AST SpaceMobile’s FCC Test Arrives as Investors Weigh a Costly Q2 Miss

Space-based cellular broadband network provider AST SpaceMobile (NASDAQ: ASTS) is facing its next big test as the company continues to build out its constellation of low Earth orbit (LEO) BlueBird satellites.

On Friday, Aug. 14, the Midland, Texas-based company, which provides direct-to-device (D2D) connectivity, received a 30-day authorization from the U.S. Federal Communications Commission (FCC) to test its satellite connectivity using the 800 MHz spectrum and up to 100 commercially available and unmodified devices.

The clearance comes at a critical time for the company and its investors, with shares of the SpaceX (NASDAQ: SPCX) rival struggling to regain their year-to-date (YTD) and all-time high set on May 28. Since then, the stock is down nearly 50%.

AST SpaceMobile Aims to Take Advantage of Temporary FCC Authorization

AST SpaceMobile’s 30-day authorization, which runs through Sept. 12, includes testing of 817 MHz to 824 MHz Earth-to-space uplink—specific radio frequency ranges used by devices, including mobile phones, to transmit data to a central network, cell tower, or satellite.

The authorization also includes testing of 862 MHz to 869 MHz space-to-Earth downlink bands—specific radio frequency ranges used to transmit data, voice, or video from a central network source, such as the company’s BlueBird satellites.

Those spectrums are available for D2D services because its signals travel farther and penetrate buildings better than higher-frequency waves, which is particular to AST SpaceMobile’s objective of providing cellular connectivity to rural areas and so-called dead zones.

However, the current testing permitted by the FCC is limited to non-commercial applications.

According to the FCC’s authorization, the agency also mandated that all AST SpaceMobile testing must comply with the company’s existing agreement with communication services sector giant T-Mobile (NASDAQ: TMUS).

That cooperative effort—along with AST SpaceMobile’s more than 60 other strategic partners—is essential to the company reaching its goal of putting 45 BlueBirds into LEO by early 2027.

It also builds on the joint venture between AT&T (NYSE: T), T-Mobile, and Verizon (NYSE: VZ) announced May 14 that aims to expand satellite-based D2D wireless coverage in the United States by pooling spectrum resources, improving D2D capacity, and creating a more unified platform for satellite providers. Currently, only T-Mobile uses Starlink to fill coverage gaps, while AT&T and Verizon have agreements in place with AST SpaceMobile.

Successful FCC Test Could Provide a Tailwind Following Q2 Earnings Miss

The 30-day authorization could not be better-timed. Shares of ASTS are up nearly 17% over the past month and have been trying to gain momentum since late May, when a sell-off took hold. The stock hit its YTD low on July 29, having fallen more than 60% from its May 28 all-time high.

But a subpar Q2 earnings report on Aug. 10 derailed that reversal. AST SpaceMobile announced earnings per share (EPS) of negative 77 cents, well off the analyst consensus estimate of negative 32 cents, alongside quarterly revenue of $31.52 million, which also missed the analyst forecast of $34.53 million.

The EPS miss was the company’s sixth consecutive and followed an equally disappointing Q1 miss. The Q2 report also shed light on other areas of concern. Specifically, capital expenditures (CapEx) ballooned from around $257 million to over $610 million—an increase of more than 137% for the rapidly scaling company.

Adjusted operating expenses also raised concerns, with a more than 205% year-over-year (YOY) increase in engineering services costs, while adjusted operating expenses surged more than 130% YOY from $51.7 million to more than $119 million.

Guidance was also worrisome. Q3 adjusted operating expenses are expected to increase to between $105 million and $115 million, while the company’s 2026 revenue plan remains highly dependent on successful satellite launches, gateway deliveries, and contract milestones. AST SpaceMobile has now beat on EPS expectations in just two of the past 10 quarters.

The report was not without its highlights, though. AST SpaceMobile announced that it has approximately $1.3 billion in revenue backlog and more than $3.7 billion of pro forma cash, equivalents, and restricted cash. It also reported three U.S. government contract awards with more than $100 million of funded value expected in 2026–2027 and said that government revenue could become a recurring multibillion-dollar annual opportunity beginning in 2027.

Wall Street Remains Wary

Despite a nearly $86 consensus price target, reflecting 30% potential upside, sentiment on ASTS is mixed.

Of the 12 analysts currently covering the stock, it receives a consensus Hold rating with only four assigning it a Buy.

Insider buying has dried up over the past year, with just two buys totaling around $187,000 versus seven sells totaling more than $451 million.

However, institutional ownership has been decidedly bullish. Over the past year, inflows of $2.29 billion from 378 buyers have easily surpassed outflows of just over $364 million from 107 sellers.

Current short interest remains elevated, though, at 18.51% of the float. But that isn’t atypical for a high-volatility stock that currently carries a beta of 2.76.

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