Key Takeaways Bank of America maintained its Buy rating on Rocket Lab (RKLB) with a $115 price target, suggesting approximately 44% potential upside Second quarter revenue reached $234.1 mill
Rocket Lab delivered second quarter revenue of $234.1 million, climbing 62% compared to $144.5 million in the year-ago period. The figure landed marginally below the $237 million Bloomberg consensus estimate, creating headwinds for the share price.
The shortfall originated from the Launch Services division, which posted revenue of $44.6 million, declining roughly 4% year-over-year. This segment represented the lone weakness in an otherwise robust quarterly performance.
Space Systems compensated substantially for the launch revenue gap. This segment’s revenue soared to $189.5 million from $97.9 million in the prior-year quarter, fueled by contracts related to the Space Development Agency’s Tranche II and III initiatives and the company’s spacecraft components operations.
Bank of America analysts had projected $165 million for the Space Systems division. The actual performance exceeded that forecast by approximately $25 million.
Rocket Lab closed the quarter with an unprecedented total backlog of $2.36 billion, representing a 137% surge from the comparable year-earlier period. Approximately 45% of this backlog is projected to convert to revenue within the coming 12 months.
The aerospace firm also locked in over $437 million in additional launch agreements during and following the quarter, elevating its launch mission backlog beyond 90 flights.
On August 13, Rocket Lab established a replacement $1.94 billion at-the-market equity offering program. This facility transfers the remaining balance from a previous May arrangement and is intended to finance the company’s planned Iridium Communications acquisition while reducing outstanding debt.
The Hart-Scott-Rodino antitrust review period for the Iridium transaction has concluded, eliminating a significant regulatory obstacle.
GAAP net loss improved to $49.3 million compared to $66.4 million in the year-ago quarter. Gross profit expanded to $84.6 million from $46.4 million.
Adjusted EBITDA loss totaled $8.8 million, outperforming BofA’s $19.3 million projection and the $22.1 million consensus forecast.
Rocket Lab projected third quarter revenue between $250 million and $265 million. The midpoint implies approximately 66% year-over-year expansion, exceeding the $237 million consensus estimate.
The company’s Q3 gross margin outlook of 29% to 31% may experience some headwinds from deliveries of lower-margin satellite platform products.
Regarding Neutron development, Rocket Lab confirmed that Stage 1 tank manufacturing remains on schedule to enable the reusable medium-lift vehicle’s arrival at the launch pad during the fourth quarter of 2026.
BofA preserved its $115 price objective, derived from a discounted cash flow valuation model extending through 2045. The firm identified manufacturing bottlenecks and Neutron development challenges as potential downside risks.
The broader Wall Street analyst consensus stands at Strong Buy, with an average price target near $114, indicating more than 40% potential appreciation from present levels. RKLB stock continues trading approximately 45% below its year-to-date peak.
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