Planet Labs (NYSE:PL) reported first-quarter financial results on Thursday. The transcript from the company's first-quarter earnings call has been provided below.
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Access the full call at https://events.q4inc.com/attendee/433648654
Summary
Planet Labs PBC reported record revenue of $94 million for Q1 FY2027, a 42% year-over-year increase, with a non-GAAP gross margin of 56% and a notable backlog of $906 million, marking a 72% growth year-on-year.
The company signed significant contracts, including an eight-figure deal with an international defense customer and various contracts with U.S. government agencies, highlighting strong demand in the defense and intelligence sectors.
Planet successfully launched three Pelican satellites, including Sweden's first sovereign reconnaissance satellite, demonstrating their rapid deployment capabilities.
The company is leveraging AI to enhance its product offerings, including the private beta testing of an AI app for querying their data archive and the introduction of a new feature called Super Res.
Future guidance includes Q2 revenue expectations of $102-107 million and full-year revenue projections raised to $425-441 million, maintaining a focus on strategic investments in satellite services and AI solutions.
Full Transcript
OPERATOR
If you would like to ask a question, please press Star one to raise your hand to withdraw your question, please press Star one again. I will now hand the conference over to Cleo Palmer Poyner, Director of Investor Relations. Please go ahead.
Cleo Palmer Poyner (Director of Investor Relations)
Thanks Operator and hello everyone. Welcome to PlanIt's first quarter of fiscal year 2027 earnings call. I'm joined by Will Marshall and Ashley Johnson who will provide a recap of our results and discuss our current outlook. We will we encourage everyone to please reference the earnings press release and earnings update presentation for today's call which are available on our investor relations website. Before we begin, we'd like to remind everyone that we will make forward looking statements related to future events or our financial outlook.
Any forward looking statements are based on Management's current outlook plans, estimates, expectations and projections. The inclusion of such forward looking information should not be regarded as a representation by Planet Labs that future plans, estimates or expectations will be achieved. Such forward looking statements are subject to various risks and uncertainties and assumptions as detailed in our SEC filings which can be found at www.secfilings.com.
our actual results or performance may differ materially from those indicated by such forward looking statements and we undertake no responsibility to update such forward looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. During the call we will also discuss historic and forward looking non GAAP financial measures. We use these non GAAP financial measures for financial and operational decision making and as a means to evaluate period to period comparisons.
We believe that these measures provide useful information about operating results and enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. For more information on the non GAAP financial measures, please see the reconciliation tables provided in our press release issued earlier today which is available on our website at investors.planet.com Further, throughout this call we provide a number of key performance indicators used by management and often used by competitors in our industry.
These and other key performance indicators are discussed in more detail in our press release and earnings update presentation which are intended to accompany our prepared remarks. At this point, I'd now like to turn the call over to Will Marshall, Planet CEO, Chairperson and Co Founder. Over to you Will.
Will Marshall (Co-Founder & CEO)
Thanks Cleo and welcome everyone. Joining us today, Planet had another excellent quarter, delivering record revenue and signing an eight figure deal with an international customer. We also successfully launched three additional Pelican satellites including one for Sweden, their first Sovereign reconnaissance satellites just four months after contract signing. To briefly summarise the results, we generated a record $94 million in revenue representing approximately 42% year over year growth.
Non GAAP gross margin was 56% for the quarter. For the third sequential quarter we achieved rule of 40 which is our revenue growth rate plus adjusted EBITDA margin. End of period backlog was approximately $906 million, equating to approximately 72% growth year on year. Defense and intelligence continues to be an area of strength for us, underpinned by the geopolitical backdrop. First quarter DNI revenue grew over 65% year on year driven by strong performance in our data, subscription solutions and satellite services.
I'd like to highlight a few recent customer wins with the US government. We were awarded a six month $7.5 million contract renewal by the US Navy for vessel detection and monitoring over key areas of interest throughout Pacific as we announced earlier today, the US National Geospatial Intelligence Agency, the NGA, awarded Planet A $21.9 million one year contract extension for maritime surveillance under the LUNO B IDIQ for advanced analytics for maritime operations and reconnaissance.
We also received a new award from the NGA for our global monitoring service to support crisis response. These awards reinforce the US Government's commitment to integrating commercial AI enabled geospatial intelligence into its national security architectures. They underscore our position as a vital partner for customers seeking persistent monitoring to accelerate critical decision making in a complex arena. We're very proud to have received these awards and eager to deliver for this critical customer.
We also continue to see robust international government demand driven by the aforementioned geopolitics. Nations are articulating an urgent imperative to secure sovereign access to space, understand threats in their region, modernize their defence capabilities and maintain their strategic edge. For example, we signed a new dedicated capacity deal with an international defence and intelligence customer. This eight figure one year contract will give the customer immediate access to dedicated capacity from our satellites in orbit, as well as advanced analytical solutions integrated across our Pelican, Skysat and PlanetScope constellations.
And also we're making excellent progress executing against our previously announced satellite services deals. To highlight one prominent example, last month we successfully launched the first Pelican for the Swedish armed forces. Critically, the launch occurred just four months after we were awarded the contract. Members of the Swedish delegation attended the launch of Vandenberg and they expressed their excitement and national pride in launching Sweden's first ever sovereign reconnaissance satellite.
We're incredibly proud to have delivered it for them and look forward to what we hope is a long and fruitful partnership. We're continuing to focus on execution and delivery for our international customers across the board. We believe our ability to ramp them quickly and address their most urgent needs, whether through immediate dedicated capacity or speedy launch to orbit, continues to be a key differentiator for us. With our reliable track record and agile aerospace approach, we're able to deliver a suite of solutions that meet our customers critical needs Turning to the civil government sector where first quarter revenue was roughly flat year
over year primarily due to the reduction in our contract with NASA. In spite of that headwind, we've seen some strong momentum with our customers in Europe. To share some recent highlights, we were awarded a two year seven figure agreement with the Greek government in support of the country's national satellite space project. Signed through the European Space Agency on behalf of the Hellenic Ministry of Digital Governance and the Hellenic Space center.
This contract will support historical change analysis, trend detection, rapid response during critical events and the integration of satellite data international monitoring workflows. We won a two year seven figure contract to provide satellite imagery and AI powered analytics to the State Agricultural Intervention Fund of the Czech Republic. This deal will support the countrywide agricultural payments and monitoring system serving approximately 25,000 agricultural holdings across the Czech Republic.
Last but not least, we onboarded the Scottish Agriculture and Rural Economy Directorate with our partner computer center following a seven figure award closed at the end of Q4 for Planet Script data and advanced analytics to support the agricultural reform. Route Map, Plan's deep archive of data and AI analysis will aid in the country's agricultural transition by rewarding farmers who focus on sustainable food production, biodiversity and net zero emissions.
Then in April, Planet was awarded a John Deere Supplier Sustainability Award for 2025. This award highlighted the value of our data empowering next generation precision agricultural technologies, helping to improve on farm efficiency and positive environmental impact For John Deere, we renewed our customer nave analytics. Since 2022 we have partnered with NAVE to incorporate our planetary variables such as our surface, soil, moisture and biomass proxy into their data fusion framework.
Last but not least, our investments in AI position Planet at the forefront of the industry, making planetary scale insights accessible and actionable to more users than ever before. With that, I'll turn over to Ashley to discuss our financials. Over to you Ashley.
Ashley Fieglein Johnson
Thanks Will. The year is indeed off to a strong start and it's exciting to see the acceleration across the business. Before I dive into the financials, I want to take a brief moment to reflect on my recent trip to Panama for our Planet on the Road customer conference. It is hard not to start with one of our most impactful programs, the work we've been doing with our long term partner SCCON and the Brazilian government to fight illegal deforestation.
Attendees hailed from 20 different countries, providing a fantastic opportunity to connect directly with our customers and partners, the people who are leveraging our data to help solve some of the planet's most pressing challenges. Now turning to our financial results, revenue for the first quarter came in at a record $94 million representing approximately 42% year over year growth. The outperformance in the quarter was driven primarily by new wins.
During the first quarter, our defense and intelligence sector revenue grew more than 65% year on year, the commercial sector was up more than 20% year on year and civil government revenue was approximately flat. Turning to our regional revenue breakdown, growth continues to be distributed around the globe. During the quarter, revenue growth was approximately 25% year over year in Asia Pacific and North America, 86% in EMEA and 7% in Latin America.
Approximately 92% of our end of period ACV book of business consists of annual or multi year contracts. Net dollar retention rate at the end of the first quarter was 113% and net dollar retention rate with winbacks was 114%. Our non GAAP gross margin for the first quarter was 56% compared to 59% in the first quarter of fiscal 26 reflecting investments in support of our satellite services contracts, new satellite launches and our AI enabled partner solutions.
At the end of Q1, our remaining performance obligations or RPOs were approximately $816 million up over 80% year over year, of which approximately 35% apply to the next 12 months and 66% to the next 24 months. We estimate our backlog, which includes contracts with a termination for convenience clause, to be approximately $906 million up approximately 72% year over year. Approximately 40% of our backlog applies to the next 12 months and 69% to the next 24 months.
We are well positioned for a year of delivering durable revenue growth and sustainable annual free cash flow, building our momentum as the indispensable data layer for a changing world. Will and I are once again blown away by the excellent performance and constant innovation of the Global Planet team. Thank you for all that you do. Operator. That concludes our comments. We can now take questions.
OPERATOR
Thank you. We will now begin the question and answer session by Please limit yourself to one question and one follow up. If you would like to ask a question, please press Star one to raise your hand to withdraw your question, please press Star one. Again, we ask that you pick up your handset when asking a question to allow for optimum sound quality and if you are muted locally, please remember to unmute your device.
Please stand by while we compile the Q and A roster. Your first question comes from the line of Colin Canfield from Cantor. Your line is now open.
Colin Canfield
Thank you.
Ashley Fieglein Johnson
It is balanced geographically. Then I think planet's well positioned. Anything you'd add will?
Will Marshall (Co-Founder & CEO)
No, I mean I think it's just we're seeing really robust demand here and we said last time how that had increased in at least quality, qualitative way and both in size and in number of deals. And as she was pointing out, I mean what we have here is that we can execute really fast. Countries really like that, they can get immediate access to a satellites are in orbit for both the data and enabled solutions and quickly get sovereign satellites up in space.
So that's unprecedented in the sector. It speaks to our differentiation and that's why governments are coming to Planet Labs for that kind of solution.
Colin Canfield
That's great. No, I appreciate the color and maybe pivoting over to data centers. If you could talk about any color on initial discussions that you and Google are having with the chip suppliers and then maybe talk about kind of what do you think are the key engineering signposts that investors should look for as planet on ramps for orbital compute?
Will Marshall (Co-Founder & CEO)
And you see, you know, there's a lot of players going into it and we think Planet is well positioned because of our history of doing hundreds of satellites before. One of the few players that has done that. We've already put fast computers, GPUs, Nvidia GPUs in space. We already do a lot of stuff with AI as you're aware. And so we're well positioned for this sector.
Colin Canfield
That's great. Thank you. Thank you.
OPERATOR
Thank you for your question. Your next question comes from the line of Edison Yu from Deutsche Bank. Edison, your line is now open. Please go ahead.
Edison Yu
Great. Thank you for taking our questions. Wanted to first follow up on the overall data center. In your kind of early work around the engineering, do you have a sense on what kind of compute density is realistic in the next couple of years? And I think the framework has been thrown around a sort of kilowatts per ton. And so any sense on what you guys are seeing there? Is it realistic to be like 80, 100? I'll stop there for now.
Will Marshall (Co-Founder & CEO)
So again, early days, but those are the kind of problems we're tackling.
Edison Yu
Understood. And then I wanted to ask you about the essay you put out very
Will Marshall (Co-Founder & CEO)
recently on planetary intelligence. Yeah. Yes. And you know, obviously I think some very profound and I think thought provoking, you know, ideas, I guess, in a more kind of operational sense. What do you think is kind of the next, call it two or three years. How do we see that sort of manifest either in the business or in industry? Like what are some paths you could envision to see that manifest more on a commercial or operational basis?
Like it's natural that sensing at the planetary level is done in space. We've done that for years. The compute is going to follow and they will lead into this new planetary intelligence era. But way before that, like right now, Earth imaging data and other sort of space data sets and AI enabling us to do more real world models, more real world models open up real world applications on the ground today in farming, in energy, in insurance and so on.
You know, most of the entities that we serve today are big governments, big enterprise commercial players and this in principle can enable that to be lowered. Right. And I think that's the most exciting thing now. And so that's what we're mostly focused on. But it's cool to do the tech demos for compute in space as well because the long term that could be very exciting too.
Edison Yu
Thank you very much. Great, thanks, Edison.
OPERATOR
Your next question comes from the line of Jeff Van Re from Craig Hallam Capital Group. Your line is now open.
Jeff Van Re
Great, thanks for taking the questions. Will, on the AI side. Interesting, exciting. You've got the beta program now up with a natural language query. Can you just talk about the scope of the trial, how many participants, you know, thoughts on when that goes ga, and I'd love to hear is kind of maybe in your mind, what are a couple of more compelling use cases you're seeing people playing with right now?
Will Marshall (Co-Founder & CEO)
And that's really great for these AI models.
Jeff Van Re
Yeah, I mean I think it certainly has the potential to break open the commercial and civil tams for you. Maybe one last quick one for you on the, you know, Pelican 1's up and up and ramping nice nicely 50 centimeters. You talked about the tech demo on Pelican 2 going to 30 centimeters.
Just any crude swags on kind of based on prior experience, how long you would expect a tech demo for and broad brush, you know, sort of strokes on when you think those Falcon two start going up commercially.
Will Marshall (Co-Founder & CEO)
Ashley Fieglein Johnson
Yeah, I think it's important just to highlight that across our satellite fleets, as you know we tend to repurpose a lot of the components. So there's a lot of commonalities even as we iterate on various aspects, whether that's, you know, improving latency, improving the payload for resolution. So that enables us to have a much faster pace of iteration than you might typically see in hardware iterations, especially in space.
So I would say stay tuned, there's a lot of fun stuff coming.
Jeff Van Re
Great, great. Thanks so much. Thanks.
OPERATOR
Thank you.
Your next question comes from Mike Latimore from Northland Capital Markets. Your line is now open.
Mike Latimore
All right, great. Yeah, thank you. Congrats on the quarter. You know, over the last Several quarters. You've highlighted Europe as being an area of, you know, urgency and increasing demand. I guess. Is that still kind of the best, the most hot spot within the pipeline or is the pipeline urgency broadening?
Will Marshall (Co-Founder & CEO)
So we're really leaning into that, that market Opportunity, Planet Labs is well positioned that as well.
Mike Latimore
Great. And then on the commercial side, nice change in the trajectory there this quarter. Are the drivers of that change sustainable or was there some one offs this quarter? How should we think about commercial?
Will Marshall (Co-Founder & CEO)
I think it's very sustainable and one of the things about the agriculture partnerships that we mentioned is that we've really turned it around to a point where we really aligned that business model with the agricultural partners that we're doing with like the John Deere piece that we announced as they do well, we do well and that. So you know, we took a reset in that area but now we're growing it and so we feel good.
I'm very happy about that growth as well. Ashley, anything to add?
Ashley Fieglein Johnson
Yeah, I would just say, you know, the comments that we made earlier both around the AI solutions that we have like things like GMS or MDA as well as, you know, this beta of a new natural language based interface is really enabling us to engage with customers that haven't historically really thought about how they might integrate Geographic Information System (GIS) into or Geographic Information System (GIS) data sets into their modeling and analysis.
So we remain very optimistic about how the commercial sector can, can be a major growth factor for us in the years to come.
Mike Latimore
Great, thank you.
OPERATOR
Thank you.
Your next question comes from the line of Christine Leweg from Morgan Stanley. Your line is now open.
Gabby Nofelman
Hi, this is Gabby Nofelman on for Christine. Thanks for taking the question and congratulations on the quarter. Since last quarter, Planet moved from a 14 day delay in Middle east imagery access to an indefinite restriction for imagery in the conflict region. Have you seen any change in customer behavior as a result?
And since the news came out in early April and with recent ceasefire talks, is there any anticipated timeline or framework for restoring satellite imagery access in the Middle East?
Will Marshall (Co-Founder & CEO)
And that means that articles continue to happen in the press as well.
Gabby Nofelman
Got it. That's super helpful color. Thank you for the clarity and a quick follow up. Defense and intelligence is clearly becoming a larger portion of revenue and has been the fastest grower for quite some time now. But you also highlighted some nice civil government and commercial wins during the quarter. I mean, as we look ahead, how should we think about the size and growth of civil and commercial relative to, to defense and intelligence.
Will Marshall (Co-Founder & CEO)
Well, I think that's an excellent question. And the way I view it is long term, I believe the civil and commercial sectors will be bigger than defense intelligence. We're obviously leaning into defense intelligence right now because there is such strong demand and it makes sense for us to lean in there. We've very needed. But as we just talk about AI that helps us unlock these other areas, I think that's the right way to think about it.
It helps us to accelerate that. And yeah, I mean just the breadth of use cases in commercial, all the sectors we've talked about before, we believe that many tens of billion dollars of TAM to go after in commercial and civil. And so we're going to go after those. But I think for the immediate focus, defense and intelligence is the best place to focus because there's such strong demand
Ashley Fieglein Johnson
and also very sophisticated customer that provides us with feedback that helps make our solutions even stronger and we think ultimately much more broadly applicable. Great. Thanks so much.
OPERATOR
Thank you for your question. In the interest of time moving forward, please limit yourself to one question. Your next question comes from the line of John Gooden from Citi. Your line is now open.
Jeremy Jason
Hi, this is Jeremy Jason on for John Gauden. Congrats on the quarter. I just kind of wanted to ask what are the upcoming milestones for the key programs that you're looking forward to, just for clarity's sake. And can you provide any color on like the timeline for those?
Which key programs are you referring to involvement in? For example, owl. You guys mentioned on the prepared remarks?
Will Marshall (Co-Founder & CEO)
It's still being built right now. It's early days, so we'll let you know when there's updates.
Jeremy Jason
Thank you so much.
OPERATOR
Thank you.
Thank you for your question. Your next question comes from the line of Trevor Walsh from Citizens. Your line is now open.
Trevor Walsh
Great, Hal, thanks for taking the question. Will. And maybe Ashley, if you want to add as well. There was a smaller competitor, but a competitor that announced a win in late April, kind of end of your quarter of their own satellite sovereign deal much smaller than anything you guys have booked.
But I was just curious if you're seeing just based on your own success and that being pretty widely known and publicized, if you're seeing more competition specifically in that space, kind of working for, you know, government agencies, international, etc. And then kind of relatedly, is there a minimum deal size that you all would entertain as far as structuring more where the, where the sovereign or the entity owns the actual satellite?
So something more in a JSAT kind of realm. Thanks.
Will Marshall (Co-Founder & CEO)
Yeah, good question. So, I mean, look, I don't think competitive landscape has changed very much. I don't know which deal you're referring to, but obviously there are other players that can build Earth imaging satellites for countries.
But really our differentiators I mentioned is proven track record, having launched hundreds of satellites doing earth imaging before, and the speed of delivery, the speed of delivery in months rather than years, sometimes decades for these systems. And also cost performance, I would add, you know, having had that long track record, we've got the cost down of our satellites a lot. So sometimes, you know, these things are radically lower cost.
We might be launching 10 satellites at the same cost as people were before or companies were before, launching just one or more. And so, you know, that, that is all those differentiators make us strong in the market and we haven't had too many cases where we see others competing with us. We feel pretty strong.
Ashley Fieglein Johnson
I would just add, you know, we're able to compete on all of the points that will just made in terms of, you know, speed and performance and cost effectiveness.
And we can very cost effectively get them up and running through, you know, a dedicated capacity service or tasking credits so that they immediately are getting the eyes that they need to understand what's going on around them.
So it's not just the ability to be best in class in delivering satellites, which obviously we are, but it's also the fact that we have the network of satellites and capabilities, the daily scan and the analytic solutions on top of it that bring value on day One.
OPERATOR
Thanks. Both.
Thank you.
Ryan Koons
Your next question comes from the line of Ryan Koons from Needham Co. Your line is now open.
Ashley Fieglein Johnson
Great, thanks. Question for Ashley on gross margins. Surprised again to the upside here. Maybe give us a bridge or unpack what the upside was on mix. Obviously satellite services deals. Are those lower margins not contributing as much? Maybe help unpack the mix a little bit for us. Thank you.
very quickly. So the business model that we have, we're delivering data comes at relatively low marginal cost. Means that when we drive upside on revenue, you see that fall to the point bottom line and it, you know, in this case it definitely stopped by gross margin along the way and drove up. And Ashley, that was for your deal you signed in this quarter.
That's right.
Ryan Koons
Great, thanks.
OPERATOR
Thank you.
Stephen Varhaftig
Your next question comes from the line of Stephen Varhaftig from Wedbush Securities. Your line is now.
Ashley Fieglein Johnson
Thanks for taking the question. Congrats on the quarter everybody. So Ashley, just a question for you because it seems like there's a lot of different focuses for capital investments. You're thinking about the R and D for new AI enabled solutions. You're thinking about the CapEx ramp. I mean you really do have a strong balance sheet. So what would you say is the priority from a capital allocation perspective?
And then if I can add just one more onto that, is the company still looking at M and A opportunities? I know they, that you haven't shied away from it, but want to get a little more color on that opportunity. Thanks.
And we are never short on ideas, but we always have the customer at the center of what we do and our understanding what do customers need that can, can really unlock market opportunity for us. So I'd say the investments that we're making are really prioritizing growth and market capture. So how can we sustain or even expand our growth rates and then continue to drive high margins?
And you know, we gave The Rule of 40 framework, you know, revenue growth rate plus EBITDA margin as you know, one way that we think about making sure that we're balancing making these investments, but also running a good business that generates profits, that generates free cash flow and always has an eye to how with scale, our profit margins and free cash flow margins can expand.
So a lot of exciting things, incredibly innovative teams, but also, you know, really doing it in service of market capture and delivering value to customers.
Will Marshall (Co-Founder & CEO)
And on the M and A side that you brought up, we're mainly focused on execution and have most of what we need. We will do things like the bedrock acquisition that we did that enhances our AI powered solutions in really good ways and that team's working really well by the way, and very integrated into our AI powered solutions, especially in the defense intelligence space.
We'll continue to look out for things that could be accretive, especially to the core business product or business synergies. But again, I think we have most of what we need and so we're many heads down focused on executing on the deals we have.
Stephen Varhaftig
Got it. Thank you.
OPERATOR
Thank you.
Greg Pendy
Your next question comes from the line of Greg Pendy from Clear Street. Greg, your line is now open.
Will Marshall (Co-Founder & CEO)
Hey guys, thanks for taking my question. Just a real quick one as you have so many things that's going on, especially later in this year with the first AL and then subsequent launches to fall in 2027. Are there any stress areas in either the supply chain or launch that could move things around? Thanks.
Ashley Fieglein Johnson
And so we're excited about them, we're excited about what they can offer as well and increased competitiveness in the launch sector. As for supply chain. Nothing material to point out but one of the things we look at is buying down risk in supply chain by procuring components and that's one of the reasons that we're focused more on growth then profitability, where we need to do that to show up risk. Anything to add to that?
No. I would just say in some of our prior quarters we've talked about the fact that we've taken up our capex capital expenditures specifically to make sure we're looking at those areas where we can buy in advance to de risk any supply chain but also get better pricing by buying more up front. So it is something that we keep an eye on and manage I think quite successfully. And generally speaking the team has a very resilient supply chain.
Greg Pendy
That's very helpful. Thanks a lot.
OPERATOR
Thank you.
Thank you. That's all the time we have for questions today. I will now turn the call back to Will Marshall, CEO and co founder for closing remarks.
Will Marshall (Co-Founder & CEO)
We did a super resolution, the beta stage of our app and investing in AI is unlocking a lot of the value latent in our data. So really proud of the work done in this quarter that led us to all these results and so thank you to the incredible team and all the efforts they do to enable this. Thanks a lot for tuning in.
