Planet Labs Stock (NYSE:PL) Soars Ahead of Earnings: Can the Momentum Continue?

Planet Labs' stock (NYSE: PL) is currently trading at $12.87, mildly higher on the day (0.2%), as the street awaits earnings. This follows a period of significant gains for the Earth imaging and satellite data services company, driven by strategic partnerships, analyst upgrades, and strong financial performance. 

The street is expecting an EPS loss of $0.04 per share, on revenue of $72.02 million. This will only tell part of the story, with much of the bullish sentiment focused on the growth that is seen as coming. Sales growth for next year (FY27) is currently pegged at 22.45% with the EPS loss on the year seen narrowing to $0.08.

It is the operational developments that have painted a bullish picture for Planet Labs. On November 19th, the company announced a strategic partnership with Quantum Systems to develop AI-powered intelligence solutions for European defense clients. This collaboration, focused on integrating Planet's satellite imagery with Quantum Systems' drone technology, aims to provide actionable insights for frontline drone operations using AI.

Prior to that, in late October, several financial analysts raised their price targets for Planet Labs, citing the company's improving financial health. Needham increased their price target from $12.00 to $16.00, maintaining a ‘Buy' rating, while Deutsche Bank also raised its price target from $10.00 to $16.00, also assigning a ‘Buy' rating. These upgrades were underpinned by Planet Labs' strong performance metrics, including a 22.3% annual revenue growth over the past five years and a positive free cash flow profile, indicating financial self-sustainability.

Further bolstering investor sentiment, Planet Labs reported the shipment of new satellites for an upcoming SpaceX launch and plans to expand its manufacturing capabilities in Europe on October 1st. CEO Will Marshall highlighted the “incredible demand” for high-resolution data driving this growth. The opening of a new manufacturing facility in Berlin, Germany, aims to double the production capacity of its Pelican fleet, addressing strong business growth in Europe, including a multi-year €240 million agreement with the German government and a key contract with NATO. 

The company's robust financial results for its fiscal second quarter, reported in September, sent the stock soaring 44%. Planet Labs posted a loss of $0.07 per share, better than the anticipated loss of $0.09 per share. Revenue increased by 20% to $73.4 million, surpassing Wall Street's forecast of $66.1 million. Importantly, Planet Labs achieved its second consecutive quarter of positive free cash flow, totaling $54.3 million for the year.

The company also raised its full-year revenue guidance to between $281 million and $289 million, up from the previous range of $265 million to $280 million. New contracts with the German government and the U.S. Department of Defense further cemented the company's expanding role in global security initiatives.

Adding to its financial strength, Planet Labs successfully closed an upsized offering of $460 million in Convertible Senior Notes due 2030 on September 12, 2025. CFO Ashley Johnson emphasized that this strategic financing strengthens the company's balance sheet while minimizing shareholder dilution.

Looking ahead, the key question is whether Planet Labs can sustain its impressive growth trajectory. The company's expansion into the defense sector, coupled with its strong financial performance and increasing demand for high-resolution data, suggests a positive outlook. However, investors should also be aware of potential risks, including competition in the satellite imaging market and the inherent volatility of growth stocks.

The stock's strong performance this year, up 224%, suggests that markets are increasingly confident in the company's ability to execute its strategic vision. Much could depend on the company's ability to put forward a strong call, with markets listening intently for clues.