Rocket Lab (RKLB, Financial) successfully conducted its third mission for its Japanese partner, the Institute for Q-shu Pioneers of Space (iQPS). The mission, titled "The Sea God Sees," launched from Rocket Lab Launch Complex 1 in Mahia, New Zealand, at 8:17 p.m. local time on May 17, 2025. This operation placed the QPS-SAR-10, a synthetic aperture radar satellite, into a 575km low Earth orbit to enhance iQPS's satellite network.
This launch follows closely on the heels of Rocket Lab's previous deployment for iQPS on March 15, 2025, emphasizing the company's ability to provide frequent and reliable satellite launches with consistent success. This recent mission marks the third launch for iQPS and is the second of an eight-mission contract scheduled for 2025 and 2026. Four more launches are planned for this year, with the remaining two set for the next.
Rocket Lab's next mission for iQPS is anticipated to occur in less than a month, aiming for a June 2025 launch. This stream of successful missions highlights Rocket Lab's proficiency in supporting satellite operators with dedicated and reliable launch capabilities.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 13 analysts, the average target price for Rocket Lab USA Inc (RKLB, Financial) is $25.65 with a high estimate of $33.00 and a low estimate of $16.00. The average target implies an upside of 0.33% from the current price of $25.57. More detailed estimate data can be found on the Rocket Lab USA Inc (RKLB) Forecast page.
Based on the consensus recommendation from 16 brokerage firms, Rocket Lab USA Inc's (RKLB, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Rocket Lab USA Inc (RKLB, Financial) in one year is $15.71, suggesting a downside of 38.56% from the current price of $25.57. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Rocket Lab USA Inc (RKLB) Summary page.
RKLB Key Business Developments
Release Date: May 08, 2025
- Revenue: $122.6 million, up 32% year-over-year.
- Launch Services Revenue: $35.6 million.
- Space Systems Revenue: $87 million.
- Gross Margin (GAAP): 28.8%.
- Gross Margin (Non-GAAP): 33.4%.
- Total Backlog: $1.067 billion.
- Launch Backlog: $422.2 million.
- Space Systems Backlog: $644.8 million.
- Operating Expenses (GAAP): $94.4 million.
- Operating Expenses (Non-GAAP): $76.8 million.
- R&D Expenses (GAAP): Increased by $6.9 million quarter-on-quarter.
- R&D Expenses (Non-GAAP): Increased by $4 million quarter-on-quarter.
- Cash and Equivalents: $517 million at the end of Q1 2025.
- Adjusted EBITDA Loss: $30 million.
- Q2 2025 Revenue Guidance: $130 million to $140 million.
- Q2 2025 Gross Margin Guidance (GAAP): 30% to 32%.
- Q2 2025 Gross Margin Guidance (Non-GAAP): 34% to 36%.
- Q2 2025 Adjusted EBITDA Loss Guidance: $28 million to $30 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Rocket Lab USA Inc (RKLB, Financial) reported a near-record quarterly revenue of $122.6 million, marking a 32% increase compared to the previous year.
- The company successfully launched five Electron missions with 100% mission success, demonstrating reliable access to space.
- Rocket Lab USA Inc (RKLB) has been selected for the Department of Defense's high-value launch contract in the National Security Space Launch (NSSL) program, highlighting its capability as a launch provider.
- The company is expanding its vertical integration with the acquisition of Mynaric, which specializes in laser-based satellite communications, enhancing its product offerings.
- Rocket Lab USA Inc (RKLB) is making significant progress with its Neutron launch vehicle, targeting its first launch in the second half of the year, which is expected to drive future growth.
Negative Points
- The company experienced a sequential decline in revenue of 7.4% due to a mix of lower-priced Electron missions and a reduction in component businesses.
- Rocket Lab USA Inc (RKLB) reported a negative GAAP operating cash flow of $54.2 million in the first quarter, driven by lumpy cash receipts and continued investment in Neutron.
- The company faces challenges with production and supply chain issues, particularly highlighted in its acquisition of Mynaric.
- There is a high level of fixed overhead and expenses associated with maintaining launch operations, impacting profitability when launch cadence is not optimized.
- Rocket Lab USA Inc (RKLB) is experiencing elevated levels of negative free cash flow, expected to continue until the first launch of Neutron is achieved.
