Sidus Space, Inc. (SIDU) stock experienced a significant decline on Tuesday after the company announced plans to raise capital through a share offering. In an SEC filing, Sidus Space disclosed its intent to sell 3.75 million shares at an assumed price of $2.67 per share. This offering also includes up to 3.745 million pre-funded warrants for the purchase of up to 3.745 million shares of Class A common stock. The company anticipates generating approximately $8.9 million in net proceeds from this offering, which will be allocated towards various strategic initiatives, including sales and marketing, operational costs, product development, manufacturing expansion, working capital, and general corporate purposes.
Despite the share offering news, there was a glimmer of positive news for Sidus Space. The company also announced that the U.S. Federal Communications Commission (FCC) had granted approval for its operation of a micro constellation of remote sensing, multi-mission satellites in Low Earth Orbit (LEO). This regulatory milestone marks a significant step forward in Sidus Space’s expansion plans and signifies its commitment to enabling new missions and delivering flexible, cost-effective data acquisition solutions through its innovative data-as-a-service model. Notably, Sidus Space retains ownership of the data collected by its LizzieSat sensors for all missions, providing its customers with a distinctive advantage in accessing valuable data streams.
The FCC approval represents a pivotal moment for Sidus Space as it increases its on-orbit presence and enhances its capacity to provide various industries with improved real-time, space-based data services. However, the impact of the share offering has weighed heavily on the stock, resulting in a substantial loss of over 79% in the past year. On Tuesday, SIDU shares traded down 11.2% to $2.335 at last check.
Investors will be closely watching to see how the market reacts to both the share offering and the FCC approval. The future trajectory of Sidus Space’s stock will likely be influenced by the company’s ability to execute on its growth plans and capitalize on the growing demand for space-based data services.