Planet Labs projects FY 2026 revenue of $281M–$289M amid accelerating defense and satellite services demand
Sep. 08, 2025 11:17 AM ET
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Earnings Call Insights: Planet Labs PBC (PL) Q2 2026
Management View- Will Marshall, CEO, highlighted progress since going public, noting "we've launched nearly 200 satellites on 6 rockets, including our next-generation Pelican and Tanager satellites." He emphasized a shift "towards selling solutions, leveraging AI to enable speed and scale," and the launch of a "new satellite services offering." Marshall reported, "We generated $73.4 million in revenue, representing approximately 20% year-over-year growth, marking another quarter of growth reacceleration." He also stated, "Our backlog increased to $736.1 million at the end of the quarter, representing a year-over-year increase of 245%." A key announcement was, "We are now expecting to be free cash flow positive this fiscal year, over a year ahead of our prior target and a major milestone for the company."
- Marshall detailed major wins: "We were awarded an additional 7-figure option by the Defense Innovation Unit, part of the U.S. Department of Defense," and expanded work with the U.S. National Reconnaissance Office under the EOCL program.
- He announced a "EUR 240 million multiyear satellite services collaboration with Germany," and stated, "We now have 4 Pelicans in orbit and multiple Pelican launches slated for the next year."
- Ashley Whitfield Johnson, President & CFO, stated, "Revenue came in at $73.4 million, representing approximately 20% year-over-year growth. Strength was primarily driven by key wins with defense and intelligence customers, higher-than-expected usage by some of our government accounts and steady progress against our new JSAT contract."
Outlook- For Q3, Johnson said, "We're expecting revenue to be between $71 million and $74 million."
- She added, "We expect non-GAAP gross margin for the quarter to be between 55% and 57%. Our adjusted EBITDA range for the third quarter is expected to be between minus $4 million to breakeven."
- For full fiscal year 2026, "We now expect revenue to be between $281 million and $289 million. This increase in range for our outlook reflects our strong performance in Q2 and the improved visibility for the back half of the year," according to Johnson.
- The CFO reiterated expectations of being "free cash flow positive on an annual basis this year over a year earlier than the target we previously shared."
Financial Results- Q2 revenue was $73.4 million, up about 20% year-over-year.
- Non-GAAP gross margin was 61% in Q2, up from 58% a year ago.
- Adjusted EBITDA profit was $6.4 million, marking the third sequential quarter of adjusted EBITDA profitability.
- Free cash flow was $54.3 million year-to-date, with a free cash flow margin of approximately 39%.
- Backlog increased to $736.1 million at quarter end, up 245% year-over-year.
- Remaining performance obligations (RPOs) were approximately $690 million, up approximately 516% year-over-year.
- The company ended Q2 with $271.5 million in cash, cash equivalents and short-term investments, an increase of $45 million sequentially.
- Net dollar retention rate at the end of Q2 was 107% and with win backs was 108%.
Q&A- Colin Canfield, Cantor Fitzgerald: Asked about contract backlog and growth dynamics around major contracts in Germany and JSAT. Johnson responded, "The full amount would be in those numbers and obviously recognized over multiple years."
- Canfield followed up on working capital and free cash flow ladder. Johnson said, "What we see from the satellite services contracts is that they are positive for us from a working capital perspective and enables us to build out the fleet without needing to fund those build-outs from our balance sheet."
- Trevor Walsh, Citizens JMP: Asked about pipeline for satellite services contracts. Genualdi stated, "We're just seeing a lot of strong demand there...we're leaning into that."
- Walsh followed up on gross margin sustainability. Johnson said, "The margin number will likely vary as we see -- as we progress into the build phase of some of these satellite services contracts, which are lower margin than the earlier years."
- Mike Latimore, Northland: Asked about usage levels and renewals. Johnson explained, "When we see an uptick in usage like that...we don't assume that, that will continue into subsequent quarters, but instead look at historical pacing."
- Latimore asked about EOCL renewal timing. Marshall responded, "We continue to be very proud of what we're doing there and seeing that expansion come in."
- Ryan Koontz, Needham: Asked about satellite capacity for Japan and Germany. Marshall explained, "The majority of our capacity in the rest of world capacity is still continuing to provide to our other customers."
- Koontz inquired about Maritime Domain Awareness. Marshall said, "It is our most mature AI-enabled solution, and we have a strong pipeline of others that we're going after."
- Daniel Hibshman, Craig-Hallum: Asked about commercial sector strength. Marshall replied, "Energy and agriculture, but also insurance...we're starting to see that turnaround."
- Gregory Pendy: Sought an update on the Anthropic relationship. Marshall said, "What we're doing with Anthropic, in particular, is helping to fine-tune the model on our data...it's a very, very exciting time."
- Caleb Henry, Quilty Space: Asked about monetizing the Tanager fleet and backlog recognition. Marshall confirmed progress and revenue opportunities, "We have 2 solid revenue opportunities already for that."
- Johnson detailed backlog distribution: "The large contracts that we've announced this year...were big drivers of that backlog increase."
Sentiment Analysis- Analysts focused on contract visibility, usage trends, gross margin sustainability, and pipeline execution, with a generally positive to neutral tone, expressing interest in growth drivers and risk management.
- Management maintained a confident and upbeat tone in both prepared remarks and Q&A, with Johnson highlighting "another excellent quarter with strong execution" and Marshall stating, "our business is humming, and I feel very proud of the work of our teams."
- Compared to the previous quarter, management's tone remained confident but with greater emphasis on accelerating growth and robust backlog.
- Analyst tone was slightly more focused on details of contract execution and durability of new growth, rather than macro risks.
Quarter-over-Quarter Comparison- Guidance for full-year revenue was raised from a range of $265 million–$280 million in Q1 to $281 million–$289 million in Q2, reflecting improved performance and visibility.
- Backlog increased significantly from $527 million at Q1 end to $736.1 million at Q2 end.
- Non-GAAP gross margin improved to 61% in Q2 from 59% in Q1.
- Adjusted EBITDA profit increased from $1.2 million in Q1 to $6.4 million in Q2.
- Management's tone shifted further towards confidence in growth acceleration and free cash flow positivity.
- Analysts continued to focus on contract execution, margin dynamics, and sectoral trends, but with increased attention to the sustainability of recent wins.
Risks and Concerns- Civil government sector revenue declined due to contract expiration with Norway, impacting year-over-year performance in that segment.
- Management noted ongoing monitoring of "the evolving landscape of U.S. government budgets."
- Johnson highlighted that gross margin may vary given the "mix of revenue" and the build phase of satellite services contracts, which are lower margin initially.
- Some customer usage patterns were described as variable, with management cautious about projecting continued elevated levels.
- Analyst questions revealed interest in timing and structure of backlog recognition and renewal risks, especially around large government programs.
Final Takeaway
Planet Labs delivered strong Q2 results, highlighted by robust year-over-year growth, a substantial increase in backlog, and accelerated progress toward profitability milestones. The company raised its fiscal 2026 revenue guidance, citing strength in defense and intelligence contracts, a growing satellite services pipeline, and continued margin expansion. Management emphasized confidence in sustained growth and free cash flow generation, while maintaining a cautious approach to usage patterns and government budget dynamics. The quarter showcased Planet's strategic positioning in AI-enabled solutions and sovereign satellite services, with visibility into future revenues supported by a record backlog.
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