Spire Global Stock Rises with AI-Enhanced Space Analytics

Satellite network operator Spire Global Inc. SPIR provides space-to-cloud data and analytics services through a subscription model. The company operates one of the largest constellations of small satellites comprised of its proprietary Lemurs. The company will be added to the Russell 3000 index on July 1, 2024.

Spire Global operates in the aerospace sector and competes with satellite operators, including AST Space Mobile Inc. ASTS, Planet Labs PBC PL, and Telesat Co. TSAT.

Spire Global Develops and Operates Lemur Satellites

The Lemur nanosatellite is outfitted with a weather sensor, a GPS receiver, and an automatic identification systems (AIS) receiver. These low-orbit nanosatellites collect data on various factors, including maritime traffic, aircraft tracking, and weather, to provide subscribers with insights and analytics. The company implemented generative artificial intelligence (AI) and machine learning (ML) to enhance operations and services.

Spire's AI-Powered Weather Forecasting

AI is used to automate anomaly detection or unusual patterns to ensure data reliability and quality. Predictive modeling is enhanced with AI to predict weather patterns and forecasts, flight delays, or ship movements utilizing historical and real-time data. Potential risks and inefficiencies in transportation logistics can be derived from analyzing data on vessel location and movements.

In April, Spire announced a multi-million-dollar contract with a financial firm for weather forecasts using Spire's high-resolution weather forecast model. This provides a six-day outlook developed by an AI-powered model for long-range forecasting utilizing proprietary data collected from space. Spire's satellites capture precise vertical profiles of pressure, humidity, and temperature around the planet, including under-observed and remote regions. By initializing AI forecasting using Spire's proprietary datasets, the company is ushering in a new era of accuracy and reliability in weather forecasting.

SPIR Stock Attempts to an Ascending Triangle Breakout Pattern

The daily candlestick chart for SPIR illustrates an attempt at an ascending triangle breakout. The pattern is comprised of the ascending (rising) lower trendline that started at the $8.10 swing low. This trendline is formed by connecting the higher candlestick lows rising to meet the flat-top upper trendline resistance of $10.29 at the apex point. It's a case of the unstoppable force (rising lower trendline) meeting the immovable object (upper flat trendline). A breakout forms when SPIR rises through $10.29. The daily relative strength index (RSI) is slowly rising to the 56-band. Pullback support levels are at $9.47, $8.52, $8.10, and $7.54.

Spire Global Continues to Tighten Its Losses in Q1 2024

First-quarter 2024 revenues rose 6.3% YoY and 20% sequentially to $25.7 million, which missed consensus estimates by $2.29 million. GAAP operating losses were $11.9 million, which was an 18% YoY improvement. Non-GAAP operating losses fell by 28% YoY to $7 million. Net loss in Q1 2024 fell by 43% YoY to $25.2 million, and adjusted EBITDA improved 84% YoY to $1.1 million.

Spire's Subscription RPO of $195.7 Million

The remaining performance obligations (RPOs) not yet recognized were $195.7 million. Under a subscription model, revenue is not recognized until service is provided and is usually spread out over a 12-month period, even if it's prepaid. Spire Global expects to recognize 42% of the RPO in the upcoming 12 months.

Spire Provides Financial Outlook for Q2 and Full Year 2024

Spire expects Q2 2024 revenues between $29 million to $33 million, representing 9% to 24% YoY growth. Non-GAAP operating profits and losses are expected between a loss of $3 million to a profit of $1 million. Adjusted EBITDA is expected between $2 million and $5 million. Non-GAAP EPS loss is expected between 31 cents to 15 cents.

Spire expects full-year 2024 revenues between $122 million to $132 million, representing 15% to 25% YoY growth. Adjusted EBITDA is expected to be between $7 million to $15 million. Non-GAAP EPS loss is expected between $1.11 to 70 cents. 

AI is Paving the Way for More Opportunities for Spire

Spire Global CEO Peter Platzer commented, “For over a decade, Spire's trajectory has been shaped by two enduring global megatrends: global security and the escalating impacts of climate change.” 

Platzer added, “Since our founding, we’ve focused on providing insights that can only be gained from the ultimate vantage point of space to help solve these global issues. Now with the sophistication and increased adoption of technologies like artificial intelligence, we’re seeing an even bigger opportunity to provide more accurate and reliable insights, powered by our proprietary data set.”

Spire Global analyst ratings and price targets are at MarketBeat. The consensus price target is 60% higher at $16.83.

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