance of equity under employee stock plan 3,639,645 1 - - - - 3,699 - - ( 3,475 ) 225 Vesting of restricted stock units 673,829 - - - - - ( 202 ) - - ( 663 ) ( 865 ) Foreign currency translation adjustments - - - - - - - ( 2 ) - ( 4 ) ( 6 ) Net loss - - - - - - - - ( 87,561 ) ( 135,116 ) ( 222,677 ) Balance, December 31, 2023 90,161,309 $ 9 50,041,757 $ 5 78,163,078 $ 8 $ 288,404 $ 227 $ ( 189,662 ) $ 114,568 $ 213,559 See accompanying notes to the consolidated financial statements 75 AST SPACEMOBILE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) Years Ended December 31, 2025 2024 2023 Cash flows from operating activities: Net loss before allocation to noncontrolling interest $ ( 461,011 ) $ ( 526,330 ) $ ( 222,677 ) Adjustments to reconcile net loss before noncontrolling interest to cash used in operating activities: Depreciation and amortization 51,111 63,340 54,469 Amortization of debt issuance costs 2,728 3,734 1,155 Amortization of debt commitment fee 4,033 - - Write off of unamortized debt issuance costs - 5,483 - Loss on disposal/sale of property and equipment 4,605 2,221 110 Induced conversion expense on convertible notes 99,681 - - Loss (gain) on remeasurement of warrant liabilities 68,154 268,627 ( 8,986 ) Stock-based compensation 47,490 32,039 13,289 Non-cash interest expense 1,361 2,959 - Non-cash interest income ( 564 ) - - Loss from equity method investment 1,205 - - Changes in operating assets and liabilities: Accounts receivable ( 36,326 ) 380 ( 1,780 ) Prepaid expenses and other current assets ( 27,622 ) ( 13,334 ) 13,862 Inventory ( 10,945 ) ( 1,062 ) - Accounts payable and accrued expenses 32,251 ( 6,257 ) ( 149 ) Contract liabilities 161,516 41,968 - Other assets and liabilities ( 9,184 ) 89 1,765 Net cash used in operating activities ( 71,517 ) ( 126,143 ) ( 148,942 ) Cash flows from investing activities: Purchase of property and equipment ( 1,064,741 ) ( 174,127 ) ( 118,807 ) Capital advances to Ligado ( 420,000 ) - - Purchase of spectrum intangibles ( 56,397 ) - - Net cash used in investing activities ( 1,541,138 ) ( 174,127 ) ( 118,807 ) Cash flows from financing activities: Proceeds from debt 2,611,523 145,000 63,500 Repayments of debt ( 5,120 ) ( 48,752 ) ( 242 ) Payment for debt issuance costs ( 11,588 ) ( 9,435 ) ( 9,653 ) Proceeds from issuance of common stock 1,295,894 551,947 64,639 Payments for third party equity issuance costs ( 24,320 ) ( 12,151 ) ( 872 ) Proceeds from warrant exercises - 153,618 - Issuance of equity under employee stock plan 11,808 4,941 225 Employee taxes paid for stock-based compensation awards ( 23,018 ) ( 5,201 ) ( 865 ) Purchase of capped call transactions ( 98,578 ) - - Proceeds from capped call sales 74,522 - - Payments for debt commitment fee ( 11,000 ) - - Proceeds from share issuances to repurchase 2032 4.25% Convertible Notes 1,010,887 - - Payments for repurchase of 2032 4.25% Convertible Notes ( 1,003,522 ) - - Net cash provided by financing activities 3,827,488 779,967 116,732 Effect of exchange rate changes on cash, cash equivalents and restricted cash ( 2,407 ) ( 260 ) ( 142 ) Net increase (decrease) in cash, cash equivalents and restricted cash 2,212,426 479,437 ( 151,159 ) Cash, cash equivalents and restricted cash beginning of period 567,534 88,097 239,256 Cash, cash equivalents and restricted cash end of period $ 2,779,960 $ 567,534 $ 88,097 Supplemental disclosure of cash flow information: Non-cash activities: Right-of-use assets obtained in exchange for operating lease liabilities $ 7,231 $ 2,238 $ 6,739 Non-cash investing and financing activities: Purchases of property and equipment in accounts payable and accrued expenses $ 56,708 $ 9,309 $ 18,409 PIK interest paid through issuance of PIK notes 497 2,959 - Deferred asset acquisition costs paid by issuance of penny warrants 121,156 - - Spectrum intangibles acquisition costs accrued or paid by issuance of shares 67,540 - - 2034 Convertible Notes settled by issuance of Class A Common Stock 139,620 - - Settlement of warrant liabilities by issuing shares 101,930 257,337 - Acquisition of equity investment in and loan receivable from SatCo by contributing exclusive distribution rights 23,497 - - Cash paid during the fiscal year for: Interest $ 7,855 $ 11,988 $ 3,243 Income taxes, net 6,798 1,669 492 See accompanying notes to the consolidated financial statements 76 AST SPACEMOBILE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2025 1. Organization and Nature of Operations AST SpaceMobile, Inc., collectively with its subsidiaries (“SpaceMobile” or the “Company”) is currently designing, developing and manufacturing the constellation of BlueBird (“BB”) satellites and has begun launching its planned space-based Cellular Broadband network distributed through a constellation of low Earth orbit (“LEO”) satellites. Once deployed and operational, the BB satellites are designed to provide connectivity directly to off-the-shelf and unmodified devices at broadband speeds (the “SpaceMobile Service”), and be accessible for other applications for government use. At that point, the Company intends to offer the SpaceMobile Service to cellular subscribers and others through wholesale commercial agreements with cellular service providers. The Company also intends to leverage its patented technology, including large phased array and high power capability of its BB satellites, for a variety of applications in the government sector. The Company is headquartered in Texas where it operates satellite assembly, integrating and testing (“AIT”) facilities. The Company also has engineering and development centers elsewhere in the United States, India and Scotland, and engineering, development and production centers in Spain and Israel. The Company’s global footprint was approximately 450,000 square feet as of December 31, 2025. The Company’s intellectual property (“IP”) portfolio is diverse, containing numerous and various innovations of the direct-to-cell satellite ecosystem from space to Earth. The Company’s IP portfolio consists of 38 patent families worldwide. As of December 31, 2025, the Company has appr oximately 3,850 patent and patent pending claims worldwide, of which approximately 1,900 have been officially granted or allowed. The Company launched its BlueWalker 3 (“BW3”) test satellite on September 10, 2022, and announced the completion of the deployment of the communication phased array antenna of the BW3 test satellite in orbit on November 14, 2022. Using the BW3 test satellite, the Company successfully completed two-way 5G voice calls directly to standard unmodified smartphones, achieved repeated successful download speeds of above 21 megabits per second (“Mbps”) to standard unmodified smartphones and spectral efficiency of approximately 3 bits per second per hertz. The Company has also successfully completed initial in-orbit and ground testing for non-communication government applications. The Company intends to continue testing capabilities of the BW3 test satellite, including further testing with cellular service providers and the government. The Company launched five first generation commercial BB satellites (“Block 1 BB satellites”) on September 12, 2024. The Block 1 BB satellites are of similar size and weight to the BW3 test satellite and have ten times higher throughput than the BW3 test satellite. In October 2024, the Company completed the deployment of the phased array antennas and Q/V antennas in orbit and performed a series of monitoring tests and activities to confirm the successful initial operations of the Block 1 BB satellites. In January 2025, the Company successfully made the first SpaceMobile video call from space with Vodafone using standard unmodified 4G/5G smartphones. In February 2025, the Company completed the voice and video calls tests on standard unmodified smartphones with AT&T and Verizon in the U.S. and also completed the tests for non-communication applications for the United States government. All five Block 1 BB satellites have participated in the tests at various stages. In April 2025, together with Rakuten Mobile, Inc., the Company successfully conducted a two-way broadband video call in front of a live audience using unmodified smartphones on the SpaceMobile network enabled by a Block 1 BB satellite in orbit today. On July 21, 2025, the Company and AT&T made the first-ever Voice over LTE (“VoLTE”) call and short message service over satellite using AT&T’s spectrum and core network with a standard unmodified cell phone. On October 2, 2025, together with Bell Canada, the Company achieved Canada’s first-ever space-based 4G VoLTE voice call, broadband data connection, and video streaming using everyday smartphones. The Company has deployed and released many fixed cells over the continental U.S. to its Mobile Network Operators (“MNOs”) and Original Equipment Manufacturer partners as the reference cells for routing testing. The Company continues to test the spectrum quality of those fixed cells and have received approval to activate fixed cells from an MNO. The Company expects to continue testing for SpaceMobile Service automation including beta testing prior to rollout of initial noncontinuous SpaceMobile Service in select markets including the United States, Europe, and Japan. The Company launched the first (“BB6”) of its next generation commercial BB satellites (“Block 2 BB satellites”) on December 23, 2025. The Block 2 BB satellites feature an up to approximately 2,400 square feet phased array, the largest phased array ever deployed in a LEO for commercial use, which is more than three times larger than the phased array of the Block 1 BB satellites and designed to deliver up to 10 times the bandwidth capacity of the Block 1 BB satellites. On February 10, 2026, the Company successfully deployed BB6, the largest phased array deployed commercially in LEO. The performance of BB6 is driven by several breakthroughs in space-based architecture. The large antenna array allows the satellite to transmit and receive signals from standard handheld devices. Further, the large aperture enables highly precise beamforming, creating narrower, more focused coverage areas. This precision minimizes interference, maximizes network capacity and provides a consistent high-quality user experience for Cellular Broadband services, including voice, data and video. 77 The Company is organized in an “Up-C” structure in which the business is operated by AST & Science, LLC (“ AST LLC”) and its subsidiaries and in which the Company's only direct assets consist of equity interests in AST LLC. As the managing member of AST LLC, the Company has full discretion to manage and control the business of AST LLC and to take all action it deems necessary to accomplish the purposes of AST LLC. The Company’s Class A Common Stock is listed on the Nasdaq Capital Market under the symbol “ASTS”. 2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements and related notes have been prepared by the Company in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and the requirements of the Securities and Exchange Commission (“SEC”). The consolidated financial statements include the accounts of the Company, AST LLC and its subsidiaries. Intercompany transactions and balances have been eliminated upon consolidation. Certain comparative amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. As the Company is the sole managing member of AST LLC and has full, exclusive and complete discretion to manage and control the business of AST LLC and to take all actions it deems necessary, appropriate, advisable, incidental, or convenient to accomplish the purposes of AST LLC, the financial statements of AST LLC and its subsidiaries have been prepared on a consolidated basis with the Company. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The Company bases its estimates and assumptions on historical experience when available and on other market-specific or other relevant assumptions that it believes to be reasonable under the circumstances. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, useful lives assigned to property and equipment, the fair values of warrant liabilities, potential impairment of long-lived assets and indefinite-lived intangibles , and equity-based compensation expense. The Company assesses estimates on an ongoing basis; however, actual results could materially differ from those estimates due to risks and uncertainties, including the continued uncertainty surrounding rapidly changing market and economic conditions due to geopolitical conflicts and macroeconomic conditions including changes in inflation and interest rates. Related Parties and Related Party Transactions A related party is a person who has the ability to exert significant influence over the Company and may include executive officers and directors, including members of their immediate families, shareholders owning more than 10% of the Company’s voting securities, or other entities deemed to be affiliates, as defined in Accounting Standards Codification (“ASC”) 850, Related Party Disclosures (“ASC 850”). The Company assesses its related parties and applicable disclosures on a quarterly basis, considering all relevant facts and circumstances. According to the Company’s Stockholders’ Agreement, as amended, certain investors of the Company have the right to nominate directors to the Company’s Board of Directors. These investors include AT&T, Vodafone, American Tower and Antares Technologies. However, none of these investors have ownership rights or any voting rights that qualify them as related parties under ASC 850. Therefore, the Company has concluded that none of these investors with board representation are related parties as of December 31, 2025, and no disclosures under ASC 850 are required for these investors. On July 7, 2025, the Company and Vodafone entered into an agreement to create a jointly-owned European satellite service business (“SatCo”). As an equity method investee, SatCo is a related party of the Company under ASC 850. S ee Note 16 Vodafone Joint Venture for further details. Foreign Currency Translation and Transaction Gains and Losses The financial statements of the Company’s foreign subsidiaries are translated from local currency into reporting currency, which is U.S. dollars, using the current exchange rate at the balance sheet date for assets and liabilities, and the weighted average exchange rate prevailing during the period for revenues and expenses. The functional currency of the Company’s foreign subsidiaries is the local currency for each entity and, accordingly, translation adjustments for these subsidiaries are included in accumulated other comprehensive income (loss) wi thin stockholders’ equity. Realized and unrealized gains and losses resulting from foreign currency transactions denominated in currencies other than the functional currency are reflected as other (expense) income, net in the consolidated statements of operations. 78 Segment Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is its Chairman and Chief Executive Officer . The Company has determined that it operates in one operating segment, as the CODM reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. Consolidated net loss before allocation to noncontrolling interest is the reported measure of segment profit or loss and is the primary measure used by the CODM to assess segment performance and decide how to allocate resources. This measure is used to monitor operating results, compare actual performance to internal budgets and forecasts, evaluate performance relative to strategic objectives, and determine the level of operating and capital resources required. Consolidated net loss before allocation to noncontrolling interest is presented in the consolidated statements of operations as revenues less total operating expenses and other segment items. Other segment items include loss and gain on remeasurement of warrant liabilities, interest income and expense, and income taxes expense. Other segment items also include induced conversion expense related to the repurchases of the 2032 4.25 % Convertible Notes, loss on extinguishment of debt, and a charge for penalty paid in accordance with a contractual agreement for the years ended December 31, 2025, 2024 and 2023, respectively. The measure of segment assets is reported on the accompanying consolidated balance sheets as total assets. Cash and Cash Equivalents The Company’s cash equivalents consist of short-term money market funds. The Company considers all highly liquid investments with a maturity date of 90 days or less at the date of purchase to be cash equivalents. Cash is primarily maintained at Federal Deposit Insurance Corporation (“FDIC”) insured financial institutions. The Company maintains its cash in accounts at financial institutions that the Company believes are of high credit quality. At times, the cash balance may exceed federally insured limits. The Company's foreign subsidiaries may deposit cash at institutions that are not insured by the FDIC. Interest income earned on cash and cash equivalents and restricted cash is reported under interest income in the consolidated statement of operations. Cash and cash equivalents and restricted cash as of December 31, 2025 are subject to minimal credit risk. Restricted Cash Restricted cash represents cash held in escrow and deposit accounts. These funds are restricted as to withdrawal or use under the terms of the contractual agreements. Property and Equipment Property and equipment are carried at cost less accumulated depreciation. The cost of self-constructed BB satellite assets consists of direct materials, direct labor, launch costs, and other direct costs attributable to bringing the asset to a working condition and desired location for the intended use. Costs incurred, including direct materials purchased, launch payments made, direct labor costs and overheads such as launch insurance and satellite transportation costs to the launch site, until the completion of the construction and launch of the BB satellites are reported as satellite materials, satellites under construction, and advance launch payments within construction-in-progress. Once launched in orbit, the costs of the BB satellites are reported as satellites in orbit and depreciation of the satellites commences once the BB satellites are ready for their intended use. To date, the Company has capitalized five Block 1 BB satellites which are reported as part of satellites in orbit within property and equipment. The Block 1 BB satellites were reclassified from Construction in progress to Satellites in orbit as of October 29, 2024, the date they were determined to be ready for their intended use, and are depreciated over their expected remaining useful lives of approximately 60 months. The Company capitalizes the costs of the test satellites if there is an alternative future use for the test satellites. The Company capitalizes only those expenditures and ancillary costs that are directly attributable to assembly and testing and necessarily incurred to place the test satellites into their intended location and use. These costs include materials costs, launch cost, and other non-recurring costs directly associated with the development of the test satellites. The other non-recurring costs primarily include third-party vendors who are hired solely for the design, assembly, and testing of the test satellite and are responsible for the value and progression of the project. The costs for internal recurring engineering employees and consultants are expensed as engineering services costs and not capitalized to the cost of the test satellites, as these employees are not directly associated with the development of the test satellites. To date, the Company has capitalized one test satellite, BW3, which is reported as part of satellites in orbit within property and equipment. BW3 test satellite was capitalized in 2023 and has been fully depreciated in August 2024. The Company capitalizes the costs of software obtained for internal use in accordance with the guidance for accounting for costs of computer software obtained for internal use. Capitalization of software obtained for internal use commences during the development phase of the project and ends when the asset is ready for its intended use. Software obtained for internal use is generally 79 amortized on a straight-line basis over the estimated useful life and included within property and equipment on the Company’s consolidated balance sheet. Capitalized costs of software obtained for internal use for the years ended December 31, 2025, 2024 and 2023 were $ 17.5 million, $ 13.5 million and $ 7.0 million, respectively, all of which were developed by third parties to the Company. Amortization of capitalized internal use software for the years ended December 31, 2025 and 2024 was approximately $ 1.4 million and $ 1.1 million, respectively. No amortization was recognized for the year ended December 31, 2023. The Company records depreciation in a manner that recognizes the cost of its depreciable assets over their estimated useful lives primarily using the straight-line method. Leasehold improvements are amortized over the shorter of the terms of the underlying leases or the estimated useful lives of the improvements. Repairs and maintenance costs that do not extend the useful life or enhance the productive capacity of an asset are expensed as incurred. Upon retirement or disposal of property and equipment, the Company derecognizes the cost and accumulated depreciation balance associated with the asset, with a resulting gain or loss from disposal included in the determination of net income or loss. The Company depreciates the assets over the estimated useful lives as follows: Estimated Useful Life Building and building improvements 10 to 30 years Computers, software, and equipment 2 to 10 years Leasehold improvements Shorter of estimated useful life or lease term Satellite antennas 5 years Satellites in orbit 2 to 7 years Lab, assembly, and integration equipment 2 to 10 years Others (1) 5 to 7 years (1) Includes vehicles, furniture and fixtures, and a phased array test facility. Cloud Computing Software Implementation Costs Cloud computing software implementation costs incurred in hosting arrangements are capitalized and reported as a component of Other current assets and Other non-current assets in the Company’s consolidated balance sheets. Once available for their intended use, these costs are amortized on a straight-line basis over their respective contract service periods, including periods covered by any reasonably probable options to extend, ranging from three to five years. As of December 31, 2025 and 2024, capitalized costs, net of accumulated amortization, totaled $ 2.9 million and $ 0.7 million, respectively. For the years ended December 31, 2025, 2024 and 2023, amortization expense associated with hosting arrangements was $ 0.4 million, $ 0.8 million and $ 0.2 million, respectively, and recognized within General and administrative costs in the consolidated statements of operations. Impairment of Long Lived Assets Long-lived assets consist of property and equipment and operating lease right-of-use assets. Long-lived assets are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the asset may not be fully recoverable. The Company continually evaluates whether events or circumstances have occurred that indicate that the estimated remaining useful life of long-lived assets may warrant revision or if events or circumstances indicate that the carrying value of these assets may be impaired. To compute whether assets have been impaired, the estimated undiscounted future cash flows for the estimated remaining useful life of the assets are compared to the carrying value. To the extent that the future cash flows are less than the carrying value, the assets are written down to the estimated fair value of the asset. There were no impairment charges for long-lived assets recognized for the years ended December 31, 2025, 2024 and 2023 . Warrant Liabilities The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”). Management’s assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether they meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own Common Stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period-end date while the warrants are outstanding. 80 Issued or modified warrants that meet all of the criteria for equity classification are recorded as a component of additional paid-in capital at the time of issuance. Issued or modified warrants that do not meet all the criteria for equity classification are recorded as a liability at their initial fair value on the date of issuance and subject to remeasurement each balance sheet date with changes in the estimated fair value of the warrants to be recognized as an unrealized gain or loss in the consolidated statements of operations. Fair Value Measurements The Company measures certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting. The fair value of the financial instruments is not necessarily representative of the amount that could be realized or settled, nor does the fair value amount consider the tax consequences of realization or settlement. In assessing the fair value of financial instruments, the Company uses a variety of methods and assumptions, which are based on estimates of market conditions and risks existing at the time. The Company uses the following valuation techniques to measure fair value for its assets and liabilities: • Level 1: Quoted prices in active markets for identical assets and liabilities. • Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs. • Level 3: Unobservable inputs based on the Company's assessment of the assumptions that market participants would use in pricing the asset or liability. Revenue Recognition Revenue generated from sales of goods and services is recognized when a customer obtains control of promised goods or services in accordance with ASC 606, Revenue from Contracts with Customers . During the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 44.4 million , $ 0.5 million and $ 0 million of Products revenue from the sale of gateway equipment and related software to MNOs. These arrangements typically involve multiple performance obligations, which include hardware, software, and optional installation and support services. Revenue for hardware and software sales is recognized at a point in time when control transfers to the customer, which is generally upon delivery of the equipment and activation of the software. Revenue for installation and support services is generally recognized as services are performed. During the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 26.5 million , $ 3.9 million, and $ 0 million of Services revenue mainly from performance obligations completed under agreements with the U.S. Government to date either directly as a prime contractor or indirectly through prime contractors. Under these arrangements, the Company has provided testing and other development services designed to enable future service capabilities. These contracts typically contain a single performance obligation and include a series of fixed-price milestones for which the Company has the right to invoice upon completion and customer acceptance. The Company recognizes revenue from these contracts over time when milestones are achieved and accepted by the customer, which reflects the pattern by which the Company satisfies its performance obligation through the transfer of service to the customer. Additionally, the Company has definitive commercial agreements with MNOs to provide SpaceMobile Service. These arrangements contain multiple performance obligations, including sale of gateway equipment hardware and software and a stand ready obligation to provide SpaceMobile Service. Revenue for SpaceMobile Service will be recognized over the life of the contract, beginning when AST provides MNOs access to its satellite network. To date, the Company has not recognized any revenues from its SpaceMobile Service. The Company defers revenue and recognizes contract liabilities in the event the performance obligations are not satisfied for which payment has been received. As of December 31, 2025 and December 31, 2024, $ 227.0 million and $ 42.0 million, respectively, of current and non-current contract liabilities were recorded for advance consideration received from customers for which the associated performance obligations were not yet satisfied. The significant increase in contract liabilities during the year ended December 31, 2025 was primarily due to advance payments received from MNOs related to the provision of SpaceMobile Service. The amount of revenue recognized for the year ended December 31, 2025 that was included in the December 31, 2024 contract liability balance was approximately $ 6.4 million. Revenue allocated to remaining performance obligations, which includes contract liabilities and amounts that will be invoiced and recognized as revenue in future periods, was approximately $ 1.2 billion as of December 31, 2025. The Company expects to recognize approximately 9.0 % of its remaining performance obligations as revenue over the next 12 months and the remainder 81 thereafter. The Company’s contracts with MNOs to provide SpaceMobile Service contain multiple performance obligations. Revenue allocated to remaining SpaceMobile Service performance obligations does not include variable consideration that has not been included in the transaction price, specifically consideration from revenue sharing with MNOs based on revenue generated from end customers’ usage of the satellite services. That consideration is constrained due to the uncertainty about the amount of the consideration to be received, which may not be resolved for a period of time. Intangible Assets The Company’s intangible assets consist of the spectrum usage rights of up to 45 MHz of lower mid-band satellite spectrum in the United States and Canada for direct-to-device satellite applications and certain S-Band International Telecommunication Union (“ITU”) priority rights to Mobile Satellite Services frequencies in the range of 1980-2010 MHz and 2170-2200 MHz, for use in LEO. The Company capitalizes spectrum payments, regulatory filing and other direct costs incurred to ready the spectrum usage rights for their intended use as an intangible asset. The Company will commence amortization of the spectrum usage rights once applicable regulatory approvals are received and the asset is considered ready for its intended use. The Company determined that the S-Band ITU priority rights is an indefinite-lived intangible asset as there are currently no legal, regulatory, contractual, competitive, economic or other factors that limit the useful life of its priority rights. The Company will re-evaluate the useful life determination each year to determine whether events and circumstances continue to support an indefinite useful life. The Company tests its definite and indefinite-lived intangible assets for potential impairment annually or more frequently if impairment indicators are present. The Company has the option to first perform a qualitative assessment to determine whether it is necessary to perform a quantitative impairment test. However, the Company may elect to bypass the qualitative assessment in any period and proceed directly to performing the quantitative impairment test. See Note 14 Spectrum Usage Rights and Related Financing and Note 15 Global S-Band Spectrum Priority Rights Acquisition for further details. Accounts Receivable and Allowance for Credit Losses Accounts receivable are reported net of an allowance for credit losses that are not expected to be recovered. The Company recognizes the allowance for credit losses at inception of sales and reassesses quarterly based on management’s expectation of the asset’s collectability. The allowance is based on multiple factors including historical experience with bad debts, the credit quality of the customer base, the aging of such receivables and current macroeconomic conditions. The Company elected the practical expe dient, available as part of the early adoption of ASU 2025-05 (see below), not to consider management’s expectations of conditions in the future for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606. The Company’s contractual payment terms with its customers average between 60 to 90 days. As of December 31, 2025, the majority of outstanding accounts receivable are considered current. For the years ended December 31, 2025 and 2024, the Company’s customers had high credit ratings and the allowance for credit losses was immaterial. Inventory Inventory consists of gateway equipment held for sale and is stated at the lower of cost or net realizable value. Cost is determined using the weighted-average cost method and includes the average purchase price of equipment acquired, inbound freight, and other direct costs necessary to prepare the equipment for sale. Net realizable value represents the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. The Company periodically reviews inventory on hand and records provisions for excess, slow-moving, or obsolete inventory based on historical usage, expected demand, and technological obsolescence among other factors. Inventory write-downs are recorded as a component of cost of revenues and are not subsequently reversed. Engineering Services Costs Engineering services costs are charged to expense as incu rred. Engineering services costs consist primarily of the cost of employees and consultants involved in designing and developing the BB satellites, managing the network and satellite operations centers, and indirectly supporting the assembly, integration and testing of the BB satellites, license cost, and general expenses related to AIT facilities and engineering development centers. General and Administrative Costs General and administrative costs primarily consist of compensation and related expenses for non-engineering personnel, office and facilities expenses, and professional services, including legal fees, accounting, and public relations. These costs also include insurance, software licensing and subscriptions. 82 Research and Development Costs Research and development costs are charged to expense as incurred. Research and development costs consist principally of development activities in which the Company typically engages third-party vendors for the design and development of the electronic componentry, software, and mechanical deployment systems and materials and supplies consumed in the development activities. Stock-Based Compensation The Company accounts for equity awards, including grants of stock options, restricted stock and restricted stock units, in accordance with ASC 718, Compensation – Stock Compensation (“ASC 718”). ASC 718 requires all equity-based payments to employees, which includes grants of employee equity awards, to be recognized in the consolidated statements of operations based on their grant date fair values. The Company issues stock-based compensation awards to the employees, non-employees, and non-employee members of the Board of Directors. The Company accounts for stock-based compensation for awards granted to non-employees in a similar fashion to the way it accounts for stock-based compensation awards to employees. The Company estimates the grant date fair value of stock options granted to employees, non-employees, and non-employee members of the Board of Directors using the Black-Scholes option-pricing model. Use of the Black-Scholes model requires the Company to make assumptions with respect to the expected term of stock options, the expected volatility of the Common Stock consistent with the expected life of the option, risk-free interest rates and expected dividend yields of the Common Stock. The fair value of restricted stock and restricted stock units granted to employees, non-employees and non-employee members of the Board of Directors is based on the fair value of the Company’s stock on the grant date. For awards that vest based solely on achievement of a service condition, the Company recognizes expense on a straight-line basis over the period during which the award holder provides such services. For awards that vest based on both service and performance conditions, the Company recognizes expense using a graded method for such awards only to the extent it believes achievement of the performance conditions is probable. The Company recognizes forfeitures as they occur and reverses any previously recognized compensation cost associated with forfeited awards. The Company accounts for the compensation associated with equity awards by offsetting expense with additional paid-in capital. The Company’s less than wholly owned subsidiary, AST LLC, has issued stock-based compensation awards to its employees, non-employees, and non-employee members of the Board of Directors. The exercise of these awards decreases the Company’s ownership interest in AST LLC. The Company accounts for the compensation associated with these awards similarly to the awards described above; however, the offset to the expense is recorded to noncontrolling interest rather than additional paid-in capital. Income Taxes The Company follows the asset and liability method of accounting for income taxes under ASC 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. In assessing the realizability of deferred tax assets, management considered whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. ASC 740 prescribes a recognition threshold and a measurement attribute for the recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not (i.e., a likelihood of more than 50%) to be sustained upon examination by taxing authorities. A recognized tax position is then measured at the largest amount of benefit with greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes accrued interest and penalties related to uncertain tax positions as income tax expense. Th ere were no uncertain tax positions and no amounts accrued for interest and penalties as of December 31, 2025 and 2024. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. Noncontrolling Interests The noncontrolling interests primarily represent the equity interest in AST LLC held by members other than the Company. Changes in the Company’s ownership interest in AST LLC while retaining control of AST LLC are accounted for as equity transactions. 83 Income or loss is attributed to the noncontrolling interests based on their contractual distribution rights, and the relative percentages of equity interest held by the Company and the other members during the period. Net Loss per Share The Company reports both basic and diluted net loss per share. Basic net loss per share is calculated based on the weighted average number of shares of Common Stock outstanding and excludes the dilutive effect of warrants, stock options, and other types of convertible securities. Diluted net loss per share is calculated based on the weighted average number of shares of Common Stock outstanding and the dilutive effect of stock options, warrants and other types of convertible securities is included in the calculation. Dilutive securities are excluded from the diluted net loss per share calculation in periods where the Company reports a net loss as such dilutive securities have an anti-dilutive effect on net loss per share. Recently Adopted and Issued Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-04, Induced Conversions of Convertible Debt Instruments, which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. This ASU is effective for fiscal years beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. The Company early adopted the new standard, effective January 1, 2025, on a prospective basis, and the accounting requirements of this ASU have been reflected in the Company’s accounting for the repurchase of a portion of the 2032 4.25 % Convertible Notes in the consolidated financial statements. In July 2025, FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”), which amends ASC 326-20, Financial Instruments – Credit Losses – Measured at Amortized Cost to introduce a practical expedient that permits entities to assume that current conditions as of the balance sheet date do not change for the remaining life of current accounts receivable and/or current contract assets arising from transactions accounted for under ASC 606. The standard is effective for annual periods beginning after December 15, 2025, including interim periods within those annual periods. The Company early adopted the new standard, effective January 1, 2025, on a prospective basis, and the accounting requirements of this ASU have been reflected in the Company’s evaluation of allowance for accounts receivable in the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires a public business entity (PBE) to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further broken out by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state/local, and foreign and by jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. The Company adopted the ASU for annual periods beginning January 1, 2025 and the adoption did not have a material impact on the Company’s consolidated financial statements. Future Adoption of Recently Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) : Disaggregation of Income Statement Expenses, which is intended to improve the disclosures of expenses by providing more detailed information about the types of expenses in commonly presented expense captions. The standard is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The standard can be applied either prospectively or retrospectively. The Company is currently evaluating the impact of adopting this ASU on the presentation of its consolidated financial statements. In September 2025, FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”). ASU 2025-06 modernizes the accounting for internal-use software costs by eliminating the prescriptive "project stage" model and introducing a principles-based framework that is intended to better reflect current software development practices. The amendment is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating the potential impacts of adopting this ASU on its consolidated financial statements. All other new accounting pronouncements issued, but not yet effective or adopted, have been deemed to be not relevant to the Company and, accordingly, are not expected to have a material impact once adopted. 84 3. Fair Value Measurement The Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows (in thousands): As of December 31, 2025 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 2,016,705 $ - $ - Total assets measured at fair value $ 2,016,705 $ - $ - Liabilities: Private placement warrant liability - - 7,471 Total liabilities measured at fair value $ - $ - $ 7,471 As of December 31, 2024 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 510,424 $ - $ - Total assets measured at fair value $ 510,424 $ - $ - Liabilities: Private placement warrant liability - - 41,248 Total liabilities measured at fair value $ - $ - $ 41,248 As of December 31, 2025 and December 31, 2024, the Company had $ 2.8 billion and $ 567.5 million of cash and cash equivalents and restricted cash, respectively, of which $ 2.0 billion and $ 510.4 million , respectively, were classified as cash equivalents, which consisted principally of short-term money market funds with original maturities of 90 days or less. As of December 31, 2025, non-current restricted cash of $ 443.4 million consisted of the cash collateral for the UBS Bridge Financing Loan and $ 15.0 million collateral for the capital equipment loan with Prosperity Bank, and current restricted cash of $ 0.9 million consisted of deposits against the bank guaranty issued to the landlords for lease of properties. As of December 31, 2024, restricted cash of $ 2.5 million consisted of a deposit into an interest reserve escrow account for the terminated senior secured credit facility and a deposit against the bank guaranty issued to the landlord for lease of a property. For certain instruments, including cash, accounts payable, and accrued expenses, it was estimated that the carrying amount approximated fair value because of the short maturities of these instruments. As of December 31, 2025 and December 31, 2024, warrant liabilities were comprised of private placement warrants (“Private Placement Warrants”), which have been classified as Level 3 due to the use of historical volatility of the Company’s shares and implied volatility derived from options on the Company’s shares. Warrant liabilities are described in detail in Note 8 Warrant Liabilities. The Private Placement Warrants are valued using a Black-Scholes-Merton model. The Company’s Black-Scholes-Merton model to value Private Placement Warrants required the use of the following subjective assumption inputs: • As of December 31, 2025 , the risk-free rate assumption was based on the three-month and one-year U.S. Treasury rates as the estimated time to expiration was 0.26 years (compared to being based on the one- and two-year U.S. Treasury rates based on an estimated time to expiration of 1 .26 years as of December 31, 2024 ). An increase in the risk-free interest rate, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa. • As of December 31, 2025 and December 31, 2024 , the expected volatility assumption was based on an average of the historical volatility of the Company’s shares and the implied volatility of one-year options on the Company’s shares, which was 105.3 % and 112.7 % , respectively. 85 4. Property and Equipment Property and equipment, net consisted of the following (in thousands): As of December 31, 2025 2024 Land $ 1,925 $ 1,350 Buildings and building improvements 29,030 16,012 Leasehold improvements 15,241 9,439 Satellites in orbit 235,387 235,340 Lab, assembly, and integration equipment 95,334 41,693 Satellite antenna 7,224 7,224 Computer hardware and software 25,131 18,244 Other 1,999 1,421 Construction in progress Satellite materials and advance payments, satellites under construction, and advance launch payments 1,122,027 120,984 Other construction in progress and capital advances 39,176 8,328 Total property and equipment, gross $ 1,572,472 $ 460,035 Accumulated depreciation and amortization ( 173,711 ) ( 122,366 ) Total property and equipment, net $ 1,398,761 $ 337,669 Total d epreciation and amortization expense for the years ended December 31, 2025, 2024 and 2023 was approximately $ 51.1 million , $ 63.3 million , and $ 54.5 million , respectively. During the years ended December 31, 2025 , 2024 and 2023, the Company recognized losses on disposal of property and equipment of $ 4.6 million, $ 2.2 million and $ 0.1 million, respectively. These losses primarily relate to equipment retired from service and satellite materials removed from construction in progress as a result of design modifications and advances in manufacturing processes and technolog y. 5. Leases The Company and its subsidiaries are lessees under various operating leases for certain office space, manufacturing facilities and equipment. The Company’s leases have established fixed payment terms which are subject to annual rent increases throughout the term of each lease agreement. The Company’s lease agreements have varying non-cancellable rental periods which include options for the Company to extend portions of its lease terms and have similar terms in which they may terminate the lease prior to the end date but must provide advanced notice. The Company recognizes right-of-use assets and lease liabilities associated with lease agreements with an initial term of 12 months or greater, while lease agreements with an initial term of 12 months or less are not recorded in the Company's consolidated balance sheets. When reasonably certain that renewal options will be exercised, the Company includes lease payments associated with such options, including those that are exercisable at its discretion, in the measurement of its operating leases assets and liabilities. Where implicit rates are not included in the lease agreement, the Company determines the incremental borrowing rate at lease commencement date based on various factors, including the yields on non-investment grade of debt available in the marketplace for the same term as the associated lease. Midland Lease On November 13, 2018, AST LLC entered into both an Economic Development Agreement (the “EDA”) and a sublease agreement with Midland Development Corporation. The premise of the EDA was to create jobs in the Midland, Texas area, as well as to have AST LLC improve the land, office and hangar spaces at the leased facility located at the Midland International Air & Space Port in Midland, Texas. The term of the lease commenced on November 21, 2018 and extends through November 20, 2033. Pursuant to the agreement, the base rental payments are abated for ten years of the lease term provided the Company achieves the total number of full-time jobs and related annual payroll costs, and cumulative capital investments in personal property and improvements to the existing land/structures measured annually on March 31 of each year. The Company recognized the lease reimbursements as an offset to rent expense for the related reimbursable month. 86 The table below sets forth information regarding the Company’s lease agreements with an initial term of greater than 12 months (dollars in thousands): Year ended December 31, 2025 2024 Operating lease right-of-use assets, net $ 19,420 $ 14,014 Operating lease liabilities $ 19,928 $ 14,508 Weighted-average lease term (in years) 7.0 7.3 Weighted-average discount rate 11.0 % 12.4 % The Company generally recognizes lease costs associated with its operating leases on a straight-line basis over the lease term. The table below sets forth information regarding the Company's lease costs, which are included as general and administrative expenses in the Company's consolidated statements of operations for the periods presented (in thousands): Year ended December 31, 2025 2024 2023 Short-term operating lease expense $ 4,682 $ 3,468 $ 2,159 Operating lease expense 2,720 2,031 2,046 Total lease expense $ 7,402 $ 5,499 $ 4,205 As of December 31, 2025, the maturities of the Company’s operating lease liabilities were as follows (in thousands): 2026 $ 4,340 2027 4,187 2028 4,088 2029 4,059 2030 3,040 Thereafter 8,370 Total lease payments 28,084 Less effects of discounting ( 8,156 ) Present value of lease liabilities $ 19,928 Included in the Company's consolidated statements of cash flows under operating activities for years ended December 31, 2025, 2024 and 2023 was $ 2.7 million , $ 2.1 million and $ 2.0 million, respectively, of cash paid for amounts included in the measurement of lease liabilities. 6. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): As of December 31, 2025 2024 Salaries, wages and benefits $ 8,476 $ 3,335 Property and equipment 23,635 3,786 Other professional services 6,435 1,764 Accrued interest expense 12,734 296 Accrued cost of acquiring intangible assets 5,639 - Inventory received but not invoiced 3,977 - Others 8,350 3,014 Total accrued expenses and other current liabilities $ 69,246 $ 12,195 87 7. Debt Long-term debt consists of the following (in thousands): As of December 31, 2025 2024 2032 4.25 % Convertible Notes $ 50,000 $ - 2032 2.375 % Convertible Notes 575,000 - 2036 2.00 % Convertible Notes 1,150,000 - 2034 Convertible Notes - 147,959 Prosperity Capital Equipment Loan 12,552 15,000 Prosperity Term Loan 4,242 4,506 Trinity Capital Equipment Loan (1) 52,641 UBS Bridge Financing Loan 420,000 - Total debt 2,264,435 167,465 Less: current portion of long-term debt ( 11,999 ) ( 2,919 ) Less: unamortized debt issuance costs (1) ( 44,853 ) ( 8,973 ) Long-term debt, net of issuance costs $ 2,207,583 $ 155,573 (1) Includes unamortized end of term payments of $ 4.0 million. The aggregate future contractual maturities of long-term debt were as follows as of December 31, 2025 (in thousands): Year As of December 31, 2025 2026 $ 11,946 2027 433,159 2028 18,044 2029 12,586 2030 12,077 Thereafter 1,776,623 Total principal $ 2,264,435 As of December 31, 2025, the aggregate fair value of the Company’s debt was approximately $ 2.5 billion , which included the fair value of the 2032 4.25 % Convertible Notes of $ 147.2 million , the 2032 2.375 % Convertible Notes of $ 760.8 million , and the 2036 2.00 % Convertible Notes of $ 1,156.7 million . As of December 31, 2024 , the aggregate fair value of the Company’s debt was $ 562.4 million, which included the fair value of the 2034 Convertible Notes of $ 542.9 million . The fair value of the 2032 4.25% Convertible Notes was determined based on recent observable market quote in an active market and rolled forward to year-end using significant inputs derived from, or corroborated by, observable market data (Level 2 inputs). The fair value of the 2032 2.375% Convertible Notes and the 2036 2.00% Convertible Notes were determined based on observable market quotes in an active market around year-end (Level 1 inputs). The fair value of the 2034 Convertible Notes was determined based on a lattice-based binomial model using significant inputs derived from, or corroborated by, observable market data (Level 2 inputs). The fair value of remaining debt has been determined under the discounted cash flow method using significant inputs derived from, or corroborated by, observable market data (Level 2 inputs). Debt discount and issuance costs are comprised of costs incurred in connection with debt issuance and are presented in the consolidated balance sheets as a deduction to the carrying amount of the associated debt and amortized using the effective interest method to interest expense over the term of the debt. During the years ended December 31, 2025, 2024 and 2023, the Company recognized $ 31.8 million , $ 18.7 million and $ 4.5 million of interest expense on outstanding debt, respectively. The interest expense included amortization of debt issuance costs of $ 2.7 million, $ 3.7 million and $ 1.2 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025 , the Company was in compliance with all debt covenant requirements. 2032 4.25% Convertible Notes On January 27, 2025, the Company issued $ 460.0 million aggregate principal amount of convertible senior notes due 2032 (the “2032 4.25% Convertible Notes”), including the exercise in full of the option granted to the initial purchasers to purchase up to 88 $ 60.0 million aggregate principal amount of notes. The 2032 4.25 % Convertible Notes are senior, unsecured obligations of the Company and bear interest at a fixed rate of 4.25 % per year, payable semiannually in arrears on March 1 and September 1 of each year, beginning on September 1, 2025. The 2032 4.25% Convertible Notes will mature on March 1, 2032 , unless earlier repurchased, redeemed, or converted. Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding December 1, 2031 only under the following conditions: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2025 (and only during such calendar quarter), if the last reported sale price of the Company’s Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company’s Class A Common Stock and the conversion rate on each such trading day; (3) if the Company issues a notice of redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after December 1, 2031 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes at any time, at the option of the holder regardless of the foregoing conditions. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s Class A Common Stock or a combination of cash and shares of the Company’s Class A Common Stock, at the Company’s election. The Company may not redeem the notes prior to March 6, 2029. The Company may redeem for cash all or any portion of the notes, at the Company’s option, on or after March 6, 2029, but only if (1) the liquidity condition (as defined in the indenture) is satisfied and (2) the last reported sale price of the Company’s Class A Common Stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes. The initial conversion rate for the 2032 4.25% Convertible Notes is 37.0535 shares of Class A Common Stock per $ 1,000 principal amount of the notes, which represents an initial conversion price of approximately $ 26.99 per share of the Company’s Class A Common Stock. The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, holders who convert their notes in connection with a make-whole fundamental change or a notice of redemption may be entitled to an increase in the conversion rate. The 2032 4.25% Convertible Notes include customary covenants and certain events of default after which the notes may be declared immediately due and payable and set forth certain types of bankruptcy or insolvency events of default after which the notes become automatically due and payable. On July 3, 2025, July 31, 2025 and October 29, 2025, the Company completed the repurchase of $ 225.0 million, $ 135.0 million and $ 50.0 million, respectively, of the outstanding principal amount of the 2032 4.25% Convertible Notes in separate, privately negotiated repurchase transactions with a limited number of note holders for an aggregate repurchase price of approximately $ 502.9 million, $ 346.9 million and $ 161.1 million, respectively, which included accrued and unpaid interest on the repurchased 2032 4.25% Convertible Notes. The repurchase was funded with the net proceeds from a registered direct offering of 9,450,268 shares, 5,775,635 shares and 2,048,849 shares, respectively, of the Company’s Class A Common Stock to the same note holders participating in the note repurchase. The note repurchases and the shares offering were cross-conditional. The Company accounted for the note repurchases as induced conversions and recognized a $ 505.5 million charge to equity for $ 405.8 million of carrying value of the notes repurchased including accrued and unpaid interest and $ 99.7 million of fair value of consideration paid to holders of the 2032 4.25% Convertible Notes in excess of the value to which they were entitled to receive pursuant to the original conversion terms (“Sweetener Payment”). The Company recorded the Sweetener Payment and the $ 3.4 million of third party transaction costs incurred in other (expense) income, net in the Company’s consolidated statements of operations. On and around February 20, 2026, the Company completed an additional repurchase of approximately $ 46.5 million of the outstanding principal amount of the 2032 4.25% Convertible Notes in separate, privately negotiated repurchase transactions with a limited number of note holders for an aggregate repurchase price of approximately $ 180.5 million. The repurchase was funded with the net proceeds from a registered direct offering of 1,862,741 shares of the Company’s Class A Common Stock to the same note holders participating in the note repurchase. The note repurchases and the shares offering were cross-conditional. The Company will account for the note repurchase as an induced conversion. In the first quarter of 2026, the Company expects to recognize an additional charge to equity for the carrying value of the notes repurchased and the related Sweetener Payment. The induced conversion expenses will include the related Sweetener Payment and the third party transaction costs incurred and will be presented in other (expense) income, net in the Company’s consolidated financial statements. 89 2032 2.375% Convertible Notes On July 29, 2025, the Company issued $ 575.0 million aggregate principal amount of convertible senior notes due 2032 (the “2032 2.375 % Convertible Notes”), including the exercise in full of the option granted to the initial purchasers to purchase up to $ 75.0 million aggregate principal amount of notes. The 2032 2.375 % Convertible Notes are senior, unsecured obligations of the Company and bear interest at a fixed rate of 2.375% per year, payable semiannually in arrears on April 15 and October 15 of each year, beginning on April 15, 2026. The 2032 2.375% Convertible Notes will mature on October 15, 2032 , unless earlier repurchased, redeemed, or converted. Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding July 15, 2032 only under the following conditions: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2025 (and only during such calendar quarter), if the last reported sale price of the Company’s Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company’s Class A Common Stock and the conversion rate on each such trading day; (3) if the Company issues a notice of redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after July 15, 2032 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes at any time, at the option of the holder regardless of the foregoing conditions. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s Class A Common Stock or a combination of cash and shares of the Company’s Class A Common Stock, at the Company’s election. The Company may not redeem the notes prior to October 22, 2029. The Company may redeem for cash all or any portion of the notes, at the Company’s option, on or after October 22, 2029, but only if (1) the liquidity condition (as defined in the indenture) is satisfied and (2) the last reported sale price of the Company’s Class A Common Stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes. The initial conversion rate for the 2032 2.375% Convertible Notes is 13.8750 shares of Class A Common Stock per $ 1,000 principal amount of the notes, which represents an initial conversion price of approximately $ 72.07 per share of the Company’s Class A Common Stock. The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, holders who convert their notes in connection with a make-whole fundamental change or a notice of redemption may be entitled to an increase in the conversion rate. The 2032 2.375% Convertible Notes include customary covenants and certain events of default after which the notes may be declared immediately due and payable and set forth certain types of bankruptcy or insolvency events of default after which the notes become automatically due and payable. On and around February 20, 2026, the Company completed the repurchase of $ 250.0 million of the outstanding principal amount of the 2032 2.375% Convertible Notes in separate, privately negotiated repurchase transactions with a limited number of note holders for an aggregate repurchase price of approximately $ 433.7 million, which included accrued and unpaid interest on the repurchased 2032 2.375% Convertible Notes. The repurchase was funded with the net proceeds from a registered direct offering of 4,475,223 shares of the Company’s Class A Common Stock to the same note holders participating in the note repurchase. The note repurchases and the shares offering were cross-conditional. The Company will account for the note repurchase as an induced conversion. In the first quarter of 2026, the Company expects to recognize an additional charge to equity for the carrying value of the notes repurchased and the related Sweetener Payment. The induced conversion expenses will include the related Sweetener Payment and the third party transaction costs incurred and will be presented in other (expense) income, net in the Company’s consolidated financial statements. 2036 2.00% Convertible Notes On October 24, 2025, the Company issued $ 1,000.0 million aggregate principal amount of convertible senior notes due 2036 (the “Notes”) with an option by the initial purchasers to purchase up to an additional $ 150.0 million aggregate principal amount of the Notes. On October 27, 2025, the Company was notified by the initial purchasers of the Notes of the exercise in full of their option to purchase an additional $ 150.0 million aggregate principal amount of the Notes (the “Option Notes”, and together with the Notes, 90 the “2036 2.00% Convertible Notes”). On October 29, 2025, the Company consummated the sale of the Option Notes to the initial purchasers. The 2036 2.00 % Convertible Notes are senior, unsecured obligations of the Company and bear interest at a fixed rate of 2.00% per year, payable semiannually in arrears on January 15 and July 15 of each year, beginning on July 15, 2026. The 2036 2.00% Convertible Notes will mature on January 15, 2036 , unless earlier repurchased, redeemed, or converted. Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding October 15, 2035 only under the following conditions: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2026 (and only during such calendar quarter), if the last reported sale price of the Company’s Class A Common Stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Company’s Class A Common Stock and the conversion rate on each such trading day; (3) if the Company issues a notice of redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. On or after October 15, 2035 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes at any time, at the option of the holder regardless of the foregoing conditions. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of the Company’s Class A Common Stock or a combination of cash and shares of the Company’s Class A Common Stock, at the Company’s election. The Company may not redeem the notes prior to January 22, 2029. The Company may redeem for cash all or any portion of the notes, at the Company’s option, on or after January 22, 2029, but only if (1) the liquidity condition (as defined in the indenture) is satisfied and (2) the last reported sale price of the Company’s Class A Common Stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption, at a redemption price equal to 100 % of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes. The initial conversion rate for the 2036 2.00% Convertible Notes is 10.3845 shares of Class A Common Stock per $ 1,000 principal amount of the notes, which represents an initial conversion price of approximately $ 96.30 per share of the Company’s Class A Common Stock. The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, holders who convert their notes in connection with a make-whole fundamental change or a notice of redemption may be entitled to an increase in the conversion rate. The 2036 2.00% Convertible Notes include customary covenants and certain events of default after which the notes may be declared immediately due and payable and set forth certain types of bankruptcy or insolvency events of default after which the notes become automatically due and payable. 2036 2.25% Convertible Notes On February 17, 2026, the Company issued $ 1,000.0 million aggregate principal amount of convertible senior notes due 2036 (the “2.25% Notes”) with an option by the initial purchasers to purchase up to an additional $ 150.0 million aggregate principal amount of the 2.25% Notes. On February 19, 2026, the Company was notified by the initial purchasers of the 2.25% Notes of the exercise of their option to purchase an additional $ 75.0 million aggregate principal amount of the 2.25% Notes (the “2.25% Option Notes”, and together with the 2.25% Notes, the “2036 2.25% Convertible Notes”). On February 20, 2026, the Company consummated the sale of the 2036 2.25% Convertible Notes to the initial purchasers. The 2036 2.25 % Convertible Notes are senior, unsecured obligations of the Company and bear interest at a fixed rate of 2.25% per year, payable semiannually in arrears on April 15 and October 15 of each year, beginning on October 15, 2026. The 2036 2.25% Convertible Notes will mature on April 15, 2036 , unless earlier converted or repurchased. Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding January 15, 2036 only under the following conditions: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2026 (and only during such calendar quarter), if the last reported sale price of the Company’s Class A common stock, par value $ 0.0001 per share, for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $ 1,000 principal amount of the notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of the Class A Common Stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after January 15, 2036 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or 91 any portion of their notes, at any time, in integral multiples of $ 1,000 principal amount, at the option of the holder regardless of the foregoing conditions. Upon conversion, the Company may satisfy its conversion obligation by paying or delivering, as the case may be, cash, shares of Class A Common Stock or a combination of cash and shares of Class A Common Stock, at the Company’s election. The Company may not redeem the notes prior to the maturity date, and no sinking fund is provided for the notes. The initial conversion rate for the 2036 2.25% Convertible Notes is 8.5982 shares of Class A Common Stock per $ 1,000 principal amount of the notes, which represents an initial conversion price of approximately $ 116.30 per share of the Company’s Class A Common Stock. The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, following certain corporate events that occur prior to the maturity date of the notes, the Company will, under certain circumstances, increase the conversion rate of the notes for a holder who elects to convert its notes in connection with such a corporate event. The 2036 2.25% Convertible Notes include customary covenants and certain events of default after which the notes may be declared immediately due and payable and set forth certain types of bankruptcy or insolvency events of default after which the notes become automatically due and payable. 2034 Convertible Notes Pursuant to the Convertible Security Investment Agreement (the “Investment Agreement”) which the Company entered into with certain investors, the Company issued subordinated convertible notes ( the “2034 Convertible Notes”) for an aggregate principal amount of $ 110.0 million on January 22, 2024 to AT&T Venture Investments, LLC (“AT&T”), Google LLC (“Google”) and Vodafone Ventures Limited (“Vodafone”), and for an aggregate principal amount of $ 35.0 million on May 23, 2024 to Verizon Communications, Inc. (“Verizon”). The 2034 Convertible Notes bear interest at a rate of 5.50 % per year, payable semi-annually in arrears on June 30 and December 30 of each year, beginning on June 30, 2024. The Company had the option to pay interest on the 2034 Convertible Notes in cash or in kind. The Company elected to pay interest on the 2034 Convertible Notes in kind on June 30, 2024, resulting in the principal amount of the 2034 Convertible Notes being increased by approximately $ 3.0 million and interest to be accrued on such increased principal amount in subsequent interest periods. The Company elected to pay interest on the 2034 Convertible Notes in cash on December 30, 2024. On or after 12 months after date of issuance, the Company may require the holders of the 2034 Convertible Notes to convert at an initial conversion rate of 173.9130 shares of Class A Common Stock per $ 1,000 principal amount of 2034 Convertible Notes (equivalent to an initial conversion price of $ 5.75 per share of Class A Common Stock) at its option, if the VWAP of the Class A Common Stock has been at least 130 % of the conversion price then in effect for 30 consecutive trading days, on the immediately succeeding trading day after the last trading day of such 30 day period. On January 22, 2025, the Company notified the holders of the 2034 Convertible Notes that the Company exercised its option to require all of such notes to be converted into shares of the Company’s Class A Common Stock. In the first quarter of 2025, the then outstanding principal amount of the 2034 Convertible Notes, which included an additional interest accrual of approximately $ 0.5 million, was converted into 25,818,541 shares of the Company’s Class A Common Stock and the Company’s obligation under the 2034 Convertible Notes was automatically cancelled upon such share issuance. Prosperity Capital Equipment Loan On August 14, 2023, AST LLC and certain other subsidiaries of the Company entered into a loan agreement with Lone Star State Bank of West Texas (“Lone Star”), succeeded by Prosperity Bank by merger with Lone Star, providing for a $ 15.0 million principal term loan secured by certain real property fixtures and equipment in one of the Company’s Texas facilities (the “Lone Star Loan Agreement”). The entire term loan amount was borrowed on September 19, 2023. Borrowings accrue interest at the Prime Rate plus 0.75 %, subject to a ceiling rate. As of December 31, 2025, the effective interest rate on the borrowings is 8.25 % per annum. Interest payments are due and payable on a monthly basis. Interest payments began in September 2023 and principal payments began in April 2025. Principal repayments are thereafter due in 48 equal monthly installments until January 2029, the maturity date of the loan. In connection with the Lone Star Loan Agreement, the Company deposited a cash balance of $ 15.0 million in the Lone Star Bank Money Market Fund. The Lone Star Loan Agreement includes certain customary affirmative and negative covenants. As part of the AST Companies (defined below) entering into the Trinity Capital Equipment Loan, the AST Companies and Prosperity Bank amended the Lone Star Loan Agreement whereby Prosperity Bank released the lien on certain real property fixtures 92 and equipment and the AST Companies pledged the $ 15.0 million deposit in the Lone Star Bank Money Market Fund as a security for the loan. Prosperity Term Loan On December 8, 2021, the Company’s subsidiary, AST & Science Texas, LLC, executed an agreement to purchase real property, including offices, industrial warehouse buildings and equipment for a total purchase price of $ 8.0 million. In connection with the purchase, AST & Science Texas, LLC entered into an agreement (the “Term Loan Credit Agreement”) with Lone Star, succeeded by Prosperity Bank by merger with Lone Star, to issue a term promissory note for $ 5.0 million with a maturity date of December 8, 2028 that is secured by the property. Borrowings under the Term Loan Credit Agreement bear interest at a fixed rate equal to 4.20 % per annum until December 2026, and from December 2026 until December 2028 at a fixed rate per annum equal to 4.20 % subject to adjustment if the index rate as defined in the Term Loan Credit Agreement is greater than 4.20 %. Interest is payable monthly in arrears commencing in January 2022. Thereafter, outstanding principal and accrued interest are due and payable in monthly installments of $ 40,000 , commencing in January 2023 and continuing until November 2028, with the final remaining balance of unpaid principal and interest due and payable in December 2028. Trinity Capital Equipment Loan On June 27, 2025, AST LLC and certain other subsidiaries of the Company (together with AST LLC, the “AST Companies”) entered into a Master Equipment Financing Agreement (the “MEFA”) with Trinity Capital, Inc. (“Trinity”), as agent (the “Agent”) and lender, and the other lenders party (the “Lenders”), providing for a conditional commitment to provide financing of up to $ 100.0 million (“Trinity Capital Equipment Loan”). In 2025, the AST Companies, the Agent and the Lenders executed four five-year Equipment Financing Schedules (“Schedules”) to the MEFA (together with the Schedules, the “Agreements”) borrowing a total of $ 50.5 million. The borrowings carry an aggregate monthly payment of approximately $ 1.1 million and an end of term payment of 9 % of the drawn amounts. The Company received proceeds of approximately $ 49.1 million, net of debt issuance costs of approximately $ 0.1 million, commitment fee of approximately $ 0.8 million and other finance charges of approximately $ 0.5 million. The Company has the option to prepay all or part of the outstanding principal balances under each Schedule. Any repayment of principal prior to the end of the five-year term will be subject to a prepayment fee equal to 3 % to 5 % of the drawn amounts, depending on the timing of the prepayment. The remaining amount of up to $ 49.5 million may be funded in one or more draws on or before June 30, 2027, subject to the satisfaction of various conditions. The AST Companies’ obligations under the Agreements are secured by certain of the AST Companies’ real property fixtures and equipment. The MEFA contains customary affirmative and negative covenants. The MEFA also contains certain customary events of default that, if they occur, will be deemed to occur under all Schedules. Late charges and a default rate may apply if amounts are paid late or there is another default under the Agreements. The MEFA also requires that all or a portion of the amounts under a Schedule be paid if there is a total loss with respect to the collateral. UBS Bridge Financing Loan On October 31, 2025, BackstopCo, LLC, a subsidiary of AST LLC (“BackstopCo”), entered into a loan agreement with UBS AG, Stamford Branch, as lender (the “UBS Loan Agreement”). The UBS Loan Agreement provides for a cash collateralized term loan facility (the “UBS Loan Facility”) in an aggregate principal amount of $ 420.0 million. The loan under the UBS Loan Facility (“UBS Bridge Financing Loan”) bears interest at a floating rate equal to Term SOFR plus 2.0 % per annum and matures on the earlier of (a) October 31, 2028 and (b) the date on which the UBS Loan Facility shall be terminated or accelerated as provided in the UBS Loan Agreement. The loan under the UBS Loan Facility can be prepaid in whole or in part, without penalty or premium, subject to payment of any applicable breakage costs. The UBS Loan Facility is secured by a first-priority lien on substantially all of BackstopCo’s assets. The Company is not liable as a borrower or guarantor or otherwise for any payments owing in connection with the UBS Loan Facility. AST LLC will act as a limited guarantor under the UBS Loan Facility solely upon the occurrence of certain “bad boy” actions adverse to the lender by AST LLC or its affiliates, and the lender’s recourse to the assets of AST LLC is limited to AST LLC’s equity interests in BackstopCo. In addition, the affirmative and negative covenants contained in the UBS Loan Agreement (as described further below), apply to BackstopCo and/or AST LLC, as applicable. 93 The UBS Loan Agreement includes customary affirmative and negative covenants, including restrictions on additional indebtedness, liens, investments, asset dispositions, mergers, affiliate transactions, and dividends, as well as requirements relating to use of proceeds and compliance with specified agreements, among other covenants as more fully described in the UBS Loan Agreement. Further, at all times following the UBS Loan Facility Closing Date until the maturity or termination of the UBS Loan Facility, BackstopCo is required to maintain cash or cash equivalents on deposit or credited to its collateral account in an amount equal to (or in excess of) 102.0 % of the outstanding principal amount of the loan under the UBS Loan Facility. The UBS Loan Agreement also contains customary events of default (subject to grace periods, where applicable), including, among others, failure to pay principal or interest, cross-defaults to other agreements, breaches of representations and warranties, covenant defaults, the occurrence of a change in control and certain bankruptcy and insolvency events. 8. Warrant Liabilitie s As of December 31, 2025 and December 31, 2024 , warrant liabilities were comprised of Private Placement Warrants. Each whole Private Placement Warrant entitles the registered holder to purchase one whole share of Class A Common Stock at a price of $ 11.50 per share and is exercisable on a cashless basis. Pursuant to the warrant agreement, a holder of Private Placement Warrants may exercise its warrants only for a whole number of shares of Class A Common Stock. This means that only a whole warrant may be exercised at any given time by a warrant holder. The Private Placement Warrants expire on April 6, 2026 , five years after the Business Combination, at 5:00 p.m., New York City time, or earlier upon liquidation. During the year ended December 31, 2025 , 2,931,125 Private Placement Warrants were exercised for 2,294,380 shares of Class A Common Stock on a cashless basis. As of December 31, 2025, there were 122,000 Private Placement Warrants that remained outstanding. During the year ended December 31, 2025 , the Company recognized a net loss of $ 68.2 million for changes in fair value of these Private Placement Warrants. During the year ended December 31 , 2024, the Company recognized a net loss of $ 268.6 million from changes in fair value of warrant liabilities from December 31, 2023 to the time of exercises and full redemption of public warrants and for the Private Placement Warrants that remained outstanding as of December 31, 2024 . The redemption of public warrants resulted in net cash proceeds of $ 153.3 million for the year ended December 31, 2024. During the year ended December 31, 2023, the Company recognized a gain of $ 9.0 million on the change in the fair value of the warrant liabilities. There were no warrant exercises in 2023. 9. Commitments and Contingencies Purchase Commitments As of December 31, 2025, the Company has purchase commitments of approximately $ 489.1 million primarily related to procurement of BB satellite components, research and development (“R&D”) programs, operational services and capital improvements. None of these purchase commitments are considered unconditional purchase obligations as the Company has various rights to adjust the quantity of satellite components on the purchase orders and/or change the delivery timelines in accordance with its ongoing business plan. The Company also has rights to terminate certain purchase commitments and potentially incur a termination fee in certain cases. In addition, the Company has launch agreements under which payments are due at scheduled milestones over the duration of the agreements. The Company has contractual rights to cancel these launches or terminate the related agreements at any time by paying a termination fee, and in certain cases without incurring a termination fee, and any excess payments made to the launch providers for these launches will be refunded to the Company. As of December 31, 2025, the Company had minimum commitments of approximately $ 250.0 - $ 325.0 million related to future launches, none of which are considered unconditional purchase obligations. Legal Proceedings The Company is subject to various legal proceedings and claims that have arisen in the ordinary course of business and that have not been fully adjudicated. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss in excess of any recorded accrual, with respect to loss contingencies. However, the outcome of litigation is inherently uncertain. Therefore, although management considers the likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the Company in a reporting period for amounts in excess of management’s expectations, the Company’s consolidated financial statements for that reporting period could be materially adversely affected. 94 10. Stockholders’ Equity Class A Common Stock As of December 31, 2025, there were 285,449,911 shares of Class A Common Stock issued and outstanding. Holders of Class A Common Stock are entitled to one vote for each share. The Company is authorized to issue 800,000,000 shares of Class A Common Stock with a par value of $ 0.0001 per share. Class B Common Stock As of December 31, 2025, there were 11,227,292 s hares of Class B Common Stock issued and outstanding. Shares of Class B Common Stock were issued to then existing equity holders of AST LLC (other than Mr. Abel Avellan, the Company’s Chairman and Chief Executive Officer (“Mr. Avellan”)) at the time of the Business Combination and are non-economic, but entitle the holder to one vote per share. The Company is authorized to issue 200,000,000 shares of Class B Common Stock with a par value of $ 0.0001 per share. The existing equity holders (other than Mr. Avellan) at the time of the Business Combination own economic interests in AST LLC which are redeemable into either shares of Class A Common Stock on a one-for-one basis or cash at the option of the Company. Upon redemption of the AST LLC Common Units by the existing equity holders (other than Mr. Avellan), a corresponding number of shares of Class B Common Stock held by such existing equity holders will be cancelled. During the year ended December 31, 2024 , the existing equity holders redeemed 38,814,465 AST LLC Common Units into Class A Common Stock and subsequently 38,814,465 Class B Common Stock held by such existing equity holders were cancelled. During the year ended December 31, 2025, there were no such redemptions. Class C Common Stock As of December 31, 2025, there were 78,163,078 shares of Class C Common Stock issued and outstanding. Shares of Class C Common Stock were issued to Mr. Avellan in connection with the Business Combination and are non-economic, but entitle the holder to the lesser of ten votes per share and the Class C Share Voting Amount, the latter of which is a number of votes per share equal to (1) (x) an amount of votes equal to 88.31 % of the total voting power of the outstanding voting stock, minus (y) the total voting power of the outstanding capital stock (other than Class C Common Stock) owned or controlled by Mr. Avellan and his permitted transferees, divided by (2) the number of shares of Class C Common Stock then outstanding (the “Super-Voting Rights”). The Company is authorized to issue 125,000,000 shares of Class C Common Stock with a par value of $ 0.0001 per share. Mr. Avellan owns economic interests in AST LLC which are redeemable into either shares of Class A Common Stock on a one-for-one basis or cash at the option of the Company. Upon redemption of any AST LLC Common Units held by Mr. Avellan, a corresponding number of shares of Class C Common Stock held by Mr. Avellan will be cancelled. Correspondingly, the Super-Voting Rights associated with such shares of Class C Common Stock will be terminated. Preferred Stock As of December 31, 2025 , there were no shares of preferred stock issued or outstanding. The Company is authorized to issue 100,000,000 shares of preferred stock with a par value of $ 0.0001 per share with such designation, rights and preferences as may be determined from time to time by the Company’s Board of Directors. Noncontrolling Interest The noncontrolling interests represent the equity interest in AST LLC held by members other than the Company. Changes in the Company’s ownership interest in AST LLC while retaining control of AST LLC are accounted for as equity transactions. Income or loss is attributed to the noncontrolling interests based on their contractual distribution rights, and the relative percentages of equity interest held by the Company and the other members during the period. As the sole managing member of AST LLC controlling the operating decisions of AST LLC, the Company consolidates the financial position and results of operations of AST LLC and its subsidiaries. The Company reports equity interest in AST LLC held by members other than the Company as noncontrolling interest in the consolidated balance sheets. The noncontrolling interest is classified as permanent equity within the consolidated balance sheets as the Company may only elect to settle a redemption request in cash if the cash delivered in the exchange is limited to the amount of net proceeds from the issuance and sale of Class A Common Stock from a new permanent equity offering. Each issuance of the Company's Class A Common Stock is accompanied by a corresponding issuance of AST LLC Common Units to the Company, which results in a change in ownership and reduction in noncontrolling interest. In addition, the Fifth Amended 95 and Restated Limited Liability Company Operating Agreement of AST LLC permits the noncontrolling interest holders of AST LLC Common Units to exchange AST LLC Common Units, together with related shares of the Class B Common Stock or Class C Common Stock, for shares of the Class A Common Stock on a one-for-one basis or, at the election of the Company, for cash (a “Cash Exchange”). A Cash Exchange is limited to the amount of net proceeds from the issuance and sale of Class A Common Stock from a new permanent equity offering. Future redemptions or direct exchanges of AST LLC Common Units by the noncontrolling interest holders will result in a change in ownership and reduce the amount recorded as noncontrolling interest. As of December 31, 2025 and December 31, 2024 , the noncontrolling interest in AST LLC was approximately 23.9 % and 30.1 % respectively. The decrease in noncontrolling interest percentage during the year ended December 31, 2025 was a result of the issuance of Class A Common Stock in connection with the repurchase of a portion of the 2032 4.25 % Convertible Notes, conversion of the 2034 Convertible Notes, acquisition of certain S-Band ITU priority rights and payment for a portion of the L-band Annual Payment payable in shares, issuance of Class A Common Stock under the 2024 Sales Agreement, the May 2025 Sales Agreement and the October 2025 Sales Agreement, exercises of the Private Placement Warrants, redemptions of AST LLC Common Units in exchange for Class A Common Stock, exercises of options and vesting of restricted stock units. Invesat Blocker Merger Transaction On March 4, 2024, the Company and Invesat LLC (“Invesat”) completed a series of transactions (including a Blocker Merger Transaction as defined in the A&R Operating Agreement, the “Antares Transactions”) resulting in the acquisition by Antares Technologies LLC (“Antares”) of 10,445,200 shares of the Company’s Class A Common Stock. As part of the Antares Transactions, Invesat exercised 319,033 AST Incentive Equity Options and 9,932,541 shares of the Company’s Class B Common Stock and 200,000 shares of the Company’s Class A Common Stock previously held by Invesat were cancelled. In addition, the Company received 10,245,200 AST LLC Common Units held by Invesat prior to the Antares Transactions. After giving effect to the Antares Transactions, the separate limited liability company existence of Invesat ceased. Rakuten Blocker Merger Transaction On October 10, 2024, the Company and Rakuten Mobile USA Service Inc. (“Rakuten USA”) completed a series of transactions (including a Blocker Merger Transaction as defined in the A&R Operating Agreement, the “Rakuten Transactions”) resulting in the acquisition by Rakuten Mobile, Inc. of 28,520,155 shares of Class A Common Stock in exchange for 28,520,155 shares of AST Common Units previously held by Rakuten USA. As part of the Rakuten Transactions, 28,520,155 shares of Class B Common Stock previously held by Rakuten USA were transferred to the Company and immediately cancelled thereby. After giving effect to the Rakuten Transactions, the separate corporate existence of Rakuten USA ceased. June 2023 Common Stock Offering On June 30, 2023, the Company issued 12,500,000 shares of Class A Common Stock in a public offering and received proceeds of $ 56.6 million, net of transaction costs of $ 0.3 million. The Company provided a 30-day option to the underwriting agent to purchase up to an additional 1,875,000 shares to cover over-allotments, if any. The over-allotment option was not exercised. January 2024 Common Stock Offering On January 23, 2024, the Company issued 32,258,064 shares of Class A Common Stock in a public offering and received proceeds of $ 93.6 million, net of underwriting commissions of $ 6.0 million and transaction costs of $ 0.4 million. The Company provided a 30-day option to the underwriting agent to purchase up to an additional 4,838,709 shares of Class A Common Stock (the “Option Shares”) from us on the same terms and conditions. On January 25, 2024, the Option Shares were exercised in full. The offering of the Option Shares closed on January 29, 2024 for proceeds of $ 14.1 million, net of underwriting commissions of $ 0.9 million. 2022 Equity Distribution Agreement On September 8, 2022, the Company entered into an Equity Distribution Agreement (the “Sales Agreement” or “At The Market Equity Program”) with Evercore Group L.L.C. and B. Riley Securities, Inc. (collectively, the “agents”) to sell shares of the Company’s Class A Common Stock having an aggregate sale price of up to $ 150.0 million through an “at the market offering” program under which the agents acted as sales agents. The sales of the shares made under the Sales Agreement were to be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended (the “Securities Act”). The agents sold the Company’s Class A Common Stock based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company imposed). Under the Sales Agreement, the agents were entitled to total compensation at a commission rate of up to 3.0 % of the gross sales price per share sold. Under the Sales Agreement, the Company issued 12,277,653 shares and 1,527,909 shares of its Class A Common Stock under the 96 Sales Agreement and received proceeds of $ 117.4 million and $ 7.2 million net of commissions paid to the agents and transaction costs for the shares settled during the years ended December 31, 2024 and December 31, 2023, respectively. The At The Market Equity Program was fully utilized as of July 15, 2024. 2024 Equity Distribution Agreement On September 5, 2024, the Company entered into an Equity Distribution Agreement (the “2024 Sales Agreement” or “2024 At The Market Equity Program”) with B. Riley Securities, Inc., Barclays Capital Inc., BofA Securities, Inc., Cantor Fitzgerald & Co., Deutsche Bank Securities Inc., Roth Capital Partners, LLC, Scotia Capital (USA) Inc. and UBS Securities LLC (collectively, the “agents”) to sell shares of the Company’s Class A Common Stock having an aggregate sale price of up to $ 400.0 million through an “at the market offering” program under which the agents acted as sales agents. The sales of the shares made under the 2024 Sales Agreement were to be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act. The agents sold the Class A Common Stock based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company imposed). Under the 2024 Sales Agreement, the agents were entitled to total compensation at a commission rate of up to 3.0 % of the gross sales price per share sold. Under the 2024 Sales Agreement, the Company issued 2,918,407 and 12,678,261 shares of Class A Common Stock and received proceeds of approximately $ 74.8 million and approxim ately $ 314.7 millio n, net of commissions paid to the agents and transaction costs during the years ended December 31, 2025 and 2024, respectively. Having utilized virtually the entire capacity of the 2024 ATM Equity Program, the Company terminated the 2024 ATM Equity Program on May 13, 2025 when the Company entered into the May 2025 ATM Equity Program. May 2025 Equity Distribution Agreement On May 13, 2025, the Company entered into an Equity Distribution Agreement (the “May 2025 Sales Agreement” or “May 2025 ATM Equity Program”) with B. Riley Securities, Inc., Barclays Capital Inc., BofA Securities, Inc., Cantor Fitzgerald & Co., Deutsche Bank Securities Inc., Roth Capital Partners, LLC, Scotia Capital (USA) Inc., UBS Securities LLC and William Blair & Company, L.L.C. (collectively, the “agents”) to sell shares of the Company’s Class A Common Stock having an aggregate sale price of up to $ 500.0 million through an “at the market offering” program under which the agents acted as sales agents. The sales of the shares made under the May 2025 Sales Agreement were to be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act. The agents sold the Class A Common Stock based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company imposed). Under the May 2025 Sales Agreement, the agents were entitled to total compensation at a commission rate of up to 3.0 % of the gross sales price per share sold. Under the May 2025 Sales Agreement, the Company issued 13,605,359 shares of its Class A Common Stock and received proceeds of approximately $ 488.7 million, net of commissions paid to the agents and transaction costs during the year ended December 31, 2025. Having utilized virtually the entire capacity of the May 2025 ATM Equity Program, the Company terminated the May 2025 ATM Equity Program on July 23, 2025. October 2025 Equity Distribution Agreement On October 7, 2025, the Company entered into a new Equity Distribution Agreement (the “October 2025 Sales Agreement” or “October 2025 ATM Equity Program”) with B. Riley Securities, Inc., Barclays Capital Inc., BofA Securities, Inc., Cantor Fitzgerald & Co., Deutsche Bank Securities Inc., Roth Capital Partners, LLC, Scotia Capital (USA) Inc., UBS Securities LLC, William Blair & Company, L.L.C and Yorkville Securities, LLC (collectively, the “agents”) to sell shares of the Company’s Class A Common Stock having an aggregate sale price of up to $ 800.0 million through an “at the market offering” program under which the agents act as sales agents. The sales of the shares made under the October 2025 Sales Agreement are to be made by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 promulgated under the Securities Act. The agents sale of the Class A Common Stock is based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company may impose). Under the October 2025 Sales Agreement, the agents are entitled to total compensation at a commission rate of up to 3.0 % of the gross sales price per share sold. Under the October 2025 Sales Agreement, the Company issued 10,128,222 shares of Class A Common Stock during the year ended December 31, 2025 and received proceeds of $ 706.3 million, net of commissions paid to the agents and transaction costs. During the year ended December 31, 2025, the Company paid commission of approximately $ 12.6 million to the agents with respect to such sales and incurred initial transaction costs of approximately $ 0.4 million. January 2025 Capped Calls On January 27, 2025, in connection with the issuance of the 2032 4.25 % Convertible Notes, the Company entered into privately 97 negotiated capped call transactions (the “January 2025 Capped Calls”) with certain of the initial purchasers of the 2032 4.25% Convertible Notes or their respective affiliates at a cost of approximately $ 44.5 million. The January 2025 Capped Calls cover, subject to anti-dilution adjustments, the number of shares of Class A Common Stock underlying the 2032 4.25% Convertible Notes. The capped call transactions can be settled in cash or shares at the Company’s option and are expected generally to reduce the potential dilution to the Class A Common Stock upon any conversion of the 2032 4.25% Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the 2032 4.25% Convertible Notes. The January 2025 Capped Calls have an initial strike price of approximately $ 26.99 per share and an initial cap price of $ 44.98 per share, which are subject to certain adjustments under the terms of the January 2025 Capped Calls. On November 4, 2025, the Company sold the January 2025 Capped Calls for net cash proceeds of approximately $ 74.5 million. No January 2025 Capped Calls were outstanding after the sale. The Company recorded the net cash proceeds as an addition to equity in the consolidated balance sheets. July 2025 Capped Calls On July 29, 2025, in connection with the issuance of the 2032 2.375 % Convertible Notes, the Company entered into privately negotiated capped call transactions (the “July 2025 Capped Calls”) with certain of the initial purchasers of the 2032 2.375% Convertible Notes or their respective affiliates at a cost of approximately $ 54.0 million. The July 2025 Capped Calls cover, subject to anti-dilution adjustments, the number of shares of Class A Common Stock underlying the 2032 2.375% Convertible Notes. The capped call transactions can be settled in cash or shares at the Company’s option and are expected generally to reduce the potential dilution to the Class A Common Stock upon any conversion of the 2032 2.375% Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the 2032 2.375% Convertible Notes. The July 2025 Capped Calls have an initial strike price of approximately $ 72.07 per share and an initial cap price of $ 120.12 per share, which are subject to certain adjustments under the terms of the July 2025 Capped Calls. The July 2025 Capped Calls are equity classified and included as a reduction to equity in the consolidated balance sheets. The Company did not terminate or amend the July 2025 Capped Calls in the February 2026 repurchases of a portion of the 2032 2.375% Convertible Notes. 98 11. Stock-Based Compensation Stock-Based Compensation Expense Stock-based compensation, measured at the grant date based on the fair value of the award, is typically recognized ratably over the requisite services period, using the straight-line method of expense attribution. The Company recorded stock-based compensation expense in the following categories of its consolidated statements of operations (in thousands): Year ended December 31, 2025 2024 2023 Engineering services costs $ 25,834 $ 15,416 $ 8,832 General and administrative costs 21,197 16,623 4,457 Cost of revenues - services 459 - - Total $ 47,490 $ 32,039 $ 13,289 The Company estimates the fair value of the stock option awards to employees, non-employees and non-employee members of the Board of Directors using the Black-Scholes option pricing model, which requires the input of subjective assumptions, including (i) the expected volatility of the Company's stock, (ii) the expected term of the award, (iii) the risk-free interest rate, and (iv) any expected dividends. Due to the lack of company-specific historical and implied volatility data, the Company based the estimate of expected volatility on the estimated and expected volatilities of a representative group of publicly traded companies. For these analyses, the Company selects companies with comparable characteristics including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected life of the stock-based awards. The Company computes the historical volatility data using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the stock-based awards. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of the Company’s stock price becomes available. For awards that qualify as “plain-vanilla” options, the Company estimates the expected life of the employee stock options using the “simplified” method, whereby, the expected life equals the average of the vesting term and the original contractual term of the option. The expected term of stock options granted to non-employees is equal to the contractual term of the option award. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The fair value of restricted stock units or restricted stock granted to employees, non-employees, and non-employee members of the Board of Directors is based on the fair value of the Company’s stock on the grant date. The Company elects to account for forfeitures as they occur rather than apply an estimated forfeiture rate to stock-based compensation expense. AST LLC 2019 Equity Incentive Plan Prior to the Business Combination, under the 2019 Equity Incentive Plan (“AST LLC Incentive Plan”), AST LLC was authorized to issue ordinary shares, as well as options exercisable for ordinary shares, as incentives to its employees, non-employees, and non-employee members of its Board of Directors. Following the Business Combination, no further grants were made or will be made under the AST LLC Incentive Plan. In connection with the Business Combination, the existing AST LLC options were reclassified into options to acquire AST LLC Incentive Equity Units, and there was no incremental compensation cost and the terms of the outstanding awards, including fair value, vesting conditions and classification, were unchanged. Each AST LLC Incentive Equity Unit is convertible into one AST LLC Common Unit and each AST LLC Common Unit is redeemable for one share of Class A Common Stock on the later of the (i) 24-month anniversary of the consummation of the Business Combination and (ii) six-month anniversary from the vesting date. The AST LLC Incentive Plan continues to govern the terms and conditions of the outstanding awards granted under it, except that in lieu of ordinary shares, holders of options under the AST LLC Incentive Plan have the right to exercise for AST LLC Incentive Units, which may then be converted into AST LLC Common Units, which may further be converted into shares of the Class A Common Stock. There were two types of options granted under the AST LLC Incentive Plan: (1) service-based options and (2) performance-based options. Service-based options typically vest over a five year service period with 20 % of the award vesting on the first anniversary of the employee’s commencement date, and the balance thereafter in 48 equal monthly installments. Certain service-based options also provide for accelerated vesting if there is a change in control or other performance condition as defined by the AST LLC Incentive Plan. Performance-based options typically vest on the earliest date that any of the following occurs: (i) AST LLC effects an initial public offering and becomes a reporting company, (ii) AST LLC experiences a change of control, or (iii) other specified 99 performance conditions. Both service-based and performance-based options typically expire no later than 10 years from the date of grant. As of December 31, 2025, AST LLC was authorized to issue a total of 12,812,959 ordinary shares under a reserve set aside for equity awards. As of December 31, 2025, there were 4,677,777 options outstanding under the AST LLC Incentive Plan. Following the Business Combination on April 6, 2021, no further equity award grants were made under the AST LLC Incentive Plan. The following table summarizes the Company’s option activity for the year ended December 31, 2025: Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at December 31, 2024 6,390,261 $ 1.14 4.79 $ 127,533,921 Granted - - Exercised ( 1,697,806 ) 1.35 Cancelled or forfeited ( 14,678 ) 10.00 Outstanding at December 31, 2025 4,677,777 $ 1.04 3.72 $ 334,888,519 Options exercisable as of December 31, 2025 3,921,920 $ 1.16 3.66 $ 280,310,813 Vested and expected to vest at December 31, 2025 3,921,920 $ 1.16 3.66 $ 280,310,813 The following table summarizes the Company’s unvested option activity for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at December 31, 2024 869,112 $ 0.64 Granted - - Vested ( 99,088 ) 3.18 Forfeited ( 14,167 ) 4.15 Unvested at December 31, 2025 755,857 $ 0.24 The fair value of each stock option is estimated on the date of grant using a Black-Scholes option-pricing model. There were no stock options granted during the years ended December 31, 2025, 2024 and 2023. The total intrinsic value of options exercised during the years ended December 31, 2025, 2024 and 2023 was $ 121.0 million , $ 24.5 million, and $ 17.7 million, respectively. As of December 31, 2025, compensation cost related to options issued under the AST LLC Incentive Plan has been fully recognized except for performance-based options for which performance conditions were not deemed probable at year-end. SpaceMobile 2020 Incentive Award Plan In connection with the Business Combination, the Company adopted the 2020 Incentive Award Plan (the “2020 Plan”). Awards may be made under the 2020 Plan covering an aggregate number of Class A Common Stock shares equal to 10,800,000 . Any shares distributed pursuant to an award may consist, in whole or in part, of authorized and unissued Common Stock, treasury Common Stock or Common Stock purchased on the open market. The 2020 Plan provides for the grant of stock options, restricted stock, dividend equivalents, restricted stock units, incentive unit awards, stock appreciation rights, and other stock or cash-based awards. Each incentive unit issued pursuant to an award, if any, shall count as one share for purposes of calculating the aggregate number of shares available for issuance under the 2020 Plan. On July 29, 2024 , the 2020 Plan was replaced and superseded by the AST SpaceMobile, Inc. 2024 Incentive Award Plan. No new awards may be made under the 2020 Plan, although outstanding awards previously made under the 2020 Plan continue to be governed by the terms of the 2020 Plan. Refer below for further detail. 100 Two types of equity awards have been granted under the 2020 Plan: (1) service-based options and (2) service-based and performance-based restricted stock units. Service-based options typically vest over a four year service period with 25 % of the award vesting on the first anniversary of the employee’s commencement date, and the balance thereafter in 36 equal monthly installments. Service-based restricted stock units typically vest over a four year service period with 25% of the award vesting on each anniversary of the employee’s vesting commencement date. Performance-based restricted stock units typically vest on the earliest date that any of the following occurs: (i) the Company attains an incremental capital investment, or (ii) other specified performance conditions. Options typically expire no later than 10 years from the date of grant. Stock Options As of December 31, 2025, there were 2,214,866 options outstanding under the 2020 Plan. The following table summarizes the Company’s option activity under the 2020 Plan for the year ended December 31, 2025: Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at December 31, 2024 3,649,458 $ 9.15 7.88 $ 45,288,968 Granted - - Exercised ( 1,224,936 ) 8.99 Cancelled or forfeited ( 209,656 ) 9.60 Outstanding at December 31, 2025 2,214,866 $ 9.20 7.11 $ 140,519,893 Options exercisable as of December 31, 2025 1,525,273 $ 8.89 6.73 $ 97,222,406 Vested and expected to vest at December 31, 2025 2,214,866 $ 9.20 7.11 $ 140,519,893 The following table summarizes the Company’s unvested option activity for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at December 31, 2024 1,701,857 $ 4.70 Granted - - Vested ( 817,983 ) 4.41 Forfeited ( 194,281 ) 4.78 Unvested at December 31, 2025 689,593 $ 5.02 The weighted-average grant-date fair value per share of stock options granted during the years ended December 31, 2024 and 2023 was $ 4.81 and $ 2.53 , respectively. No stock options were granted under the 2020 Plan during the year ended December 31, 2025. The total intrinsic value of options exercised during the years ended December 31, 2025 and 2024 was $ 78.0 million and $ 5.3 million, respectively. There were no options exercised under the 2020 Plan during the year ended December 31, 2023. As of December 31, 2025, total unrecognized compensation expense related to the unvested stock options was $ 3.5 million, which is expected to be recognized over a weighted average period of 1.8 years. Restricted Stock Units As of December 31, 2025, there were 1,233,054 restricted stock units outstanding under the 2020 Plan. 101 The following table summarizes the Company’s unvested restricted stock unit activity for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at December 31, 2024 2,967,177 $ 12.55 Granted - - Vested ( 1,406,498 ) 10.94 Forfeited ( 327,625 ) 20.41 Unvested at December 31, 2025 1,233,054 $ 12.30 As of December 31, 2025, total unrecognized compensation expense related to the unvested restricted stock units was $ 11.0 million, which is expected to be recognized over a weighted average period of 1.9 years. SpaceMobile 2024 Incentive Award Plan On September 10, 2024, the Company’s stockholders approved the AST SpaceMobile, Inc. 2024 Incentive Award Plan, which replaced and superseded the 2020 Plan, effective July 29, 2024 (the “Effective Date”). On November 21, 2025, the Company’s stockholders approved the amended and restated AST SpaceMobile, Inc. 2024 Incentive Award Plan (as amended and restated, the “2024 Plan”), effective November 21, 2025. Awards may be made under the 2024 Plan covering an aggregate number of Class A Common Stock shares not to exceed the sum of (i) 16,000,000 shares, which consists of (a) 2,000,000 shares authorized for issuance under the 2024 Plan as of the Effective Date, (b) 2,000,000 shares authorized for issuance, effective as of January 1, 2025, by the Company’s Board of Directors pursuant to the evergreen feature of the 2024 Plan discussed below, (c) 2,000,000 shares authorized for issuance, effective January 1, 2026, by the Company’s Board of Directors pursuant to the evergreen feature of the 2024 Plan discussed below, and (d) an additional 10,000,000 shares authorized for issuance under the 2024 Plan, effective as of November 21, 2025, plus (ii) one share for every one share available for award under the 2020 Plan as of July 30, 2024. Any shares subject to an award under the 2024 Plan or the 2020 Plan that expires, is forfeited, otherwise terminates or is settled in cash, after the Effective Date, shall be added to the shares reserved for issuance under the 2024 Plan. In addition, the number of shares available for issuance under the 2024 Plan may increase on each January 1st occurring following the Effective Date in an amount up to 2,000,000 shares by action of the Company’s Board of Directors or its committee as applicable. On each December 4, 2024 and December 30, 2025 in accordance with the evergreen feature, effective January 1, 2025 and January 1, 2026, respectively, an additional 2,000,000 shares of Common Stock were authorized by the Company’s Board of Directors to be issued under the 2024 Plan. Any shares distributed pursuant to an award may consist, in whole or in part, of authorized and unissued Common Stock, treasury Common Stock or Common Stock purchased on the open market. The 2024 Plan provides for the grant of stock options, restricted stock, dividend equivalents, restricted stock units, incentive unit awards, stock appreciation rights, and other stock or cash-based awards. Each incentive unit issued pursuant to an award, if any, shall count as one share for purposes of calculating the aggregate number of shares available for issuance under the 2024 Plan. Three types of equity awards have been granted under the 2024 Plan : (1) service-based options, (2) service-based and performance-based restricted stock units and (3) restricted stock to eligible directors serving on the Company’s Board of Directors. Service-based options typically vest over a four year service period with 25 % of the award vesting on the first anniversary of the employee’s vesting commencement date, and the balance thereafter in 36 equal monthly installments. Service-based restricted stock units typically vest over a three or four year service period with 1/3 or 25% of the award vesting on each anniversary of the employee’s vesting commencement date. Restricted stock awarded to directors will vest in full on the earlier to occur of (i) the one-year anniversary of the applicable grant date and (ii) the date of the next Annual Meeting of Stockholders following the grant date. Performance-based restricted stock units typically vest on the earliest date that any of the following occurs: (i) the Company attains an incremental capital investment, or (ii) other specified performance conditions. 102 Stock Options As of December 31, 2025, there were 65,250 options outstanding under the 2024 Plan. The following table summarizes the Company’s option activity under the 2024 Plan for the year ended December 31, 2025: Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding as of December 31, 2024 44,000 $ 22.51 9.93 $ - Granted 23,000 28.57 - Exercised ( 1,750 ) 22.51 - Cancelled or forfeited - - - Outstanding as of December 31, 2025 65,250 $ 24.65 9.01 $ 3,130,950 Options exercisable as of December 31, 2025 10,164 $ 22.51 8.93 $ 509,420 Vested and expected to vest as of December 31, 2025 55,086 $ 25.04 9.03 $ 2,621,530 The following table summarizes the Company’s unvested option activity for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at December 31, 2024 44,000 $ 12.42 Granted 23,000 16.23 Vested ( 11,914 ) 12.42 Forfeited - - Unvested at December 31, 2025 55,086 $ 14.01 The weighted-average grant-date fair value per share of stock options granted during the years ended December 31, 2025 and December 31, 2024 was $ 16.23 and $ 12.42 , respectively. As of December 31, 2025, total unrecognized compensation expense related to the unvested stock optio ns was $ 0.7 million , which is expected to be recognized over a weighted average period o f 3.0 years. The fair value of each stock option is estimated on the date of grant using a Black-Scholes option-pricing model, with the assumptions used for the years ended December 31, 2025 and December 31, 2024, respectively, presented on a weighted average basis: Year ended December 31, 2025 Year Ended December 31, 2024 Exercise price $ 28.57 $ 22.51 Fair market value $ 16.23 $ 12.42 Expected dividend yield 0.0 % 0.0 % Expected term (in years) 6.1 6.1 Expected volatility 55.30 % 53.28 % Weighted-average risk-free rate 4.28 % 4.10 % 103 Restricted Stock Units and Restricted Stock As of December 31, 2025 , there were 6,873,666 restricted stock units and restricted stock outstanding under the 2024 Plan. The following table summarizes the Company’s unvested restricted stock unit and restricted stock activity under the 2024 Plan for the year ended December 31, 2025: Number of Shares Weighted-Average Grant Date Fair Value Unvested at December 31, 2024 1,310,382 $ 23.49 Granted 6,857,678 47.45 Vested ( 569,550 ) 31.82 Forfeited ( 724,844 ) 57.13 Unvested at December 31, 2025 6,873,666 $ 43.16 As of December 31, 2025, total unrecognized compensation expense related to the unvested restricted stock units and restricted stock under the 2024 Plan was $ 172.8 million, which is expected to be recognized over a weighted average period of 2.6 ye ars. SpaceMobile 2020 Employee Stock Purchase Plan In connection with the Business Combination, the Company adopted the 2020 Employee Stock Purchase Plan (the “ESPP”). The aggregate number of Common Stock shares that may be issued pursuant to rights granted under the ESPP is 2,000,000 shares. If any right granted under the ESPP shall for any reason terminate without having been exercised, the shares not purchased under such right shall again become available for issuance under the ESPP. As of December 31, 2025, the Company had not issued any awards under the ESPP. 12. Income Taxes The Company, organized as a C corporation, owns an equity interest in AST LLC in what is commonly referred to as an “Up-C” structure. For U.S. federal and state income tax purposes, AST LLC has elected to be treated as a partnership and does not pay any income taxes since its income and losses are included in the returns of the members. The portion of the Company’s taxable income or loss attributable to the noncontrolling interests of AST LLC is taxed directly to such members. Consequently, no provision for income taxes has been included in the financial statements related to this portion of taxable income. Certain foreign wholly-owned entities are taxed as corporations in the jurisdictions in which they operate, and accruals for such taxes are included in the consolidated financial statements. The Company has operations in India, the United Kingdom (“U.K.”), Spain and Israel with tax filings in each foreign jurisdiction. Income Tax Expense The components of income (loss) before income taxes were as follows (in thousands): Year ended December 31, 2025 2024 2023 United States $ ( 463,858 ) $ ( 529,258 ) $ ( 230,487 ) Foreign 6,745 4,256 9,491 Total $ ( 457,113 ) $ ( 525,002 ) $ ( 220,996 ) 104 The income tax expense was as follows (in thousands): Year ended December 31, 2025 2024 2023 Current: Federal $ - $ - $ - State - - - Foreign 6,453 1,997 2,576 Total current 6,453 1,997 2,576 Deferred: Federal - - - State - - - Foreign ( 2,555 ) ( 669 ) ( 895 ) Total deferred ( 2,555 ) ( 669 ) ( 895 ) Total income tax provision $ 3,898 $ 1,328 $ 1,681 The differences between the effective income tax rate and the statutory U.S. federal income tax rate for the year ended December 31, 2025 are as follows (dollars in thousands): Year ended December 31, 2025 Amount Percent U.S. federal statutory tax rate ( 95,994 ) 21 % State and local income tax, net of federal (national) income tax effect (1) ( 11 ) 0 % Foreign tax effects 2,481 ( 1 %) Effect of cross-border tax laws 1,296 0 % Tax credits Research and development tax credit ( 11,162 ) 2 % Changes in valuation allowances 66,265 ( 14 %) Nontaxable or non-deductible items Changes in fair value of warrant liability 14,312 ( 3 %) Non-controlling interest 21,154 ( 5 %) Non-deductible compensation 5,557 ( 1 %) Effective tax rate 3,898 ( 1 %) (1) State taxes in California and Massachusetts make up the majority (greater than 50 percent) of the tax effect in this category. The differences between the effective income tax rate and the statutory U.S. federal income tax rate for years ended December 31, 2024 and 2023 are as follows: Year ended December 31, 2024 2023 Statutory U.S. federal income tax rate 21 % 21 % Income (loss) attributable to noncontrolling interest and non taxable income (loss) ( 4 %) ( 13 %) Changes in fair value of warrant liabilities ( 11 %) 1 % Change in valuation allowance ( 7 %) ( 10 %) Research and development credit 1 % 1 % Other 0 % ( 1 %) Effective income tax rate 0 % ( 1 %) 105 Income taxes paid for the year ended December 31, 2025 are as follows (in thousands): 2025 Federal $ - State - Foreign Saudi Arabia 4,000 Foreign other 2,798 Total cash paid for income taxes (net of refunds) $ 6,798 Deferred Tax Assets and Liabilities Deferred income taxes reflect the net tax effects of tax carryovers and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the balances for income tax purposes. Significant components of deferred tax assets and liabilities are as follows (in thousands): As of December 31, 2025 2024 Deferred tax assets: Net operating loss carryforwards $ 125,765 $ 56,006 Basis difference in the equity of AST LLC 457,008 140,668 Research and development credit 25,243 13,223 Other 14,578 3,829 Total gross deferred tax assets 622,594 213,726 Less valuation allowance: ( 618,440 ) ( 212,127 ) Net deferred tax assets 4,154 1,599 Deferred tax liabilities: Intangibles ( 14,902 ) - Total gross deferred tax liabilities ( 14,902 ) - Net deferred tax (liabilities) assets $ ( 10,748 ) $ 1,599 As of December 31, 2025 the Company had unused federal net operating loss carryforwards (gross) for federal income tax purposes of approxim ately $ 503.2 million, which can be carried forward indefinitely and may be used to offset future taxable income. In addition, the Company had unused net operating loss carryforwards (gross) for state income tax purposes of approximately $ 164.0 million, $93.9 million of which expire in 2041 to 2045 . The remaining $70.1 million net operating loss carryforwards (gross) for state income tax can be carried forward indefinitely. The Company also had unused net operating loss carryforwards (gross) for foreign income tax purposes of approximately $ 4.5 million, which can be carried forward indefinitely. Management assesses the need for a valuation allowance in each tax paying component or jurisdiction based upon the available positive and negative evidence to estimate whether sufficient taxable income will exist to permit realization of the deferred tax assets. On the basis of this evaluation, as of December 31, 2025 and 2024 the Company's valuation allowance was $ 618.4 million and $ 212.1 million, respectively. The change from December 31, 2024 to December 31, 2025 was primarily driven by the basis difference in the equity of AST LLC, an increase in the net operating loss carryforward in the U.S. jurisdiction, and an increase in the state blended rate. The change from December 31, 2023 to December 31, 2024 was primarily driven by the basis difference in the equity of AST LLC and an increase in the net operating loss carryforward in the U.S. jurisdiction. As of December 31, 2025, the Company had deferred tax assets in Germany, Israel, and Spain of $ 4.2 million and as of December 31, 2024, the Company had deferred tax assets in Germany, Israel, Spain, and the U.K. of $ 1.6 million. No valuation allowance was recorded against these deferred tax assets, as it was more likely than not that they would be fully realized. As of December 31, 2025, the U.K. was in a net deferred tax liability position of $ 14.9 million and therefore, no valuation allowance was recorded in that jurisdiction. The foreign deferred tax asset is subject to foreign exchange risk, which could reduce the amount the Company may ultimately realize. Additionally, future changes in tax laws or interpretations of such tax laws may limit the Company’s ability to fully utilize the foreign net operating loss carryforwards. 106 Unrecognized Tax Benefits There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2025. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. Tax Receivable Agreement In connection with the closing of the Business Combination, the Company entered into the Tax Receivable Agreement (the “ Tax Receivable Agreement”). Pursuant to the Tax Receivable Agreement, the Company is generally required to pay the TRA Holders (as defined in the Tax Receivable Agreement) 85.0 % of the amount of savings, if any, in U.S. federal, state, local, and foreign taxes that are based on, or measured with respect to, net income or profits, and any interest related thereto that the Company and any applicable consolidated, unitary, or combined Subsidiaries (the “Tax Group”) realize, or are deemed to realize, as a result of certain “Tax Attributes,” which include: • existing tax basis in certain assets of AST LLC and certain of its direct or indirect Subsidiaries, including assets that will eventually be subject to depreciation or amortization, once placed in service, attributable to AST LLC Common Units acquired by the Company from a TRA Holder (including AST LLC Common Units held by a Blocker Corporation acquired by us in a Reorganization Transaction (as defined in the Tax Receivable Agreement)), each as determined at the time of the relevant acquisition; • tax basis adjustments resulting from taxable exchanges of AST LLC Common Units (including any such adjustments resulting from certain payments made by us under the Tax Receivable Agreement) acquired by the Company from a TRA Holder pursuant to the terms of the A&R Operating Agreement; • tax deductions in respect of portions of certain payments made under the Tax Receivable Agreement; and • certain tax attributes of Blocker Corporations holding AST LLC Common Units that are acquired directly or indirectly by the Company pursuant to a Reorganization Transaction. Some circumstances, such as the Company’s election to terminate early the Tax Receivable Agreement or certain changes of control of the Company or AST LLC (as described in the A&R Operating Agreement), may require the Company to make lump-sum cash payments based on certain assumptions to all the TRA Holders equal to the present value of all forecasted future payments that would have otherwise been made under the Tax Receivable Agreement. Payments under the Tax Receivable Agreement will be the obligations of the Company and not obligations of AST LLC. Any payments made by the Company under the Tax Receivable Agreement will generally reduce the amount of overall cash flow that might have otherwise been available to the Company. As of December 31, 2025, there have been no Tax Receivable Agreement liabilities recorded. U.S. federal income tax returns for tax years 2022 and forward remain open to examination. The Company and its subsidiaries are also subject to income tax in multiple state, local and foreign jurisdictions. Substantially all significant state and local income tax returns for the years 2022 and forward are open to examination. Substantially all significant foreign income tax returns for the years 2021 and forward are open to examination. 13. Net Loss per Share Basic and diluted net loss per share attributable to the holders of Class A Common Stock is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of Class A Common Stock outstanding during the period. 107 The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net loss per share of Class A Common Stock (in thousands, except share data): Year Ended December 31, 2025 2024 2023 Numerator Net loss before allocation to noncontrolling interest $ ( 461,011 ) $ ( 526,330 ) $ ( 222,677 ) Net loss attributable to the noncontrolling interest ( 119,071 ) ( 226,247 ) ( 135,116 ) Net loss attributable to common stockholders - basic and diluted $ ( 341,940 ) $ ( 300,083 ) $ ( 87,561 ) Denominator Weighted-average number of shares of Class A Common Stock outstanding - basic and diluted 253,502,780 154,501,344 81,824,122 Weighted-average number of penny warrants - basic and diluted 2,479,812 - - Weighted-average number of shares - basic and diluted 255,982,592 154,501,344 81,824,122 Net loss per share attributable to holders of Class A Common Stock - basic and diluted $ ( 1.34 ) $ ( 1.94 ) $ ( 1.07 ) In accordance with FASB ASC 260, Earnings Per Share, penny warrants are warrants that would be exercised for no or little consideration and therefore should be included in the calculation of weighted average shares outstanding for purposes of calculating basic and diluted net income (loss) per share. The Penny Warrants became exercisable (subject to a lockup until March 22, 2026 which lockup was waived by the Company in February 2026) and are included in basic and diluted net loss per share from June 23, 2025 when the Bankruptcy Court (as defined below) approved the Spectrum Usage Rights Transaction (as defined below) with Ligado, LLC. At December 31, 2025, the Company excluded from the calculation of diluted net loss per share 11,227,292 shares of Class B Common Stock, 78,163,078 shares of Class C Common Stock, 122,000 Private Placement Warrants, 11,835,421 shares of Class A Common Stock that may be issued pursuant to awards outstanding under the AST LLC Incentive Plan, the 2020 Plan and the 2024 Plan, a nd 21,772,975 shares of Class A Common Stock issuable upon conversion of the 2032 4.25 % Convertible Notes, the 2032 2.375 % Convertible Notes, and the 2036 2.00 % Convertible Notes (on an as-converted basi s) as their effect would have been to reduce the net loss per share. Therefore, the weighted-average number of shares of Class A Common Stock outstanding used to calculate both basic and diluted net loss per share of Class A Common Stock is the same. Shares of the Company’s Class B and Class C Common Stock do not participate in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted loss per share of Class B and Class C Common Stock under the two-class method has not been presented. 14. Spectrum Usage Rights and Related Financing On January 5, 2025, AST LLC entered into a binding agreement (the “Strategic Collaboration Term Sheet”) with Ligado LLC under which the Company will receive long-term access to up to 45 MHz of lower mid-band spectrum in the United States and Canada for direct-to-device satellite applications. The Strategic Collaboration Term Sheet was entered into as part of the restructuring of Ligado LLC, which together with certain of its direct and indirect subsidiaries (together with Ligado LLC, “Ligado”) filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (“Bankruptcy Court”). On March 22, 2025, pursuant to the Strategic Collaboration Term Sheet, the Company, AST LLC, Spectrum USA I, LLC, a subsidiary of AST LLC (“SpectrumCo”) and Ligado entered into certain definitive agreements that, among other things, provided for (1) a $ 550.0 million contingent payment from the Company to Ligado, (2) SpectrumCo’s obligation to make spectrum access usage payments of at least $ 80.0 million annually (“L-band Annual Payment”) (with the option to pay the excess of the amount owed by Ligado to utilize the L-band spectrum in Class A Common Stock of the Company for the first three years), and revenue share payments in exchange for the right to use up to 40 MHz of the L-band spectrum, (3) the Company’s obligation to pay a usage fee amount due in cash (plus a 30 % premium with respect to each such payment payable, at the Company’s discretion, in cash or in Class A Common Stock of the Company) (the “Crown Castle Annual Payment”) for the right to use up to 5 MHz of the 1670-1675 MHz spectrum, and (4) issuance of 4,714,226 penny warrants, each of which entitles the holder to purchase one whole share of Class A Common Stock at a price of $ 0.01 per share (“Penny Warrants”), to Ligado. The Penny Warrants are equity classified and accounted for as non-employee share-based payments under ASC 718, Compensation – Stock Compensation, with a grant date fair value of approximately $ 121.2 million. 108