Key Highlights
- The satellite imaging company delivered Q2 revenue of $116.1 million, surpassing Wall Street’s $104.5 million projection, marking a 58% increase from the prior year.
- The company’s adjusted EBITDA reached $13.9 million, significantly exceeding the consensus forecast of $2.3 million.
- Revenue from defense and intelligence operations now represents 70% of total sales, compared to 57% in the same period last year, climbing to approximately $81 million.
- The company’s Q3 revenue forecast of $101 million to $105 million fell short of analysts’ $114 million expectations.
- Shares traded approximately 11% higher in premarket activity Friday at $20.44, rebounding from Thursday’s more than 8% decline.
The satellite imaging provider announced second-quarter revenue of $116.1 million, representing a 58% year-over-year increase and easily surpassing the Street’s $104.5 million projection. The company’s adjusted EBITDA of $13.9 million substantially exceeded expectations of $2.3 million.
Non-GAAP earnings per share registered at 2 cents, compared to analyst estimates calling for a loss of 2 cents per share. The results represented comprehensive outperformance across key metrics.
The defense and intelligence segment experienced explosive growth, climbing more than 90% year over year and expanding its share to 70% of overall revenue from 57% twelve months earlier. In absolute terms, defense-related revenue approached $81 million, nearly doubling from the previous year.
The commercial segment posted growth exceeding 15%, while civil government revenue expanded by more than 5%. From a regional perspective, Europe, the Middle East, and Africa demonstrated exceptional performance with revenue surging over 130%.
The company secured an $8 million agreement with the National Geospatial-Intelligence Agency for its Global Monitoring Service. Additionally, Planet Labs won a seven-figure European defense contract and successfully bid on a German government satellite-services tender valued at up to 25 million euros spanning five years.
The company’s backlog increased 11% year over year to $815 million. Remaining performance obligations grew 9% to approximately $753 million. Management anticipates recognizing over $400 million in revenue during the next four quarters based on current backlog.
Third Quarter Outlook Falls Short
Management issued Q3 revenue guidance ranging from $101 million to $105 million, trailing the $114 million analyst consensus. The company also projects a Q3 EBITDA loss of approximately $3.5 million, while the Street had anticipated positive EBITDA of $2.5 million.
Citi analyst John Godyn observed that a portion of the Q2 outperformance stemmed from revenue pulled forward from Q3, accounting for some of the guidance miss. He maintained that the investment case remains “intact.”
Needham analyst Ryan Koontz highlighted that Q2 revenue benefited from earlier-than-anticipated recognition related to Sweden’s inaugural sovereign satellite. The combined Q2 results and Q3 guidance still reflected 42% year-over-year revenue growth.
Fiscal Year Projections
Planet Labs lifted the lower bound of its fiscal 2027 revenue guidance to $430 million from $425 million, while maintaining the upper end at $441 million. Wall Street consensus currently stands at $435.67 million.
Management is pursuing the Rule of 40 metric for fiscal 2027, calculated by combining revenue growth rate with adjusted EBITDA margin.
Adjusted gross margin decreased modestly to 59% from 61% in the prior-year period, reflecting investments in satellite services agreements and AI-powered partner solutions.
Through the first half of the fiscal year, the company produced approximately $68 million in operating cash flow. Free cash flow totaled $21 million, while adjusted free cash flow hit $29 million.
The company closed the quarter with roughly $865 million in cash and short-term investments, having raised approximately $120 million through its at-the-market program at an average net price of $31.95 per share.
Management has identified over $4 billion in potential satellite-services opportunities within its sales pipeline.
Shares traded down approximately 1.25% at $18.12 at publication time Friday, following the morning’s 11%-plus premarket gain. The stock has appreciated more than 180% during the trailing twelve-month period.
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