Rocket Lab: Q3 2025 Earnings

Rocket Lab’s (RKLB) stock experienced a surge of up to 3% on Tuesday following the release of its third-quarter results, which showcased record revenues driven by a burgeoning launch contract portfolio and advancements in its space technology offerings.

The company reported Q3 revenue of $155 million, exceeding analysts’ projections of $152 million as polled by LSEG, and marking a robust 48% year-over-year increase from $105 million. Furthermore, Rocket Lab reported a loss of 3 cents per share, significantly less than the anticipated 10-cent loss per share. Revenue was propelled by both increased launch activity and heightened demand for its space systems segment, reflecting the company’s diversified revenue streams.

Bolstering investor confidence, Rocket Lab provided strong guidance for the current quarter, projecting revenues between $170 million and $180 million, surpassing analysts’ consensus estimate of $172 million. This positive outlook underscores the company’s strong momentum and its ability to capitalize on growing opportunities in the space sector. The guidance does bake in some modest growth in launch tempo, however, the mix of launch services and space systems sales will be critical to achieving these numbers.

Rocket Lab currently boasts a record backlog of 49 contracted rocket launches. Notably, the company secured 17 of these deals during the third quarter and is on track to conclude the year with over 20 launches in total. This robust backlog provides substantial revenue visibility and underscores the company’s increasing prominence in the competitive launch services market. This backlog reflects a growing market demand, but also highlights Rocket Lab’s capability in securing contracts, even amongst increasing competition.

According to CEO Peter Beck, the company is on the cusp of achieving a new annual launch record. Beyond launch services, Rocket Lab is actively pursuing mergers and acquisitions to expand its capabilities in key defense initiatives, including technologies relevant to missile defense systems. Such strategic moves indicate the company’s ambition to broaden its market presence and contribute to critical national security objectives. Specifically, many expect Rocket Lab to be expanding its photonic and sensor capabilities to match the ever growing demand from the military and intelligence community.

Competition within the space technology sector is intensifying, with the U.S. government and NASA increasingly relying on independent contractors to facilitate missions. Companies such as SpaceX are playing pivotal roles in lunar return initiatives and other ambitious space exploration programs. This influx of activity has attracted a wave of space companies to the public markets, creating a dynamic and rapidly evolving landscape.

Shares witnessed a surge of over 31% last month following the announcement of several new launch deals, highlighting the market’s positive reception of the company’s growth trajectory. Year-to-date, the stock has more than doubled and has soared by almost 270% over the trailing twelve months, even after a slight pullback in November amid broader market volatility. This pullback in November is likely connected to general market volatility with global economic slowdown concerns, and is not specific to Rocket Lab’s operations. It’s important to note space operations are considered long time horizon investments which are prone to volatility from macroeconomic factors.

During the third quarter, Rocket Lab completed its acquisition of satellite sensor maker Geost and inaugurated a new launch site for its Neutron rocket, signifying strategic expansion across various segments of the space value chain. The Geost acquisition allows further vertical integration, creating more control over the entire value chain and increasing profit margins in the long run; the Neutron launch site is a strong signal that the company is betting on heavier delivery vehicles to cater to future customer demand.

Rocket Lab reported an adjusted EBITDA loss of $26.3 million, exceeding the initially projected loss range of $21 million to $23 million. Analysts anticipated an adjusted EBITDA loss of $22.2 million, according to FactSet. The relatively large loss is concerning to investors, however, it is indicative of the increased costs of operation from supply chain constraints and from increased staffing to fulfill a larger contract volume.

For the fourth quarter, the company anticipates adjusted EBITDA losses to range between $23 million and $29 million, surpassing FactSet’s forecast of a $13 million loss. These losses likely point to continued investments in growth initiatives and infrastructure to support the company’s long-term objectives. Furthermore, the adjusted EBITDA does not include potential further acquisitions that may impact the financials if Rocket Lab were to deploy more invested capital.