WASHINGTON — Astroscale has finalized a contract with the Japanese space agency JAXA for a mission to remove a defunct upper stage from Earth orbit.
The Tokyo-based company said in an Aug. 19 regulatory filing that the company’s board has approved a contract with JAXA for the Active Debris Removal by Astroscale-Japan 2 (ADRAS-J2) mission, valued at 12 billion yen ($82.1 million). Astroscale announced in April that it had been selected by JAXA for the mission but did not disclose the value of the award at the time.
ADRAS-J2 will go to the same H-2A upper stage, left in orbit after a 2009 launch, that is currently being inspected by the company’s ADRAS-J spacecraft. ADRAS-J has approached to within 50 meters of the stage and flown around it to assess the stage’s condition.
ADRAS-J2, the second phase of JAXA’s Commercial Removal of Debris Demonstration (CRD2) program, will return to that stage and grapple it, then lower its orbit for disposal. Astroscale did not disclose in the announcement when ADRAS-J2 would launch, but a slide in a business update presentation by the company, also released Aug. 19, projected a launch in the company’s 2028 fiscal year, which ends in April 2028.
The contract value is slightly higher than what Astroscale anticipated. Nobu Matsuyama, chief financial officer of the company, said in an Aug. 19 presentation that the company had projected the contract to be worth 11.4 billion yen, but did not explain what caused the increase.
The ADRAS-J2 contract is a major boost to the company’s contracted backlog, which stood at 5.4 billion yen as of April, according to the presentation. Astroscale’s subsidiary in the United Kingdom also finalized a contract in July for the final phase of the ELSA-M satellite deorbiting mission that added more than 2.3 billion yen to that backlog.
The company expects to convert that backlog into revenue over the next few years. Astroscale had income, which it stated includes contract revenue and government grants, of nearly 4.7 billion yen in the 2024 fiscal year that ended in April. It is forecasting income of 18 billion yen in 2025.
Astroscale went public in June on the Tokyo Stock Exchange Growth Market, raising 20.1 billion yen at a share price of 850 yen. Shares soared the day of the initial public offering, going as high as 1,581 yen, but fell in the following weeks, reach a low of 513 yen in early August before rebounding to about 1,000 yen.
With the scrutiny of the public markets, Astroscale is turning its focus on profitability. “We are aiming for an operating profit close to breakeven in fiscal year 2026 through further growth,” Nobu Okada, chief executive and founder of Astroscale, said at the briefing.
Matsuyama said later in the briefing that gross profit should come close to breakeven in the 2025 fiscal year, although with an operating loss that will be bigger than the 11.5 billion yen recorded in 2024. He said that will improve as the company’s research and development costs decline, adding that the company’s cash balance should be sufficient to get the company to breakeven without addition equity raises.
The company is charting additional revenue opportunities, such as with deorbit services for the first-generation OneWeb constellation. Matsuyama noted 568 OneWeb satellites have docking plates that enable them to be removed by servicing spacecraft based on Astroscale’s ELSA-M mission. He said Astroscale estimates that seven to eight percent of the OneWeb satellites will not be able to deorbit on their own, requiring services at a price of $8 million to $13 million each, or a total revenue of as high as $585 million.
Chris Blackerby, chief operating officer of Astroscale, noted in the briefing that consulting firm NSR estimated that the overall on-orbit service market was valued at $3.1 billion over the next decade in a 2020 study, but grew to $18.2 billion in its most recent report earlier this year. “At Astroscale, we’re looking at a target market share of over 50%,” he said.