Planet Labs (PL.US) is a US-based satellite imaging company founded by former NASA scientists. Planet provides precise satellite imagery of selected portions of the Earth in support of intelligence reconnaissance and providing business solutions for private companies. The company's results for the second quarter of the year positively surprised Wall Street, sending its stock valuation soaring:
- The company raised its 2022 revenue forecast estimates despite a challenging macroeconomic environmen
- Geopolitical situation and climate change boost demand for satellite reconnaissance services
- With the acquisition of VanderSat in late 2021, PlanetLabs can analyze and process data based on satellite images of the Earth
Q2 revenue was $48.45 million vs. $42.36 million forecast
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- Adjusted gross margin was 52% vs. 36% in Q2 2021. Year-over-year revenue growth in Q2 was 59%.
- The company expects higher revenues for 2022, in the range of $182 - $190 million vs. previous estimates of $177 - $187 million.
- The company expects the trend of rising revenues to continue, and estimates $45 million-$48 million in the current third quarter against analysts' forecasts of around $46 million.
- The 2022 results are in line with management's promises prior to the company's IPO, at which time they projected revenues in the vicinity of $191 million in 2022, which the company plans to 'prove'. Management's optimistic forecasts also call for very high margins at levels exceeding 70%, in 2025.
The company's CEO, Will Marshall commented on the results: "Second quarter results exceeded expectations and show continued acceleration in growth and strong demand for our unique Earth data solutions."
- Planet Labs' customers have access to a platform that enables deep data analysis and the construction of advanced charts and forecasts. In June of this year, the company signed a significant agreement with German giant Bayer. The service is also used by BASF, which monitors the health of crop fields thanks to data provided by Planet Labs. Planet Labs has more than 200 active, Earth-orbiting satellites, with 855 entities using the company's services at the end of the second quarter.
- Despite surprisingly good sales, as sales increase, so do the costs of doing business. Growth in the cost of revenue was 25% but operating expenses doubled and are still outpacing the rate of revenue growth;
- The biggest challenge facing the company will be to skillfully scale the business model and obtain more and more contracts from private customers. A threat is the high cost of operations, which may weigh on the margins of the company's business. Planet Labs to maintain the positive effect of business development and sales should also focus on reducing the cost of revenue.
Planet Labs (PL.US) stock chart, H4 interval. The price came out of consolidation at the top and broke through the 200-session moving average after the presentation of the second quarter results for the year. The RSI stands at 57.2 and has cooled noticeably. The stock has slipped about 10% from its record valuation. Analysts are still bullish on the company's shares, with a consensus target price of around $9. Source: xStation5
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