After nearly a year of struggling to bump its stock price above the Nasdaq minimum and avoid delisting, Astra ($ASTR) has officially decided to perform a reverse stock split.
The company plans to perform a 1-to-15 ratio split and aims to raise up to $65M in an “at-the-market” offering, meaning common stock shares will sell at their current price. Astra’s board approved the plan on July 6 and filed with the SEC on Monday. The split is expected to occur by Oct. 2.
- A reverse stock split will raise the per-share price but won’t affect the company’s market cap, currently sitting at ~$102M.
Rocky road: Astra went public during the SPAC boom of 2021 at a valuation of nearly $2B. Following a high-profile launch failure of Rocket 3 in 2022, the company took a prolonged hiatus from launch to focus squarely on the planned Rocket 4. Since then, the company’s cash reserves have been falling fast.
- $ASTR reported $62.7M cash on hand in Q1 2023, down from $102.8M at the end of 2022.
- Between Q4 ‘22 and Q1 ‘23, the company pulled in $0 in revenue.
- Execs said in May that they were projecting $30-33M of cash remaining at the end of Q2.
The launcher isn’t giving up yet, though. Proceeds from the reverse stock split will be used to press ahead on Rocket 4 development, tracking towards a debut launch next year, and to continue producing its electric thrusters.
+ Market check: As of EOD Tuesday, Astra stock was trading at $0.38.