One Reason To Buy Planet Labs Stock
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Planet Labs (PL) is selling more to defense and intelligence agencies, and that may be what buyers of the stock are betting on. You probably know Planet for its daily satellite images of the Earth, but its customers are changing. Yet the stock lost 65.7% over the past six months while the S&P 500 gained 2.4%, and Planet still reports an operating loss. Growing defense sales and a falling stock do not fit together. So how fast is Planet’s defense business growing?
Planet’s Defense Customers Are Growing Fastest
Planet’s defense and intelligence revenue grew more than 90% from a year earlier in fiscal Q2 2027, the quarter ended July 31, 2026. Management said part of that quarter’s revenue beat came from the timing of a satellite handover, which landed in fiscal Q2 rather than fiscal Q3. Over the same quarter, commercial revenue grew more than 15% and civil government revenue over 5%. Total revenue reached $116 million, up 58.1%, and defense agencies are now the fastest-growing customers Planet has.
These agencies buy both data and satellites. The National Geospatial-Intelligence Agency awarded Planet a new $8 million contract in August to deploy Planet’s own Global Monitoring Service, and management said the company was the only vendor considered. The defense figure also includes satellite services, a business where Planet builds satellites that a government owns or directly controls. Management said the quarter’s revenue beat came mainly from this work, when Planet handed over its first Pelican satellite to the Swedish Armed Forces.
The satellite work could become much larger. Management said on the September 3 call that it has identified over $4 billion of satellite services opportunities, with about $1 billion of them near term. Those are opportunities, not contracts.
Planet Is Priced Far Above The S&P 500
At the November 9 close, Planet traded at 13.7 times its revenue over the past twelve months, against 3.1 times for the S&P 500. A buyer at that price is paying for growth, and defense is where Planet’s growth is fastest.
This defense work also appears in the profit figures. Management said the revenue beat from the Swedish handover helped adjusted EBITDA, its own profit measure, reach $13.9 million for fiscal Q2 2027, better than it expected. Based on reported figures, Planet’s operating loss narrowed to $13.5 million that quarter, down from $18.0 million a year earlier.
The defense contracts offer no answer to a separate worry about dilution. Planet’s diluted share count rose 30.7% in the three years to fiscal Q2 2027. In that quarter alone, the company raised about $120 million by selling stock, and management said it wants balance sheet flexibility while staying sensitive to dilution.
What Would Show Planet’s Defense Growth Fading?
Margins will move around too. Management said satellite services have a different margin profile from the rest of the business, so gross margin will vary from quarter to quarter.
Defense and intelligence agencies remain Planet’s fastest-growing customers, and their growth rate is the figure to watch when the company reports fiscal Q3 2027 results, expected in December 2026.
Does This Mean You Should Act On PL?
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