BlackSky Technology Inc.

Previous wording

BlackSky is a space-based intelligence company that delivers real-time imagery, analytics and high-frequency monitoring of the world’s most critical and strategic locations, economic assets, and events. BlackSky is trusted by many of the most demanding U.S. and international government agencies and commercial businesses around the world. We are defining a new category of space-based intelligence products and services with real-time imagery and automated analytics, delivered through an easy-to-use interface coupled with our high-revisit and low latency satellite constellation, which are designed to help customers see, understand and anticipate change for a decisive strategic advantage.

Current wording

Founded in 2014, BlackSky is a space technology company that delivers real-time imagery, analytics and high-frequency monitoring of the world’s most critical and strategic locations, economic assets, and events. By taking a software-first technology approach, we are delivering real time space-based intelligence at disruptive speed, scale and economics. BlackSky is trusted by many of the most demanding U.S. and international government agencies and commercial businesses around the world. We are defining a new category of space-based intelligence products and services centered upon real-time imagery and automated analytics, delivered through an easy-to-use interface that operates seamlessly with our high-revisit and low latency satellite constellation. Our first-of-its-kind, purpose-built, secure artificial intelligence ("AI")-enabled space-to-ground architecture helps customers see, understand and anticipate change for a decisive strategic advantage. BlackSky can provide dynamic hourly monitoring over many of the most strategic locations on Earth up to 15 times per day from dawn to dusk.

Previous wording

Our revenue is generated by selling imagery and software analytics services through our BlackSky Spectra platform and by providing professional and engineering services to strategic customers on a project basis.

Current wording

Our revenue is generated by selling space-based intelligence & AI services through our BlackSky Spectra software platform and by providing mission solutions and advanced technology programs to strategic customers on a project basis.

Previous wording

◦Data, Software, and Analytics: Our analytics services are also offered on a subscription basis and provide customers with access to our site monitoring, event monitoring and global data services. We leverage our proprietary AI and ML algorithms to analyze data coming from both our proprietary sensor network and third-party space sources in real-time to provide data, insights, and analytics for our customers. We provide services related to object, change and anomaly detection, site monitoring, and enhanced analytics through which we can detect key pattern of life changes in critical locations. These critical locations can include strategic locations and infrastructure such as ports, airports, and construction sites; retail activity; commodities stockpiles; and other sites that contain critical commodities and supply chain inventory.

Current wording

Our AI-generated analytics are also offered on a subscription basis and provide customers with automated access to our site monitoring, event monitoring, and global data services. Our object change and anomaly detection, site monitoring, and enhanced analytics services can detect key pattern-of-life changes in critical locations. These critical locations include infrastructure, such as maritime ports, airfields, and construction sites; retail activity; commodities stockpiles; and other sites that contain critical commodities and supply chain inventory. Our AI-enabled analytics provide for the automated detection and classification of more than 30 objects of tactical interest.

Previous wording

•Professional and Engineering Services Revenue—We develop and deliver advanced satellites and payload systems for specific strategic customers that desire to leverage our capabilities in mission systems engineering and operations, ground station operations, software, analytics and systems development. These systems are sold to government customers under fixed price contracts and are often sold with operating and imagery service subscriptions. We retain rights to intellectual property for developed technology of certain systems.

Current wording

•Mission Solutions Revenue: We develop and deliver customized advanced satellites and payload systems for specific strategic customers that desire to leverage our capabilities in mission systems engineering and operations, ground station operations, software, analytics and systems development. By integrating our Gen-3 satellites, secure ground infrastructure, launch support, operations software, and training, this offering delivers rapid access to actionable intelligence, enhances mission continuity in secure or air-gapped environments, and supports national self-reliance in defense decision-making. Mission solutions empower customers to retain ownership and custody of satellites, tasking, and data while operating within their own borders and security frameworks. With proven, military-grade technology, globally distributed manufacturing, high-availability on-orbit performance, and transfer-of-knowledge programs that develop local workforce expertise, we enable partners to confidently build, operate, and evolve customized sovereign space architectures that strengthen national security and modern deterrence. These systems are sold to government customers under fixed price contracts and are often sold with operating and imagery service subscriptions. We retain rights to intellectual property for developed technology of certain systems. We also provide software systems engineering development services to support the integration of high volume and mass quantities of data in their operating platforms.

Previous wording

Professional and engineering services revenue decreased for the three months ended September 30, 2025, as compared to the same period in 2024, primarily from the substantial completion of a long-term professional services contract. Professional and engineering services revenue contains estimates that can result in the recognition of revenue in a current period for performance obligations which were satisfied or partially satisfied in a prior period. For the impacts of changes in estimates on our contracts, see Note 2—“Basis of Presentation and Summary of Significant Accounting Policies” of the notes to the consolidated financial statements contained within this Quarterly Report on Form 10-Q.

Current wording

Mission solutions and advanced technology programs revenue contain estimates that may result in the recognition of revenue in a current period for performance obligations that were satisfied or partially satisfied in a prior period. For the impacts of changes in estimates on our contracts, see Note 2—“Basis of Presentation and Summary of Significant Accounting Policies” of the notes to the consolidated financial statements contained within this Quarterly Report on Form 10-Q.

Previous wording

Our costs and expenses are incurred from the following categories:

Current wording

Our costs and expenses, which includes stock-based compensation expense for those employees who support each category, are incurred from the following categories:

Previous wording

•Imagery and software analytical services costs primarily include third-party data and imagery, ground station service payments, internal labor to support the ground stations and space operations, and compute/storage costs to facilitate our expanding AI/ML functionality. Costs are expensed as incurred except for incremental costs to obtain a contract, which are primarily sales commissions on contracts greater than one year and are capitalized and amortized to selling, general, and administrative expenses on a systematic basis consistent with the transfer of goods and services and directly identifiable costs to fulfill a contract. Expense related to stock-based payments is classified in the unaudited condensed consolidated statements of operations and comprehensive loss based upon the classification of each employee's cash compensation. We recognize stock-based compensation expense for those employees whose work supports the imagery and software analytical services costs we provide to customers, under imagery and software analytical service costs, excluding depreciation and amortization.

Current wording

•Space-Based Intelligence & AI Services Costs: primarily include third-party data and imagery, ground station service payments, internal labor to support our ground stations and space operations, and compute/storage costs to facilitate our expanding AI/machine learnings ("ML") functionality. Costs are expensed as they are incurred except for incremental costs to obtain a contract, which are primarily sales commissions on contracts greater than one year, and are capitalized and amortized to selling, general, and administrative expenses on a systematic basis consistent with the transfer of goods and services and directly identifiable costs to fulfill a contract. Expense related to stock-based payments is classified in the unaudited condensed consolidated statements of operations and comprehensive loss based upon the classification of each employee's cash compensation.

Previous wording

•Professional and engineering service costs primarily include the cost of internal labor for design and engineering in support of long-term development contracts for customer satellites and payload systems as well as subcontract direct materials and external labor costs to build and test specific components, such as the communications system, payload demands, and sensor integration. In addition, we recognize internal labor costs and external subcontract labor costs for our customer-centric software service solutions. We also recognize stock-based compensation expense for those employees who provide professional and engineering services support to customers, under professional and engineering service costs, excluding depreciation and amortization.

Current wording

•Mission Solutions Costs: primarily include the cost of direct materials to build and test specific, customized satellite and payload systems components, such as the communications system, payload demands, and sensor integration, as well as internal labor for design and engineering. These costs are incurred in support of long-term development contracts.

Previous wording

•Selling, general, and administrative expense consists of salaries and benefit costs, development costs, professional fees, and other expenses which include other personnel-related costs, stock-based compensation expenses for those employees who generally support our business and operations, and occupancy costs.

Current wording

•Selling, General, and Administrative Expense: consists of salaries, taxes, and benefit costs, product development costs, professional fees, and other expenses which include other personnel-related costs, stock-based compensation expense for those employees who generally support our business and operations, and occupancy costs.

Previous wording

•Research and development expense consists of employees’ salaries, taxes, and benefits costs incurred while researching next generation space and ground architectures in support of our long-term strategy. With our acquisition of BlackSky Satellite Systems in November 2024, research and development expense also includes our investments in satellite design and functionality. Additionally, we employ and classify third-party vendors who help fulfill our strategic projects as research and development expense. We intend to continue to invest appropriate resources in research and development efforts, as we believe that investment is critical to maintaining our competitive position.

Current wording

•Research and Development Expense: consists of employees’ salaries, taxes, and benefits costs incurred while researching next generation space and ground architectures in support of our long-term strategy, which includes investments in satellite design and functionality. Additionally, we employ and classify third-party vendors who help fulfill our strategic projects as research and development expense. We intend to continue to invest appropriate resources in research and development efforts, as we believe that investment is critical to maintaining our competitive position.

Previous wording

•Depreciation expense is related to property and equipment, which mainly consist of operational satellites. Amortization expense is related to intangible assets, which mainly consist of customer relationships.

Current wording

•Depreciation Expense: is related to property and equipment, which mainly consist of operational satellites and capitalized internal-use software. Amortization expense is related to intangible assets, which mainly consist of customer relationships. We expect to incur additional depreciation expense when each Gen-3 satellite is launched and placed into service.

Previous wording

Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024

Current wording

Results of Operations for the Three Months Ended March 31, 2026 and 2025

Previous wording

The following table provides the components of results of operations for the three and nine months ended September 30, 2025 and 2024:

Current wording

The following table provides the components of results of operations for the three months ended March 31, 2026 and 2025:

Previous wording

Professional & engineering service costs, excluding depreciation and amortization, increased for the nine months ended September 30, 2025 as compared to the same period in 2024, primarily due to a one-time impact of incurred work in process costs under a satellite procurement contract that began in the first quarter of 2025. This increase was partially offset by fewer direct material costs incurred on a professional services contract, related to the program's maturity year-over-year.

Current wording

Mission solutions costs, excluding depreciation and amortization, decreased for the three months ended March 31, 2026 as compared to the same period in 2025, primarily due to the impact of incurred work in process costs under a satellite procurement contract that began in 2025.

Previous wording

The following is our forecast for total RSU expense as of September 30, 2025, which, in addition to the amounts recognized in selling, general, and administrative expenses, includes the portion that will be capitalized or classified in imagery and software analytical service costs and professional and engineering service costs:

Current wording

The following is our forecast for total restricted stock units ("RSUs") non-cash stock-based compensation expense as of March 31, 2026, which excludes certain executive RSUs that were forfeited after March 31, 2026 but before the filing date. In addition to the amounts recognized in selling, general, and administrative expenses, this includes the portion that will be capitalized or classified in space-based intelligence & AI services, mission solutions, or advanced technology programs costs:

Previous wording

Research and development expense decreased for the three and nine months ended September 30, 2025, as compared to the same periods in 2024 due to the completion of development projects in 2024. We expect for research and development costs to increase as we explore new projects in future periods.

Current wording

Research and development expense decreased for the three months ended March 31, 2026, as compared to the same period in 2025, due to the completion of certain development projects in early 2025.

Previous wording

Depreciation expense from all other property and equipment increased for the three and nine months ended September 30, 2025 as compared to the same periods in 2024, primarily driven by the depreciation of increasing asset balances for internal-use software as we continue to invest in our BlackSky Spectra software platform, features for our Gen-3 constellation, and internal infrastructure.

Current wording

Depreciation expense from all other property and equipment increased for the three months ended March 31, 2026 as compared to the same period in 2025. This increase was primarily driven by the depreciation of increasing asset balances for internal-use software as we continue to invest in our BlackSky Spectra software platform, features for our Gen-3 constellation, and internal infrastructure.

Previous wording

Amortization expense increased for the three and nine months ended September 30, 2025 as compared to the same periods in 2024 as a result of intangible assets acquired by the Company in the fourth quarter of 2024.

Current wording

Amortization expense increased for the three months ended March 31, 2026 as compared to the same period in 2025 due to the change in the estimated useful life of an intangible asset during the fourth quarter of 2025.

Previous wording

Fluctuations in our equity warrants and other equity instruments that we classify as derivative liabilities in our unaudited condensed consolidated balance sheets and measure at fair value are significantly driven by our common stock price. Fluctuations to these instruments are inversely related to changes in our common stock price, the volatility of the markets, and the duration of the equity warrants.

Current wording

Our common stock price significantly drives fluctuations in our equity warrants and other equity instruments that we classify as derivative liabilities in our unaudited condensed consolidated balance sheets and measure at fair value. Fluctuations to these instruments are inversely related to changes in our common stock price, the volatility of the markets, and the duration of the equity warrants. These re-measurements of derivative liabilities generated a loss for the three months ended March 31, 2026 and a gain for the three months ended March 31, 2025.

Previous wording

Interest income increased during the three and nine months ended September 30, 2025 as a result of higher short-term investment balances during the period as compared to the same periods in 2024.

Current wording

Interest income increased during the three months ended March 31, 2026 as a result of higher short-term investment balances during the period as compared to the same period in 2025.

Previous wording

Adjusted EBITDA is defined as net income or loss attributable to us before interest income, interest expense, income tax expense or benefit, depreciation and amortization, as well as significant non-cash and/or non-recurring expenses as our management believes these items are not useful in evaluating our core operating performance. These items include, but are not limited to, stock-based compensation expense; unrealized (gain) loss on certain warrants/shares classified as derivative liabilities; loss on debt extinguishment, non-recurring transaction costs; litigation, settlements, and related costs; severance; and impairment and asset disposals. We have presented Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe that the exclusion of certain items in calculating Adjusted EBITDA can produce a useful measure for period-to-period comparisons of our business. Accordingly, we believe that Adjusted EBITDA provides useful information in understanding and evaluating our operating results. In addition, we believe that Adjusted EBITDA provides additional information for investors to use in evaluating our ongoing operating results and trends. This non-GAAP measure provides investors with incremental information for the evaluation of our performance after isolation of certain items deemed unrelated to our core business operations.

Current wording

Adjusted EBITDA is defined as net income or loss attributable to us before interest income, interest expense, income tax expense or benefit, depreciation and amortization, as well as significant non-cash and/or non-recurring expenses as our management believes these items are not useful in evaluating our core operating performance. These items include, but are not limited to, stock-based compensation expense; unrealized gain or loss on certain warrants/shares classified as derivative liabilities; loss on debt extinguishment; non-recurring transaction costs; litigation, settlements, and related costs; severance; and impairment, obsolescence, and asset disposals. We have presented Adjusted EBITDA because it is a key measure used by our management and board of directors to understand and evaluate our operating performance, generate future operating plans and make strategic decisions regarding the allocation of capital. In particular, we believe that the exclusion of certain items in calculating Adjusted EBITDA can produce a useful measure for period-to-period comparisons of our business. Accordingly, we believe that Adjusted EBITDA provides useful information in understanding and evaluating our operating results. In addition, we believe that Adjusted EBITDA provides additional information for investors to use in evaluating our ongoing operating results and trends. This non-GAAP measure provides investors with incremental information for the evaluation of our performance after isolation of certain items deemed unrelated to our core business operations.

Previous wording

The table below reconciles our net loss to Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024. As noted above, in November 2024, we acquired the remaining 50% of the common units of BlackSky Satellite Systems, fka LeoStella, and it is now a wholly-owned subsidiary of BlackSky. Prior to the acquisition, our unaudited condensed consolidated financial statements included our proportionate share of BlackSky Satellite System's, fka LeoStella's, earnings or losses, which was included as an adjusting item for equity method investments in the table below; we did not record any percentage of BlackSky Satellite System's, fka LeoStella's, estimated net loss during the three and nine months ended September 30, 2024 since our investment in LeoStella was $0 as of December 31, 2023. Subsequent to the acquisition in the fourth quarter of 2024, BlackSky

Current wording

The table below reconciles our net loss to Adjusted EBITDA for the three months ended March 31, 2026 and 2025:

Previous wording

As of September 30, 2025, our existing sources of liquidity included cash and cash equivalents and short-term investments. Our cash and cash equivalents excluding restricted cash totaled $28.8 million and $13.1 million as of September 30, 2025 and December 31, 2024, respectively, and our short-term investments totaled $117.7 million and $39.4 million as of September 30, 2025 and December 31, 2024, respectively. We have incurred year to date losses and generated negative cash flows from operations since our inception in September 2014. As of September 30, 2025, we had an accumulated deficit of $725.6 million.

Current wording

As of March 31, 2026, our existing sources of liquidity included cash and cash equivalents and short-term investments. Our cash and cash equivalents excluding restricted cash totaled $39.4 million and $42.4 million as of March 31, 2026 and December 31, 2025, respectively, and our short-term investments totaled $76.1 million and $82.0 million as of March 31, 2026 and December 31, 2025, respectively. We have incurred year to date losses and generated negative cash flows from operations since our inception in September 2014. As of March 31, 2026, we had an accumulated deficit of $756.1 million.

Previous wording

Our short-term liquidity as of September 30, 2025 was $147.6 million. We expect cash and cash equivalents and cash generated from operating activities to be sufficient to meet our working capital and capital expenditure needs for the foreseeable future. Our future long-term capital requirements will depend on many factors, including our Gen-3 satellite production needs, launch costs and insurance costs, as well as our growth rate, customer demand for capacity, the timing and extent of spending to support solution development efforts, the expansion of sales and marketing activities, the ongoing investments in technology infrastructure, the introduction of new and enhanced solutions, and the continuing market acceptance of our solutions.

Current wording

Our short-term liquidity as of March 31, 2026 was $117.5 million. We expect cash and cash equivalents, short-term investments, and cash generated from operating activities to be sufficient to meet our working capital and capital expenditure needs for the foreseeable future. Our future long-term capital requirements will depend on many factors, including our Gen-3 satellite and mission solutions production needs, launch and insurance costs, our growth rate, customer demand for capacity, the timing and extent of spending to support solution development efforts, our ongoing investments in technology infrastructure, and the continuing market acceptance of our products and services.

Previous wording

In July 2025, we issued $185.0 million principal amount of Convertible Notes in a private offering. The Convertible Notes will mature on August 1, 2033 unless earlier converted, redeemed or repurchased. The

Current wording

In July 2025, we issued $185.0 million aggregate principal amount of Convertible Senior Notes in a private offering. The Convertible Senior Notes will mature on August 1, 2033 unless earlier converted, redeemed or repurchased. The Convertible Senior Notes will bear interest at a rate of 8.25% per year, payable semiannually in arrears on February 1 and August 1 of each year, beginning on February 1, 2026.

Previous wording

During the nine months ended September 30, 2025, we issued and sold shares as a part of the Company's at-the-market (“ATM”) offering. We have the ability to offer and sell from time to time up to $75.0 million of newly issued shares in open trading windows at market prices through a designated broker dealer pursuant to an ATM offering program, of which we sold $42.5 million during the nine months ended September 30, 2025.

Current wording

During the three months ended March 31, 2026, we issued and sold shares of our Class A common stock under our ATM sales agreement, resulting in gross proceeds of $15.0 million. We have the ability to offer and sell up to $100.0 million of shares of our Class A common stock in open trading windows at market prices through a designated broker dealer pursuant to an ATM offering program.

Previous wording

As of September 30, 2025, our current assets were $201.0 million, consisting primarily of short-term investments, contract assets, and cash and cash equivalents.

Current wording

As of March 31, 2026, our current assets were $185.3 million, consisting primarily of short-term investments, cash and cash equivalents, accounts receivable, and contract assets.

Previous wording

As of September 30, 2025, our current liabilities were $51.7 million, consisting primarily of contract liabilities, other current liabilities, and accounts payable and accrued liabilities. Accordingly, we have sufficient cash and working capital to fund our short-term liquidity requirements.

Current wording

As of March 31, 2026, our current liabilities were $53.6 million, consisting primarily of contract liabilities, accounts payable and accrued liabilities, and other current liabilities, which includes a $7.5 million liability expected to be offset by an insurance recovery of $7.4 million. Accordingly, we have sufficient cash and working capital to fund our short-term liquidity requirements.

Previous wording

We anticipate that our most significant long-term liquidity and capital needs will relate to continued funding of operations, satellite development capital expenditures, launch capital expenditures, and ongoing investments to optimize our BlackSky Spectra software platform and corporate business and operational systems that will enable us to continue to scale the business efficiently and securely. These ongoing investments in our operational systems include a multi-year enterprise minimum commitment that is aligned with efforts to improve our operational infrastructure.

Current wording

We anticipate that our most significant long-term liquidity and capital needs will relate to continued funding of operations, including procurement of materials for our missions solutions programs, satellite development capital expenditures, launch capital expenditures, and ongoing investments to optimize our BlackSky Spectra software platform and corporate business and operational systems that will enable us to continue to scale the business efficiently and securely. These ongoing investments in our operational systems include a multi-year minimum commitment for compute/storage costs to facilitate our expanding AI/ML functionality.

Previous wording

Upcoming satellite development capital expenditures will include plans to expand our current high frequency monitoring constellation with multispectral, large-area collection satellites. These new satellites will be designed to support country scale digital mapping, navigation, maritime and 3D digital twin applications. We can manage the timing for a large part of our capital expenditures, including the design, build, and launch of our new satellites currently under development, to provide us with additional flexibility to optimize our long-term liquidity requirements. Macroeconomic conditions and credit markets could also impact the availability and/or the cost of potential future debt or equity financing.

Current wording

Upcoming satellite development capital expenditures include plans to expand our current high frequency monitoring constellation with multispectral, large-area collection satellites. We expect that these new satellites will be designed to support country scale digital mapping, navigation, maritime, and 3D digital twin applications. We can manage the timing for a large part of our capital expenditures, including the design, build, and launch of our new satellites currently under development, to provide us with additional flexibility to optimize our long-term liquidity requirements. Macroeconomic conditions and credit markets could also impact the availability and/or the cost of potential future debt or equity financing.

Previous wording

The following table provides a summary of cash flow data for the nine months ended September 30, 2025 and 2024. Our short-term liquidity at September 30, 2025 was $147.6 million. Short-term investments of $117.7 million are not classified as cash, cash equivalents, or restricted cash.

Current wording

The following table provides a summary of cash flow data for the three months ended March 31, 2026 and 2025. Our short-term liquidity at March 31, 2026 was $117.5 million. Short-term investments of $76.1 million are not classified as cash, cash equivalents, or restricted cash.

Previous wording

The change in net cash used in investing activities was primarily due to increased purchases of short-term investments in government securities of $120.5 million during the nine months ended September 30, 2025 compared to $13.5 million of purchases during the nine months ended September 30, 2024.

Current wording

The change in net cash used in investing activities was primarily due to increased net proceeds from short-term investments in government securities of $6.4 million during the three months ended March 31, 2026 as compared to $15.3 million of net purchases during the three months ended March 31, 2025.

Previous wording

We continue to have significant cash outflows for satellite procurement and launch related services and incur labor costs for internally developed capitalized software as we add innovative new services and tools to our BlackSky Spectra software platform and our corporate business and operational systems. The total amount paid for capital expenditures decreased during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decrease resulted from payments to BlackSky Satellite Systems, fka LeoStella, as a third party in 2024 as compared to the internal operation costs once the company was included in consolidated results in 2025 following the acquisition in the fourth quarter of 2024. We expect for cash outflows for satellite production to increase as we continue to build out our Gen-3 constellation.

Current wording

We continue to have significant cash outflows for satellite procurement and launch-related services. We also incur labor costs for internally developed capitalized software as we add innovative new services and tools to our BlackSky Spectra software platform and our corporate business and operational systems. The total amount paid for capital expenditures increased during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 primarily due to an increase in cash paid to procure direct materials and build our Gen-3 satellites, as well as for cash paid for launch insurance. We expect cash outflows for satellite production to increase as we continue to build out our satellite constellation.

Previous wording

Additionally, we received $40.8 million in proceeds from our equity issuances, net of equity issuance costs, in the nine months ended September 30, 2025 as compared to $47.3 million in the nine months ended September 30, 2024. Our equity issuances during the nine months ended September 30, 2025 consisted of the sale of 3.7 million shares under our ATM offering program which resulted in $42.5 million in gross proceeds, as compared to the sale of 0.5 million shares in the nine months ended September 30, 2024, which resulted in $4.8 million in gross proceeds. Our equity issuances during the nine months ended September 30, 2024 also included a public offering of 11.5 million shares of common stock resulting in $46.0 million in gross proceeds. We also received $10.8 million of proceeds from warrant exercises during the nine months ended September 30, 2025.

Current wording

We received $14.3 million in net cash proceeds from our equity issuances during the three months ended March 31, 2026 as compared to $5.1 million in net proceeds during the three months ended March 31, 2025. Our equity issuances during the three months ended March 31, 2026 consisted of the sale of 0.6 million shares of our Class A common stock under the 2025 ATM Agreement, which resulted in $15.0 million in gross proceeds. In comparison, for the three months ended March 31, 2025, we sold 0.6 million shares of our Class A common stock under our 2022 ATM Agreement, which resulted in $5.4 million in gross proceeds. The increase in gross proceeds was the result of an increase in our average stock price during three months ended March 31, 2026 as compared to the same period in 2025.

Previous wording

We evidence approval of the contract with the customer with dual signatures or approved purchase orders that detail the rights of each party and define payment terms. We have never had significant collection issues on contracts with new or recurring domestic and international government customers and we consider this historical trend when assessing the collectability risk for contracts with bespoke effective terms. We also consider the probability of the customer's funding the total contract value as a component of the collectability risk.

Current wording

We evidence approval of the contract with the customer with dual signatures or approved purchase orders that detail the rights of each party and define payment terms. We have never had significant collection issues on contracts with new or recurring domestic and international government customers and we consider this historical trend when assessing the collectability risk for contracts with bespoke effective terms. We also consider the probability of the customer funding the total contract value as a component of the collectability risk.

Previous wording

We execute contracts for a single promise or multiple promises. Specifically, our firm-fixed price contracts may include multiple promises which may be accounted for as separate performance obligations if they are capable of being distinct within the context of the contract. Significant judgment is required in determining performance obligations, including if some of the customized services are highly-interrelated, and these decisions could change the amount of revenue and profit or loss recorded in each period.

Current wording

We execute contracts for a single promise or multiple promises. Specifically, our firm-fixed price contracts may include multiple promises which may be accounted for as separate performance obligations if they are capable of being distinct within the context of the contract. Significant judgment is required in determining performance obligations and these decisions could change the amount of revenue and profit or loss recorded in each period.

Previous wording

We classify revenue as imagery and software analytical services, and professional and engineering services in our unaudited condensed consolidated statements of operations and comprehensive loss based on the predominant attributes of the performance obligations.

Current wording

We classify revenue as space-based intelligence & AI services, mission solutions, and advanced technology programs in our unaudited condensed consolidated statements of operations and comprehensive loss based on the predominant attributes of the performance obligations.

Previous wording

Each customer contract sets forth the transaction price for the products and services purchased under the arrangement. We estimate any variable consideration, and whether the transaction price is constrained, upon execution of each contract. Variable consideration is estimated as the most likely amount that is dependent upon the occurrence or non-occurrence of a future event. We continually review, and may reassess, the transaction price based on forecasted service level provisions within a limited amount of our customer purchase orders, costs incurred to date and historical experience. As a result, we may update our estimated constraints on revenue, which are generally on a prospective basis. For contracts with multiple performance obligations, we evaluate whether the stated selling prices for the products or services represent their standalone selling prices. When it is necessary to allocate the transaction price to multiple performance obligations, management uses the volume adjusted list price for imagery and analytics subscriptions and the expected cost plus a reasonable profit margin to estimate the standalone selling price of each product or service, which is mostly professional services.

Current wording

Each customer contract sets forth the transaction price for the products and services purchased under the arrangement. We estimate any variable consideration, and whether the transaction price is constrained, upon execution of each contract. Variable consideration is estimated as the most likely amount that is dependent upon the occurrence or non-occurrence of a future event. We continually review, and may reassess, the transaction price based on forecasted service level provisions within a limited number of our customer purchase orders, costs incurred to date and historical experience. As a result, we may update our estimated constraints on revenue, which are generally on a prospective basis. For contracts with multiple performance obligations, we evaluate whether the stated selling prices for the products or services represent their standalone selling prices. When it is necessary to allocate the transaction price to multiple performance obligations, management uses the volume adjusted list price for imagery and analytics subscriptions and the expected cost plus a reasonable profit margin to estimate the standalone selling price of each product or service, which is mostly professional services.

Previous wording

Imagery and analytics revenue is recognized ratably over the subscription period based on the promise to continuously provide contractual satellite capacity for tasked imagery or software analytical services at the discretion of the customer. Professional and engineering services revenue is generated from time and materials basis contracts, cost-plus contracts, firm-fixed price service solutions contracts and firm-fixed price long-term engineering and construction contracts. Due to the long-term nature of some of our engineering and construction contracts, we recognize revenue over time using a cost-to-complete measure of progress because it best depicts the transfer of control to the customer as we incur costs on the contracts. Under this measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the performance obligation(s). The estimation of total estimated costs at completion is subject to many variables and requires significant judgment. We recognize changes in the estimation of total costs at completion on a cumulative catch-up basis in the period in which the changes are identified. Such changes in estimates can result in the recognition of revenue in a current period for performance obligations which were satisfied or partially satisfied in a prior period. If at any time, the estimate of contract profitability indicates a probable anticipated loss on the contract, we recognize the total loss as and when known.

Current wording

Due to the long-term nature of some of our contracts, we recognize revenue over time using a cost-to-complete measure of progress because it best depicts the transfer of control to the customer as we incur costs on the contracts. Under this measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the performance obligation(s). Calculating total estimated costs at completion is subject to many variables and requires significant judgment. We recognize changes in the estimation of total costs at completion on a cumulative catch-up basis in the period in which the changes are identified. Such changes in estimates can result in the recognition of revenue in a current period for performance obligations that were satisfied or partially satisfied in a prior period. If, at any time, the estimate of contract profitability indicates a probable anticipated loss on the contract, we recognize the total loss as and when known.

Previous wording

We have equity and equity-based awards outstanding under our 2021 Equity Incentive Plan ("2021 Plan") and our 2014 Equity Incentive Plan ("2014 Plan"). Outstanding awards issued include stock options and restricted stock units ("RSUs"). In addition, our eligible employees are able to participate in our 2021 Employee Stock Purchase Plan ("ESPP") pursuant to purchase right offerings that are established under the ESPP.

Current wording

We have equity and equity-based awards outstanding under our 2021 Equity Incentive Plan ("2021 Plan") and our 2014 Equity Incentive Plan ("2014 Plan"). Outstanding awards issued include stock options and RSUs. In addition, our eligible employees can participate in our 2021 Employee Stock Purchase Plan ("ESPP") pursuant to purchase right offerings that are established under the ESPP.