0001836833-25-000104
SEC filingRevenue grew 20% in Q2 FY26 driven by defense & intelligence customers, with improved gross margin and positive Adjusted EBITDA.
For the three months ended July 31, 2025, Planet Labs reported revenue of $73.4 million, up 20% from $61.1 million in the same period last year. The growth was primarily driven by a $8.6 million increase from new customer growth and a $3.7 million increase from existing customer contracts, with strength across Defense and Intelligence verticals. Gross profit increased 31% to $42.3 million, while gross margin expanded to 58% from 53% in the prior year, benefiting from a $2.1 million decrease in depreciation expense as certain high-resolution satellites became fully depreciated, partially offset by higher employee-related costs for satellite services contracts.
Operating expenses declined 16% to $60.2 million, with reductions in R&D (down 11%), sales and marketing (down 26%), and G&A (down 12%), largely due to prior-year severance charges and headcount reductions. This drove a significant improvement in operating loss from ($39.6 million) to ($18.0 million). Net loss narrowed to ($22.6 million) from ($38.7 million), despite a $5.7 million unfavorable change in fair value of warrant liabilities. Adjusted EBITDA turned positive at $6.4 million, compared to ($4.4 million) in the prior year, highlighting improved operational leverage.
The MD&A does not provide a formal segment breakdown of revenue or profit. However, management discusses growth drivers across customer verticals. The company serves civil government, commercial, and defense and intelligence customers. The reported revenue growth was attributed to both new and existing Defense and Intelligence customers. Key operational metrics indicate strengthening customer economics: Net Dollar Retention Rate rose to 107% for the six months ended July 31, 2025 (from 99% a year ago), and Net Dollar Retention Rate including winbacks reached 108%. End-of-period customer count decreased to 908 from 1,012, reflecting a strategic focus on larger customers. Percent of Recurring ACV improved to 98% from 96%, indicating a higher proportion of subscription-based revenue.
Management highlighted several strategic priorities and recent developments. In January 2025, Planet entered a $230 million commercial satellite services agreement with SKY Perfect JSAT to build and operate ten Pelican high-resolution satellites owned by JSAT, with launches expected beginning in 2027. In June 2025, a €240 million agreement funded by the German government was signed for dedicated image tasking and downlink services on Pelican satellites. These contracts contributed to a significant increase in backlog to $736 million as of July 31, 2025, from $504 million at January 31, 2025. The company expects capital expenditures and working capital to increase in the foreseeable future as it scales operations. Management also noted plans to continue investing in data products, platform ecosystem, and new sensor capabilities to drive growth in existing and new verticals. No specific quantitative guidance for future periods was provided.
As of July 31, 2025, Planet Labs held $181.1M in cash and cash equivalents, plus $90.5M in short-term investments, for total liquidity of $271.6M. Restricted cash of $11.8M is primarily for escrow and collateral. Total assets were $696.4M, with stockholders' equity of $435.7M. The company has no debt, but carries $13.4M in public and private placement warrant liabilities.
Planet Labs has $690.1M in remaining performance obligations (RPO), of which 32% is expected to be recognized within 12 months. Additionally, the company has non-cancelable hosting service commitments with Google totaling $84.2M, with $18.0M due in the remainder of fiscal 2026 and $66.1M in fiscal 2027-2028.
No share buybacks or dividends were declared. Capital expenditures for the six months ended July 31, 2025 were $30.8M, consisting of purchases of property and equipment ($28.4M) and capitalized internal-use software ($2.4M). This compares to $28.0M in the prior year period.
Planet Labs operates as a single reportable segment. Revenue disaggregation by geography for the six months ended July 31, 2025: North America $60.6M, Asia Pacific & Japan $31.5M, Europe/Middle East/Africa $42.3M, Latin America $5.3M. By customer type: Civil Government $32.7M, Commercial $28.4M, Defense & Intelligence $78.6M.
Net loss of $35.2M was more than offset by strong operating cash flow of $85.1M, indicating high-quality earnings. The primary driver was a $75.8M increase in deferred revenue, likely from upfront customer payments. Depreciation and amortization ($21.7M) and stock-based compensation ($26.0M) were major non-cash add-backs. Working capital changes included a decline in accounts payable/accrued liabilities ($4.3M) and a modest improvement in receivables ($2.4M). Capex intensity (capex/CFO) was 36.2%, moderate for a capital-intensive business. Investing activities also saw net purchases of available-for-sale securities ($22.4M) offset by maturities and sales. Financing cash flows were negative due to tax withholdings on equity awards ($12.4M) and contingent consideration payments ($4.8M), partly offset by stock option exercises ($8.5M). Overall, cash position increased $62.9M to $192.9M. No free cash flow or capital returns were disclosed.