Terran Orbital’s Billion-Dollar Deal Insights On Funding And Future Prospects

Terran Orbital, a key player in the space technology domain, appears to be on the cusp of a significant financial breakthrough. Reports suggest that its major customer, Rivada Space Networks, is finalizing funding for a multibillion-dollar mega-constellation project, solidifying a crucial partnership between the two entities.

The CEO of Terran Orbital, Marc Bell, conveyed the optimistic news during an internal company meeting earlier this month. While the company is actively pursuing various high-value contracts, the $2.4 billion deal with Rivada stands as the largest in Terran’s history. However, earlier in the quarter, the company had to revise its financial projections after a delay in an incremental payment of $180 million from Rivada.

During the meeting, Bell shared insights from a recent conversation with Rivada’s CEO, Declan Ganley, indicating that the funding closure was imminent. Despite the anticipated Christmas timeline passing without public announcements, Bell expressed confidence in the imminent financial close and emphasized its positive impact on the company’s shares and financial performance.

Rivada, a subsidiary of Rivada Networks, initially contracted Terran to develop 300 satellites for the mega-constellation under a $2.4 billion agreement. Additionally, Rivada has a separate partnership with SpaceX for satellite launches, scheduled to commence in April 2025.

However, despite the positive outlook conveyed during the meeting, both companies are yet to make any official statements regarding the funding developments. Bell highlighted the necessity of a contract modification that might affect payment terms and the timing of public announcements.

In an investor call last month, Bell expressed surprise at the funding delays, attributing Rivada’s funding source to a presumed large sovereign wealth fund. He reiterated the expectation of eventual closure of the funding.

As of the latest reports, Terran Orbital’s backlog of future work stands at $2.6 billion, with the Rivada contract contributing $2.4 billion. Despite the delay in the expected milestone payment, Bell remains optimistic about the company’s revenue projection for the year, anticipating a significant increase from the previous year’s earnings.

Moreover, Terran is actively pursuing other lucrative contract opportunities, including involvement in the Space Development Agency’s constellation project named “Proliferated Warfighter Space Architecture.” The company has already delivered satellites for Tranche 0 and is currently engaged in building satellite buses for subsequent tranches.

Bell also hinted at the potential privatization of Terran Orbital, envisioning a transition to a traditional public offering following a period of private ownership to reposition the company in the market.

Terran Orbital’s stock price, however, has experienced a substantial decline since its public debut via a SPAC reverse merger in March last year. Despite the initial stock price of $10.96, the current trading price hovers around $1.22.

The unfolding developments between Terran Orbital and Rivada Space Networks paint a dynamic picture of the evolving space technology sector, characterized by lucrative contracts, funding intricacies, and strategic business maneuvers. As both companies navigate these critical phases, the industry eagerly awaits further announcements that could reshape the future of satellite technology and space exploration.