Planet Labs: The Sell-Off Masks A Much Stronger Business

Summary Planet Labs delivered a strong Q2 with 58% revenue growth, margin expansion, and raised full-year guidance, validating robust demand for sovereign satellite services and AI-enabled analytics. PL’s revenue mix is now heavily weighted toward defense and intelligence, introducing lumpiness and higher customer concentration, but backlog visibility remains solid with over $400M expected to convert in 12 months. Capital intensity is rising, with FY27 capex guidance up to $100–$115M and ongoing ATM share issuance, leading to material dilution risk but supporting strategic expansion and launch capacity. I maintain a speculative Buy rating with a new $29.33 price target, reflecting robust growth expectations, improved profitability, and ongoing dilution and execution risks. Looking for more investing ideas like this one? Get them exclusively at The Aerospace Forum. Learn More » NicoElNino/iStock via Getty Images Shares of Planet Labs PBC ( PL ) have fallen by more than 50% since my last report even though the company delivered a much stronger second quarter than its share price suggests. Revenue grew nearly 60% while non-GAAP gross margin recovered to 59%, and This article was written by Dhierin Bechai 24.75K Followers Follow Dhierin-Perkash Bechai is an aerospace, defense and airline analyst. Dhierin runs the investing group The Aerospace Forum, whose goal is to discover investment opportunities in the aerospace, defense and airline industry. With a background in aerospace engineering, he provides analysis of a complex industry with significant growth prospects, and offers context to developments as they occur, describing how they might affect investment theses. His investing ideas are driven by data informed analysis. The investing group also provides direct access to data analytics monitors. Learn more. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.