Ladies and gentlemen, thank you for standing by. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the NextNav Fourth Quarter 2024 Earnings Conference Call [Operator Instructions]. And I would now like to turn the conference over to [Nevan Riley]. You may begin.

Good afternoon, everyone. And welcome to NextNav's fourth quarter conference call. Participating on today's call are Mariam Sorond, NextNav's Chief Operating Officer and Chief Executive Officer; and Chris Gates, NextNav's Chief Financial Officer. Before we begin, let me remind everyone that this call will include certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by use of words such as may, anticipate, believe, expect, intend, might, plan, possible potential, aim, drive, predict, project, should, could, would, will, and similar expressions may identify forward-looking statements but the absence of these words does not mean that the statements are not forward-looking. Such forward-looking statements, which may relate to NextNav's forecast of future results, future prospects, developments and business strategies are subject to known and unknown risks, uncertainties and assumptions and other important factors, many of which are outside NextNav's control that could cause actual results to differ materially from the results discussed in forward-looking statements. In particular, such forward-looking statements include the achievement of certain FCC related milestones and FCC approvals, the ability to realize and broaden spectrum capacity and the advancement of NextNav's terrestrial 3D PNT services. NextNav is positioned to drive growth in its 3D geolocation business, an expansion of its next generational terrestrial 3D PNT technologies. The business plans, objectives, expectations and intentions of NextNav and NextNav's estimated and future business strategies, competitive position, industry environment, potential growth opportunities, revenue, expenses and profitability. These statements are based on NextNav management's current expectations and beliefs as well as a number of assumptions concerning future events. You are cautioned not to place undue reliance upon the forward looking statements, which speak only as the date made and NextNav undertakes no commitment to update or revise the forward looking statements, whether as a result of new information, future events or otherwise. For additional information regarding risk factors read Part 2, Item 1A, Risk Factors of the company's quarterly reports on Form 10 Q, Part 1, Item 1A, Risk Factors of NextNav's annual report on Form 10-K for the year ended December 31, 2024, as well as those otherwise described or updated from time to time in our other filings with the Securities and Exchange Commission. Following our prepared remarks, the company will host an operator led question and answer session. In addition, at the conclusion of today's call, a replay of our discussion will be posted to the company's Investor Relations Web site. I'd now like to turn the call over to Ms. Mariam Sorond, Chief Executive Officer of NextNav. Please go ahead, Mariam.

Thank you, [Nevan]. Good afternoon. And thank you, everyone, for joining us today. I would like to begin today's call with an update on the business and our latest steps with the FCC. I will then turn things over to Chris to provide an update on our financials. 2024 was a transformational year for NextNav, and I am pleased with all that we have accomplished. We have made significant progress in advancing our vision for a threshold complement and backup to GPS, leveraging strategic regulatory, technological and financial milestones to strengthen our position. Following our agreement to acquire spectrum licenses covering an additional 4 megahertz and lower 900 megahertz band last March, we moved quickly to file a petition for rule making with the FCC. Our petition, which seeks to unlock spectrum for a nationwide threshold PNT network, took a crucial step forward in August when the FCC issued a public notice inviting public comment. Since that time, we have received strong support from public safety organizations, industry stakeholders and government agencies recognizing the urgent need for a resilient complement and backup to GPS. Recently, Convey911 filed in support of the NextNav petition and the Texas 9-1-1 Alliance and the Nevada Division of Emergency Management, each recently filed in support of the commission moving forward to explore solutions that address the limitations of GPS. NextNav has been actively holding engineer to engineer discussions to address concerns and refine its proposals. Notably, we are actively engaged with key stakeholders, including the NTIA, the Association of American Railroads and tolling operators to address coexistence concerns and technical considerations. To date, these conversations have been highly productive. We are working with MxV, a subsidiary of the Association of American Railroads, to gather the necessary information about railroad equipment and developing a joint test…

Thanks Mariam. And good afternoon, everyone. I'll first address our financial performance for the fourth quarter and fiscal year 2024 and then provide some details on the note purchase agreement Mariam just referenced. Beginning with the top line, NextNav's revenue in the fourth quarter was $1.9 million, a $0.7 million increase from $1.2 million in the prior year period. For the 12 month period, revenue was $5.7 million, a $1.8 million increase from $3.9 million in 2023. The increase in both the three and 12 month period was primarily driven by our previously announced one year DOT contract and a one time license fee earned in the fourth quarter of our soft GPS technology. Operating expenses for the fourth quarter were $16.7 million, down approximately $4.5 million versus the same period last year. Operating expenses included $1.3 million in depreciation and amortization and $2.7 million in equity compensation compared to $1.3 million in depreciation and amortization and $9.2 million in equity compensation in the fourth quarter of 2023. In the 12 month period, operating expenses were $65.8 million as compared to $67.4 million in 2023. Excluding stock based compensation expenses and depreciation and amortization, operating expenses were $46.7 million in 2024 and $40.7 million in 2023. Net loss for the fourth quarter was $32.3 million, which included a $14.9 million loss associated with the change in the fair value of warrants and liability associated with [Telesource] asset purchase agreement. This is compared to a net loss of $16.4 million in the fourth quarter of 2023, which included a gain on the change of the fair value of our warrant liability of $5.7 million. For the full year, net loss was $101.9 million, including a $32.2 million loss associated with the change in the fair value of warrant liability net of…

Thank you. And we will now begin the question-and-answer session [Operator Instructions]. And your first question comes from the line of Mike Crawford with B. Riley Securities.

That's a lot to digest today, but just to look at the bigger picture. Can you talk about what might be capital cost to deploy a 5G network with the timing signal propagated per your IP as you're pursuing in the NPRM and who might bear this capital cost?

As we've said previously in our petition, it will be a 5G operator who will be building this network. And because we are using a standards based 5G PRS solution, we don't see major cost in addition to what the 5G network cost would be for the operator to deploy. They add spectrum to their bands all the time, they need 5G spectrum and this is standards based. Our solution is software sitting on top of it.

So could the software sit on top of existing radios and towers or would there need to be all new infrastructure put in by the operator?

I mean, the operators have existing towers and radio equipment but every time that an operator adds a new spectrum band, there's new radios to be added. They do this all the time. I mean, they're going to continue to build out more spectrum as capacity demand grows and they're going to continue to add whatever there needs to be added to their existing towers and infrastructure. Our software is completely capable and this is what actually we just demonstrated through our technology trials that it could take an existing 5G PRS based signal that's transmitting from the operator's network as they would deploy any 5G new spectrum and provide accurate positioning and timing.

And then my one follow up question would be what potential uses of capital would you have beyond just headcount and legal, et cetera, as you progress toward getting a report in order?

Chris, do you want to take that one?

And I think you're getting to some extent of course that the financial flexibility that we're building into our balance sheet with this new notes issue that we just signed. Obviously, one of the things that we've been able to achieve is to move the maturity of any potential notes well into mid 2028. But at the same time, we've significantly enhanced the flexibility of capital in our balance sheet and that of course provides us with substantial long term liquidity. And it also allows us to approach not only our existing capital structure but our business opportunities as we kind of look into 2025 and pursue our objectives with a great deal of flexibility. And I'm going to use that word a couple different times there. The other thing that I would highlight, and I think Mariam mentioned this, is that our business plan continues to not require the deployment of a network by ourselves. We intend to partner with third parties in the future for network deployment. And so we're not provisioning in advance of like a major network or CapEx build out program.

And ladies and gentlemen, that concludes our question-and-answer session. I will now turn the conference back over to Mariam Sorond for closing remarks.

Thank you all for joining us today. And as we look ahead, we're committed to advancing geolocation services that will enhance national security, public safety and economic resilience. And we are super excited for 2025 as our momentum proposals forward. We are looking forward to connecting with you next quarter.

And ladies and gentlemen, this concludes today's call and we thank you for your participation. You may now disconnect.