Rocket Lab (NASDAQ:RKLB) Posts Earnings Results, Misses Expectations By $0.05 EPS

Rocket Lab (NASDAQ:RKLB) announced its quarterly earnings results on Monday. The rocket manufacturer reported ($0.12) earnings per share for the quarter, missing the consensus estimate of ($0.07) by ($0.05), FiscalAI reports. The firm had revenue of $267.83 million for the quarter, compared to analysts’ expectations of $257.21 million. Rocket Lab had a negative net margin of 21.51% and a negative return on equity of 6.48%.

Here are the key takeaways from Rocket Lab’s conference call:

• Rocket Lab reported record Q3 revenue of $267.8 million, up 73% year over year, and GAAP and non-GAAP gross margins exceeded guidance. Q4 revenue is forecast at $270 million–$290 million.
• Backlog reached a record $3.57 billion, up 52% sequentially, following 54 launch bookings and substantial Space Systems awards. Neutron’s first 16 launches are booked, with multiple contracts priced at a $70 million base rate.
• Space Systems delivered $214.8 million in quarterly revenue and had $1.7 billion in backlog; 55-plus spacecraft are in development or production. Management cited strong demand across government, commercial and component businesses.
• Neutron’s first launch has shifted to 2027 after defects were found in a propellant-tank dome; the replacement is being built and tested. Development spending and investment in production remain elevated, and management expects negative free cash flow in Q4.
• The Iridium acquisition is fully financed and received overwhelming shareholder approval, but regulatory approvals remain outstanding. Rocket Lab ended Q3 with about $4.7 billion in liquidity, aided by $2.4 billion in gross proceeds from its completed at-the-market share offering.

Rocket Lab Stock Up 0.7%

Shares of RKLB traded up $0.40 during mid-day trading on Tuesday, hitting $59.26. 9,438,980 shares of the company traded hands, compared to its average volume of 22,696,293. The company has a market capitalization of $35.46 billion, a PE ratio of -219.47 and a beta of 3.15. Rocket Lab has a 1-year low of $37.57 and a 1-year high of $151.00. The company has a quick ratio of 4.98, a current ratio of 5.48 and a debt-to-equity ratio of 0.01. The business has a 50 day moving average of $62.45 and a 200 day moving average of $78.80.

Rocket Lab News Roundup

Here are the key news stories impacting Rocket Lab this week:

• Positive Sentiment: Q3 revenue rose 73% year over year to $267.8 million, beating estimates, while backlog grew 52% sequentially to a record $3.57 billion. Rocket Lab forecast Q4 revenue of $270 million to $290 million, above consensus. Company Q3 results and outlook
• Positive Sentiment: Rocket Lab secured more than $515 million in Neutron launch deals during Q3, bringing the rocket’s backlog to 16 missions and lifting the listed base price to $70 million. Neutron launch contracts
• Neutral Sentiment: Analyst views were mixed: KeyCorp reaffirmed its Overweight rating and $100 target, while Piper Sandler cut its target to $58 and Cantor Fitzgerald lowered its target to $111 but kept an Overweight rating. Analyst forecast changes
• Negative Sentiment: Q3 EPS of -$0.12 missed the roughly -$0.07 consensus, and the net loss widened to $80 million. Reports also cited a wider-than-expected Q4 adjusted EBITDA loss outlook, raising concerns about costs and margins despite the revenue growth. Q3 earnings reaction
• Negative Sentiment: Investors also weighed Neutron’s first launch remaining scheduled for 2027, extending execution risk for a key growth program. Neutron timeline analysis

Insider Buying and Selling at Rocket Lab

In other news, SVP Arjun Kampani sold 6,034 shares of the company’s stock in a transaction dated Thursday, August 27th. The stock was sold at an average price of $66.65, for a total value of $402,166.10. Following the sale, the senior vice president owned 250,917 shares in the company, valued at $16,723,618.05. This represents a 2.35% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Nina Armagno sold 10,926 shares of the company’s stock in a transaction dated Monday, November 2nd. The stock was sold at an average price of $52.78, for a total transaction of $576,674.28. Following the completion of the transaction, the director owned 100,496 shares of the company’s stock, valued at approximately $5,304,178.88. This trade represents a 9.81% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders have sold 551,832 shares of company stock worth $34,940,037. 8.40% of the stock is owned by corporate insiders.

Wall Street Analyst Weigh In

Several equities research analysts have recently commented on RKLB shares. KGI Securities raised shares of Rocket Lab from a “neutral” rating to an “outperform” rating and set a $107.00 price target for the company in a research report on Monday, July 27th. Weiss Ratings reiterated a “sell (d-)” rating on shares of Rocket Lab in a research report on Thursday, October 15th. Piper Sandler reduced their price target on shares of Rocket Lab from $83.00 to $58.00 and set a “neutral” rating on the stock in a report on Tuesday. Citigroup reiterated a “market outperform” rating on shares of Rocket Lab in a research report on Friday, October 16th. Finally, Bank of America dropped their price target on Rocket Lab from $115.00 to $110.00 and set a “buy” rating for the company in a research report on Monday, August 31st. Three investment analysts have rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating, five have given a Hold rating and one has issued a Sell rating to the company’s stock. According to data from MarketBeat.com, Rocket Lab presently has a consensus rating of “Moderate Buy” and a consensus price target of $100.10.

Rocket Lab Company Profile

Rocket Lab is a space company that provides launch services and spacecraft and satellite systems for commercial, civil, and national security customers. Founded in 2006 by Peter Beck, the company operates internationally, with headquarters in Long Beach, California, and launch operations in New Zealand and the United States.

Its launch business centers on Electron, a small orbital rocket designed to carry satellites to space, and HASTE, a suborbital vehicle used for hypersonic test missions.