AST SpaceMobile secured a contract with the Space Development Agency (SDA) late Wednesday. ASTS stock jumped at Thursday's open before falling back to earth.
Midland, Texas-based AST SpaceMobile is building a space-based cellular broadband network, differentiated by its ability to enable everyday smartphones to connect to orbiting satellites. The company's goal is to provide connectivity worldwide at 4G/5G speeds for both government and commercial applications.
AST SpaceMobile late Wednesday announced it was selected as a prime contractor by the SDA to compete for upcoming prototype demonstration projects under the Hybrid Acquisition for proliferated Low-earth Orbit (HALO) program. The HALO program focuses on satellite development, and allows the SDA and Department of Defense to test and assess various technologies before committing to future orders.
Under the program, vendors compete for demonstration and experimentation task orders that will support future tranches of the SDA's Proliferated Warfighter Space Architecture — a large satellite network to enhance military communications and missile tracking capabilities.
The SDA selected a pool of 19 vendors, including AST SpaceMobile, for the round of demonstrations. The nontraditional vendors also include Airbus U.S. Space & Defense, Apex Technology, Astro Digital, and Momentus.
Financially, the contracts are modest, with the SDA providing each vendor $20,000 as part of the initial agreement to assist with administrative and travel expenses.
But it follows AST SpaceMobile's successful Sept. 12 launch of its first five commercial BlueBird satellites with its partner SpaceX. AST SpaceMobile could eventually include 168 satellites in its constellation, according to reports.
Meanwhile, AST SpaceMobile's satellites have some overlap and competition with SpaceX subsidiary Starlink.
AST SpaceMobile Stock
ASTS stock jetted nearly 16% higher Thursday on the news, retaking its 50-day moving average and topping an early entry at 29.61. However, the stock reversed to close with a 4.5% decline at 25.07.
Shares have pulled back about 36% from an August high. They are still up more than 315% so far this year.
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