Rocket-lab (RKLB) Q2 2025 Earnings Overview
Rocket Lab’s stock has skyrocketed over the past year, soaring an incredible 700%.
This remarkable surge is driven by a combination of factors, including an accelerated launch cadence, significant contract wins, and growing excitement around the company’s upcoming Neutron rocket.
Beyond these strong fundamentals, the rally has also been fueled by a broader investor rotation into aerospace companies that are insulated from tariffs, as well as political headwinds facing SpaceX, which have shifted attention toward Rocket Lab.
This overview will provide a detailed breakdown of Rocket Lab’s recent earnings progress and outline our updated price target for the stock.
Rocket Lab’s impressive 700% stock surge reflects a mix of recent strong execution and promising future potential.
While current fundamentals are still largely driven by the Electron rocket, investor enthusiasm is firmly centered on Neutron, Rocket Lab’s next-generation satellite launch vehicle.
Neutron represents a pivotal step in Rocket Lab’s evolution, shifting from small satellite launches to handling heavier payloads and securing high-value national security contracts.
This new vehicle builds on Electron’s proven track record which boasts three times more successful launches than all other American small launch providers combined over the past decade.
If Neutron delivers as expected, it could become the first credible competitor to SpaceX’s Falcon 9 in the medium-lift launch market.
This would break SpaceX’s near-monopoly and significantly expand Rocket Lab’s total addressable market.
Similar to our approach with Palantir’s earnings overview, we’ll present two price targets reflecting both bullish and bearish scenarios.
In the best-case scenario, if Neutron launches on schedule and performs well, the stock could rally substantially potentially surpassing $75 per share.
Conversely, any delays or setbacks with Neutron could drive the stock below $25, reflecting the market’s sensitivity to this critical growth catalyst.
Second Quarter 2025 Business Highlights and Recent Updates through June 30, 2025:
Rocket Lab successfully completed five Electron rocket launches during the quarter, including a record-setting achievement of two launches just two days apart from the same site at Rocket Lab Launch Complex 1.
The total number of Electron launches now stands at 69.
The company secured new Electron launch contracts with multiple international space agencies, reinforcing Rocket Lab’s reputation as a trusted launch provider for the U.S. government and allied partners worldwide.
Progress on Launch Complex 3, the dedicated launch, test, and landing facility for Rocket Lab’s reusable Neutron rocket, remains on schedule, with completion and official opening expected in Q3 2025.
Rocket Lab established a new Payloads business unit to strengthen its positioning for future defense satellite contracts.
This move coincides with the pending acquisition of Geost, valued at $275 million in a cash-plus-equity deal, including a potential time-based revenue earnout of up to $50 million.
The company has begun production on its $515 million contract to build a constellation of 18 spacecraft for the Space Development Agency’s Tranche 2 Transport Layer, following confirmation that Rocket Lab’s spacecraft design, manufacturing, and system architecture meet the agency’s mission requirements.
Rocket Lab is aiming for a first launch of its Neutron rocket by the end of the year, but company executives caution that the schedule leaves no room for error.
CEO Peter Beck emphasized a cautious approach, stating, “We’re not going to rush and take stupid risks to get a launch of Neutron before it’s ready.
In the context of the vehicle’s lifecycle and program, a couple of months here or there is completely irrelevant.” He added, “There’ll be no cutting corners here to just rush to the pad for an arbitrary deadline.”
While Beck didn’t specify any particular issues that could delay the launch into next year, he noted ongoing work to mitigate risks related to the rocket’s propulsion system, as well as integration and testing of the first stage.
Rocket Lab has developed the necessary infrastructure for Neutron, including production and test facilities. The company currently produces one Archimedes engine every 11 days and conducts three to four engine tests daily, some lasting a full mission duration.
The Neutron launch pad, Launch Complex 3 at Wallops Island, Virginia, is nearing completion, with a ribbon-cutting ceremony scheduled for August 28. Beck highlighted the pad’s national significance, pointing out launch bottlenecks at other sites and underscoring the importance of launch site diversity.
Regarding launch cadence, Rocket Lab plans a gradual increase: one Neutron launch in the first year, followed by three in the second year, and five in the third. Beck explained that the schedule allows time to incorporate learnings between flights, dismissing any plans to accelerate the timeline.
Beck set a high standard for Neutron’s debut flight: “You’re not going to hear some rubbish about just clearing the pad is a success. For us, a successful launch of Neutron will be successfully getting to orbit.”
Rocket Lab USA, Inc. reported mixed results for the second quarter, posting earnings per share (EPS) of -$0.13 alongside a robust 36% year-over-year revenue increase to $144.5 million.
The strong revenue growth was primarily fueled by heightened launch activity, including five Electron missions during the quarter, as well as ongoing expansion in satellite manufacturing and component production. However, the company’s net losses widened significantly, increasing by 59.5% to $66.4 million, marking the fifth consecutive year of operating in the red.
Rocket Lab has demonstrated strong gross margin expansion and achieved another record revenue quarter, driven by solid operational execution and program delivery. This momentum positions the company well for what could be a record-setting year in both launches and spacecraft deliveries. The quarter was also marked by significant M&A activity, notably the progress on the acquisition of Geost. This move strengthens Rocket Lab’s ability to provide comprehensive mission solutions across launch, spacecraft, and now payloads, aligning well with defense initiatives such as the Golden Dome program. The company is confident that these strategic investments will unlock new growth opportunities and help pave the way toward sustained profitability, as it looks ahead to a potential record third quarter.
Third Quarter 2025 Guidance
For Q3 2025, Rocket Lab projects:
Revenue in the range of $145 million to $155 million
GAAP gross margins between 35% and 37%
Non-GAAP gross margins between 39% and 41%
GAAP operating expenses ranging from $104 million to $109 million
Non-GAAP operating expenses between $86 million and $91 million
Net interest expense of approximately $1.3 million
Adjusted EBITDA loss estimated between $21 million and $23 million
Basic weighted average common shares outstanding at 528 million, which includes roughly 46 million Series A Convertible Participating Preferred Shares.
Rocket Lab, like many U.S. space industry players, is exploring its potential role in the $175 billion Golden Dome missile defense system, even though details about the system’s design remain limited.
CEO Beck highlighted that “The Golden Dome program could become one of the Department of Defense’s largest procurements ever, and Rocket Lab is well-positioned to capitalize on opportunities here.”
A critical element supporting this positioning is Rocket Lab’s pending acquisition of Geost, a manufacturer specializing in sensor payloads for military spacecraft. The deal has successfully cleared antitrust review and is expected to close shortly. Beck noted, “This acquisition will secure the domestic supply chain for essential technology in next-generation missile defense initiatives.”
Beyond supplying sensors or missile-warning satellites, Rocket Lab anticipates broader involvement, including utilizing both its Electron and Neutron rockets, along with ongoing contracts to build communications satellites for the Space Development Agency’s Tracking Layer.
One specific opportunity Beck mentioned is HASTE, Electron’s suborbital variant. He expects growing demand for HASTE to support testing and validation activities related to missile defense systems developed for Golden Dome. “We foresee this market continuing to expand,” he said.
Cantor Fitzgerald Maintains Overweight on Rocket Lab, Raises Price Target to $54
Keybanc Maintains Overweight on Rocket Lab, Raises Price Target to $50
Needham Maintains Buy on Rocket Lab, Raises Price Target to $55
Citigroup Maintains Buy on Rocket Lab USA, Raises Price Target
Stifel Maintains Buy on Rocket Lab, Raises Price Target to $55
B of A Securities Maintains Buy on Rocket Lab USA, Raises Price Target to $50
