Planet Labs Soars 17.79% on Strong Q1 Earnings, Defense Wins

Planet Labs (PL) saw a significant rise of 17.79% in pre-market trading on June 5, 2025, driven by strong financial performance and strategic initiatives.

In the first quarter of fiscal 2026, Planet Labs reported a 10% year-over-year revenue increase, reaching $66.3 million. This growth was primarily driven by key defense and intelligence contract wins and strong performance in the government sector. The company achieved positive free cash flow for the first time, generating $8 million, and reported adjusted EBITDA profitability of $1.2 million, marking the second consecutive quarter of profitability on this metric.

The defense and intelligence sector saw over 20% year-over-year revenue growth, bolstered by an eight-figure European defense contract expansion. However, civil government revenue declined due to contract expirations, while the commercial sector remained flat. The company's backlog grew to $527 million, with 45% of it applying to the next twelve months, indicating strong future revenue visibility.

Planet Labs is focusing on expanding its AI-enabled integrated insights and satellite services solutions, with partnerships with Anthropic and Google for AI model development. The company is also investing in its next-generation satellite fleets, with multiple Pelican launches planned for the year. Despite short-term cost pressures, Planet Labs remains committed to its long-term profitability targets and strategic growth initiatives.