Momentus Inc. (NASDAQ:MNTS), a space infrastructure company, announced today a preliminary financial update and a settlement in shareholder derivative litigation. The company disclosed expected revenues of $1.0 to $2.0 million for the first half of 2024, with a net loss anticipated to be between $14.0 and $16.0 million.
Selling, general, and administrative expenses for the same period are projected to range from $10.0 to $12.0 million. Momentus also reported cash and cash equivalents of approximately $1.5 to $2.0 million as of June 30, 2024.
The company has reached an agreement to settle shareholder derivative litigation that required the adoption of certain corporate governance reforms to be maintained for at least four years. These settlements relate to lawsuits initially filed between June 2022 and June 2023, involving various claims against the company and certain officers and directors. As part of the settlement, all related actions will be dismissed.
Additionally, Momentus disclosed that on July 31, 2024, a legal judgment was issued against the company for $368,588 plus interest and expenses regarding the advancement and reimbursement of legal expenses for former employees. The company is in discussions to resolve the judgment.
In financing news, Momentus has borrowed $1.65 million under a secured convertible promissory note agreement with Space Infrastructure Ventures, LLC, as of September 5, 2024.
In other recent news, Momentus Inc. faces potential Nasdaq delisting due to non-compliance with listing rules following the delay of its quarterly financial report. The company has until October 21, 2024, to submit a compliance plan.
Momentus has also been selected by NASA as a launch provider in the VADR contract, showcasing its ongoing involvement in space infrastructure and launch services.
In financial developments, Momentus secured a $2.3 million convertible note from Space Infrastructure Ventures and $500,000 through director loans primarily allocated for employee retention payments and note expenses.
The company has also collaborated with the Defense Advanced Research Projects Agency and Ascent Solar Technologies to develop space technologies and market a new solar array solution respectively.
Lastly, a leadership change has occurred with Lon Ensler appointed as the interim Chief Financial Officer following the departure of Eric Williams. These are some of the recent developments at Momentus Inc.
InvestingPro Insights
In light of Momentus Inc.'s recent financial update and corporate developments, InvestingPro data provides additional context to assess the company's performance and market position. As of the last twelve months leading up to Q4 2023, Momentus has demonstrated a remarkable revenue growth of over 933%, with revenues reaching $3.09 million. This surge is complemented by an impressive gross profit margin of 72.32%, indicating a strong ability to convert sales into profit.
However, these positives are tempered by significant challenges. The company's operating income margin stands at an alarming -2206.93%, and it has reported a substantial net loss. InvestingPro Tips suggest that Momentus may struggle with making interest payments on its debt and is quickly burning through cash, which is consistent with the company's reported net loss and low cash reserves. Additionally, with a market capitalization of just $12.63 million and a stock price that has significantly underperformed over the last year, investors should be cautious. It's worth noting that analysts do not expect the company to be profitable this year, and the stock is trading at a high revenue valuation multiple.
For investors seeking a more in-depth analysis, there are over ten additional InvestingPro Tips available at https://www.investing.com/pro/MNTS. These tips could provide further insights into Momentus's financial health and future prospects.
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