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    RKLB
    Earnings call· Jun 2026(Q2 FY26)

    Rocket Lab Q2 FY26 earnings call RKLB

    Aug 10, 2026 Source

    Executive summary

    Rocket Lab Q2 FY26 — Record Revenue and Strategic Iridium Acquisition

    Rocket Lab delivered record Q2 revenue driven by strong performance in both Launch Services and Space Systems, alongside significant new contract wins and a growing backlog. The company announced the strategic acquisition of Iridium, aiming to become a fully integrated space powerhouse with capabilities across launch, satellite manufacturing, and space applications. Neutron development continues with key milestones achieved, though cash consumption remains elevated due to ongoing investments.

    Highlights

    5

    • Achieved record Q2 revenue of $234 million, up 62% year-over-year.

    • Secured over $1 billion in new contracts in Q2 and post-quarter, including a record $266 million Space Force launch contract.

    • Ended the quarter with a record $2.36 billion in total backlog, including 90+ launches.

    • Successfully executed the VICTUS HAZE mission, setting new records for launch (16 hours 42 minutes) and satellite commissioning (38 hours).

    • Adjusted EBITDA loss of $8.8 million was well below the guidance range of $20 million to $26 million.

    Concerns

    4

    • GAAP operating cash flow was a use of $84.1 million in Q2, an increase from $50.3 million in Q1.

    • Non-GAAP free cash flow was a use of $110.1 million in Q2, an increase from $77.4 million in Q1.

    • GAAP EPS was a loss of $0.08 per share, a sequential decline from a loss of $0.07 per share in Q1.

    • Q3 FY26 GAAP gross margin is forecasted to range between 29% to 31%, a decrease from Q2's 36.1%.

    Guidance & targets

    13
    CategoryTargetConfidence
    Revenue
    $250 million to $265 million
    high materiality
    High
    GAAP Gross Margin
    29% to 31%
    medium materiality
    High
    Non-GAAP Gross Margin
    35% to 37%
    medium materiality
    High
    GAAP Operating Expenses
    $143 million and $149 million
    medium materiality
    High
    Non-GAAP Operating Expenses
    $121 million and $127 million
    medium materiality
    High
    Net Interest Income
    $21 million
    low materiality
    High
    Adjusted EBITDA Loss
    $17 million and $23 million
    high materiality
    High
    Basic Weighted Average Common Shares Outstanding
    approximately 641 million shares
    low materiality
    High
    Non-GAAP Free Cash Flow
    negative, elevated levels
    high materiality
    High
    Neutron First Launch
    Q4 2026
    high materiality
    Medium
    Iridium Acquisition Completion
    mid-2027
    high materiality
    Medium
    Adjusted EBITDA Positivity
    in the quarter after Neutron's first successful test launch
    high materiality
    High
    Cash Flow Positivity
    18 to 24 months after Adjusted EBITDA positivity
    high materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Space Systems
    Growth primarily driven by increased contribution from satellite manufacturing business and initial contribution from Mynaric acquisition.
    Contribution from satellite manufacturing business: increasedInitial contribution from Mynaric acquisition
    		$189.5 million—38.6%—
    Launch Services
    Decline primarily attributable to a shift in revenue mix between point-in-time Electron business and overtime HASTE business, with significant HASTE revenue recognized in prior periods.
    Revenue mix shift: point-in-time Electron vs. overtime HASTE
    		$44.6 million—30% decrease—

    Operational metrics

    31
    Total Revenue
    $234 millionup $90 million or 62% vs. Q2 FY25; up $34 million vs. Q1 FY26
    Q2 FY26

    Record Q2 revenue.

    GAAP Gross Margin
    36.1%above prior guidance range of 33% to 35%
    Q2 FY26

    Key drivers include shift mix within Space Systems to slightly lower gross margin satellite platforms and initial contributions from Mynaric acquisition. Nonrecurring benefit from tariff refunds largely offset by inventory reserve against Neutron Flight II.

    Non-GAAP Gross Margin
    41.5%above prior guidance range of 38% to 40%
    Q2 FY26

    Key drivers include shift mix within Space Systems to slightly lower gross margin satellite platforms and initial contributions from Mynaric acquisition. Nonrecurring benefit from tariff refunds largely offset by inventory reserve against Neutron Flight II.

    Production Headcount
    1,688up 240 from Q1 FY26
    Q2 FY26
    GAAP Operating Expenses
    $142.1 millionwithin guidance range of $138 million to $144 million
    Q2 FY26
    Non-GAAP Operating Expenses
    $115.7 millionbelow guidance range of $120 million to $126 million
    Q2 FY26
    GAAP R&D Expenses
    increased $1.9 millionQoQ
    Q2 FY26

    Primarily due to incorporating Mynaric expenses.

    Non-GAAP R&D Expenses
    rose $830,000QoQ
    Q2 FY26

    Primarily due to incorporating Mynaric expenses.

    R&D Headcount
    1,087increase of 138 from Q1 FY26
    Q2 FY26
    GAAP SG&A Expenses
    increased $7.7 millionQoQ
    Q2 FY26

    Primarily due to incorporating Mynaric expenses.

    Non-GAAP SG&A Expenses
    increased $9.8 millionQoQ
    Q2 FY26

    Primarily due to incorporating Mynaric expenses.

    SG&A Headcount
    442increase of 61 from Q1 FY26
    Q2 FY26
    Total Headcount
    3,217up 439 from Q1 FY26
    Q2 FY26
    Purchases of property, equipment and capitalized software licenses
    $26 milliondecrease of $1 million from $27.1 million in Q1 FY26
    Q2 FY26

    Continuing to invest in Neutron, particularly for the return on investment recovery barge as well as launch and test infrastructure investments.

    GAAP EPS
    loss of $0.08compared to loss of $0.07 per share in Q1 FY26
    Q2 FY26

    Sequential decline primarily reflects inclusion of Mynaric's results after acquisition closed, including amortization of intangible assets acquired.

    Cash, cash equivalents, restricted cash and marketable securities
    roughly $2.4 billionsequential increase
    Q2 FY26

    Sequential increase driven by proceeds from sales of common stock under at-the-market equity offering program, which generated $1.08 billion during the quarter.

    Adjusted EBITDA Loss
    $8.8 millionbelow guidance range of $20 million to $26 million of loss; sequential improvement of $2.9 million
    Q2 FY26

    Largely driven by higher revenue and strong gross margin.

    Backlog Conversion
    approximately 45.5%
    next 12 months

    Expected to convert into revenue within the next 12 months.

    New Contracts Signed
    more than $1 billion
    Q2 FY26 and post-quarter
    Launch Bookings
    more than $437 million
    Q2 FY26 and post-quarter

    Includes a record $266 million contract for up to 18 suborbital missions for the Space Force.

    Space Systems Bookings
    more than $581 million
    Q2 FY26 and post-quarter
    Launches YTD
    13on track to beat last year's tally
    YTD FY26

    Electron and HASTE continue to lead the industry on small launch.

    Iridium Annual Revenue
    $870 million
    past year

    From a constellation of 66 satellites relied upon by more than 2.5 million subscribers.

    Iridium Subscribers
    2.5 million
    past year
    VICTUS HAZE Launch Time
    16 hours and 42 minutesnew record; vs 24 hours target
    Q2 FY26

    Time to launch an Electron to orbit for Space Force.

    VICTUS HAZE Satellite Commissioning Time
    38 hoursvs 72 hours target
    Q2 FY26

    Time to commission the satellite on orbit for Space Force.

    VICTUS HAZE Satellite Tracking Time
    less than 59 hoursvs 84 hours target
    Q2 FY26

    Time to track, chase and photograph a noncooperative satellite for Space Force.

    Total Launch Pads
    6
    current
    Archimedes Engine Hot Fires
    more than 400
    YTD

    Completed across both Stage 1 engines and Stage 2 vacuum engines.

    NSSL Lane 1 Ceiling
    $17 billiontripling from $5.6 billion
    current

    Pentagon accelerating procurement for its top priority programs.

    Proceeds from At-The-Market Equity Offering Program
    $1.08 billion
    Q2 FY26

    Generated during the quarter before it was subsequently terminated. Funds intended to support acquisitions and general corporate expenditures.

    Industry KPIs

    3
    MetricValueDetails
    Total company backlog$2.36 billionUSD
    Defense program awards$266 millionUSD
    Program segment backlog$397 millionUSD

    Orderbook & backlog

    3
    Total Backlog$2.36 billionQ2 FY26

    approximately 45.5% to convert into revenue within the next 12 months

    Launch Backlog90-plus launchespost Q2 FY26

    grew from 26 new launches

    accounting for approximately 40% of total backlog

    Space Systems Backlog60%Q2 FY26

    representing 60% of total backlog

    Product announcements

    2
    ProductTypeDetails
    Flatellitelaunch
    GHOST (Containerized Deployable Launch Site Technology)launch

    Deals & partnerships

    10
    Iridium CommunicationsCombine Rocket Lab's launch and satellite manufacturing with Iridium's global satellite communications network and spectrum.

    Rocket Lab will become a self-launching Tier 1 space power. Transaction requires Iridium stockholder approval and regulatory review.

    MynaricDeepen roots in Europe, establish regional hub for constellation class manufacturing and full-scale spacecraft assembly.

    Official establishment of Rocket Lab, Germany. Aims to streamline, scale production, and introduce new capabilities.

    MotivStrategic acquisition to accelerate future in space applications.

    Mentioned as a milestone acquisition in Q2.

    Space ForceContract for up to 18 suborbital missions.$266 million

    Multiyear, multi-launch Department award deal for suborbital missions. Launches mostly from Kodiak, Alaska.

    Space ForceContract to build and launch multiple Flatellite spacecraft for the space-based airborne moving target indicator program.$397 million

    Neutron will be launching this mission. High priority program for the Department of War.

    Space Systems CommandPrime contract to build two GEO satellites for space domain awareness.part of two deals totaling more than $160 million

    Will incorporate Heimdall payload from GEOST. First step into government geostationary satellite market.

    NASAContract for three Electron launches across two missions.

    Launches scheduled for next year.

    QPSContract for another three Electron launches.

    Third bulk buy in less than a year.

    Confidential defense primeContract for a pair of HASTE launches.

    Launches in 2027. HASTE rapid repeatable flight cadence was the clincher.

    Kepler CommunicationsDedicated Neutron launch to deliver satellites to lower earth orbit.

    First time Kepler has booked an entire rocket for their constellation. Mission will expand network capacity with on-orbit compute, optical comms, and hosted payloads.

    Capital programs

    2
    Neutron Development and Production Scalingunderway
    Period spend: $26 million

    Benefit: return on investment recovery barge as well as launch and test infrastructure investments

    As we progress towards Neutron's first flight, we expect capital expenditures to remain elevated as we invest in testing, production scaling and infrastructure expansion.

    Kodiak Launch Site Deployment (GHOST)underway
    Funding: funded under that agreement to a large part

    Benefit: two new pads in Alaska; unmatched geographical flexibility for all mission types

    The two new pads in Alaska will be deployed using our GHOST containerized deployable launch site technology.

    Risks & headwinds

    4
    Elevated cash consumptionQ2 FY26, expected to remain elevated in Q3 FY26.

    GAAP operating cash flow use of $84.1 million in Q2 FY26 (vs $50.3 million in Q1 FY26); Non-GAAP free cash flow use of $110.1 million in Q2 FY26 (vs $77.4 million in Q1 FY26).

    Mitigation: Proceeds from ATM equity offering ($1.08 billion) to support growth initiatives; future adjusted EBITDA and cash flow positivity tied to Neutron's success.

    Gross margin pressure from Space Systems mixQ3 FY26

    Q3 FY26 GAAP gross margin expected 29%-31% (down from Q2's 36.1%); Non-GAAP gross margin expected 35%-37% (down from Q2's 41.5%).

    Mitigation: Expect a beneficial remixing impact on gross margins beyond Q3; Mynaric integration synergies and scale advantages.

    Neutron development complexity and schedule riskQ4 2026 (first launch target)

    Window for an end year launch is narrowing for Neutron.

    Mitigation: Balancing timing of first launch with ensuring readiness for full-scale production and high-cadence launch; focus on reusability and robust qualification criteria.

    Supply chain challenges for MynaricQ2 FY26 and subsequent quarters.

    Mynaric's gross margins initially lower; required replenishment of supply chain.

    Mitigation: Decisive action taken to understand margin improvement needs; increased volumes expected; cost efficiencies.

    What to watch in Q3 FY26

    5

    Neutron First Launch

    Q4 2026
    CurrentTarget delivery of Neutron to the pad in Q4 2026
    TargetSuccessful first flight

    Why it matters

    Successful first launch is a major de-risking event and a prerequisite for adjusted EBITDA positivity and future cash flow.

    Production currently lines up with the target delivery of Neutron to the pad in Q4 2026. While the window for an end year launch is narrowing, the work we're doing now is about risk trading, balancing the timing of📎 our first launch against how quickly and seamlessly we can scale at tenth launch.

    Q&A highlights

    6

    How quickly can Neutron scale to 10 launches, and will ASPs increase given market constraints?

    Management is focused on achieving flight 10 quickly through robust reusability, balancing first flight timing with full-scale production readiness. ASPs for Neutron are expected to see upside due to high demand and market constraints, with current pricing at $50M-$55M.

    “I think right now, the view is that we see more upside to ASPs and certainly anything that are down or sideways.”

    asked by Andres Sheppard-Slinger · answered by Adam Spice

    2 min read5 chapters

    Detailed Narrative

    01

    Strategic Vertical Integration with Iridium

    Rocket Lab's planned acquisition of Iridium Communications is a pivotal move to integrate launch, satellite manufacturing, and space applications. This will enable Rocket Lab to become a self-launching Tier 1 space power, leveraging Iridium's existing constellation and L-band spectrum for critical communications, with plans for expansion into IoT, direct-to-device, and PNT defense markets. The transaction is expected to close in mid-2027, pending regulatory and shareholder approvals, and is seen as a starting point for further applications plays.

    02

    Space Systems Growth and Diversification

    The Space Systems segment saw significant contract wins, including a $397 million contract for Flatellite spacecraft for the Space Force's airborne moving target indicator program, and over $160 million for three geostationary satellites. The successful VICTUS HAZE mission demonstrated Rocket Lab's end-to-end capabilities in delivering rockets, spacecraft, and orbit operations with record-breaking speed for the Space Force, highlighting the company's advanced capabilities for national security programs.

    03

    Neutron Development Progress and Demand

    Neutron's development is progressing with significant testing across Stage 1, Stage 2, the thrust module, and Archimedes engines, with over 400 hot fires completed. The company is balancing the timing of📎 the first launch (targeting Q4 2026) with ensuring the system is ready for full-scale production and high-cadence launch, focusing on reusability. Demand for early Neutron flights is high, with new contracts from the Space Force and Kepler Communications, despite the vehicle not yet having flown.

    04

    Launch Services Demand and GHOST Technology

    Launch Services experienced extreme demand, securing over $437 million in new contracts, including a record $266 million contract for up to 18 suborbital missions for the Space Force. The introduction of GHOST containerized deployable launch site technology aims to provide rapid, mobile launch capabilities, initially for the new Kodiak, Alaska pads, addressing customer needs for flexible launch locations for missile defense testing and sovereign orbital launch capability.

    05

    European Expansion and Market Opportunity

    Rocket Lab is deepening its roots in Europe with the official establishment of Rocket Lab Germany, following the Mynaric acquisition. This aims to create a regional hub for constellation-class manufacturing and spacecraft assembly, integration, and test, addressing Europe's launch deficit and providing domestic strength in the rapidly evolving space sector. The company sees significant opportunities in Europe due to nations seeking sovereignty in space capabilities.

    AI-generated summary of the company’s earnings call. Not investment advice.