Planet Labs Eyes Growth as Q1 Results Highlight Satellite Sector Momentum

Planet Labs PBC (NYSE: PL), a leader in daily satellite imagery and geospatial solutions, will release its fiscal first quarter 2026 results on June 4, 2025. The earnings announcement comes amid a backdrop of rapid growth in Earth observation technologies and strategic partnerships that could position the company for sustained expansion. Investors will be watching closely for signs of progress toward profitability and execution on high-profile contracts like its $230 million deal with Japanese satellite operator SKY Perfect JSAT.

Financial Momentum and Strategic Wins

Planet’s recent performance underscores its transition from a loss-heavy startup to a company with improving margins and a robust order book. In fiscal 2025, revenue rose 11% year-over-year to $244.4 million, while adjusted EBITDA swung to a $2.4 million profit in Q4 2025—the first quarter of positive adjusted EBITDA in its history. The company’s backlog surged to $498.5 million as of January 2025, a 115% quarterly increase, driven by long-term contracts like the JSAT agreement and wins in the defense sector.

The Q1 2026 guidance calls for revenue of $61 million to $63 million, with an adjusted EBITDA loss narrowed to $3 million to $2 million. Analysts will scrutinize whether the company can sustain this margin improvement amid capital expenditures of $11 million to $16 million for satellite launches and AI infrastructure.

Key Drivers of Growth

1. Defense and Intelligence Sector: Revenue in this segment grew over 20% in 2025, fueled by contracts such as the $200 million ceiling Luno B IDIQ with the U.S. National Geospatial-Intelligence Agency (NGA) and a seven-figure prototype order from the Department of Defense (DoD). These wins highlight the growing demand for commercial satellite data in national security and environmental monitoring.

2. JSAT Partnership: The $230 million deal with SKY Perfect JSAT represents a transformative step. Planet will build, launch, and operate a constellation of 10 Pelican satellites, retaining commercial rights to most capacity. This agreement not only diversifies Planet’s revenue streams but also expands its presence in Asia’s geostationary satellite market.

3. Hyperspectral Innovation: The Tanager satellite, launched in 2024, has already detected over 1,000 methane and CO₂ plumes via partnerships like Carbon Mapper. With plans to commercialize hyperspectral data sales within months, this capability could open new revenue streams in energy and environmental monitoring.

4. AI Integration: Planet’s collaboration with AI firm Anthropic aims to refine models like Claude using satellite data, accelerating analytics for customers. CEO Will Marshall has emphasized AI as a core growth lever, targeting a doubling of revenue growth rates by 2027 compared to 2026’s projected 6–15% increase.

Risks and Challenges

• Execution Risks: Launching nearly 100 satellites over two years requires flawless execution. Delays or cost overruns could pressure margins and backlog realization.
• Government Dependency: Over 35% of 2025 revenue came from defense and civil government contracts, which often include termination clauses. Geopolitical tensions or funding cuts could disrupt cash flows.
• Capital Needs: Planet plans $50–65 million in capital expenditures in 2026, relying on its $222 million cash balance to fund operations without dilution.

Conclusion: A Satellite-Based Future, but Hurdles Remain

Planet’s Q1 2026 results will be a litmus test for its transition to profitability. With a backlog up 115% year-over-year and adjusted EBITDA turning positive in Q4 2025, the company is on track to achieve its goal of cash flow breakeven within 24 months. However, investors must weigh this progress against execution risks and macroeconomic headwinds.

The satellite imagery market is poised for growth, driven by demand for real-time data and AI-driven insights. Planet’s leadership in both technology (e.g., Pelican-2’s high-resolution imaging) and partnerships (e.g., JSAT, Microsoft, and The Nature Conservancy) positions it as a key player. Yet, with shares trading at a 52-week low of $1.67, any near-term misses on revenue or margin targets could amplify volatility.

As Planet prepares to report on June 4, the focus will be on whether its strategic bets—such as the JSAT constellation and hyperspectral data commercialization—are translating into sustained revenue growth. If so, the company could solidify its status as a pioneer in the $20 billion Earth observation market, where daily data and AI are redefining industries from agriculture to national security.