A leader in daily Earth data and analytics Planet Labs PBC (NYSE: PL), reported strong Q1 financial results, highlighted by solid revenue growth, expanding margins, and a key financial milestone: positive free cash flow for the first time in the company’s history.
The company generated $66.3 million in revenue for the quarter, up roughly 10% year-over-year and ahead of expectations. Non-GAAP gross margin climbed to 59%, compared to 55% a year ago. Planet also posted adjusted EBITDA profitability for the second consecutive quarter at $1.2 million and delivered $17.3 million in cash flow from operating activities. Most notably, the company reported $8 million in free cash flow, marking a significant step forward on the path to long-term financial sustainability.
Key Drivers and Geographic Momentum
Growth was fueled by strong performance in Planet’s defense and intelligence segment, where revenue rose more than 20% year-over-year, reflecting heightened demand amid ongoing geopolitical tensions. Government customers drove higher-than-expected usage, and the company also made continued progress on its Japanese Space Imaging Agreement (JSAT) contract.
International momentum was particularly strong, with revenue in both the EMEA and Asia Pacific regions surging over 30% year-over-year. Meanwhile, revenues in North America and Latin America declined, contributing to some geographic variability.
Outlook for Q2 and Fiscal Year 2026
Looking ahead, Planet expects Q2 revenue between $65–67 million, non-GAAP gross margin of 56–57%, and an adjusted EBITDA loss of $2–4 million. For the full fiscal year, revenue is projected between $265–280 million, with a non-GAAP gross margin of 55–57% and an adjusted EBITDA loss between $7–12 million. The company anticipates $50–65 million in capital expenditures for the year.
Despite modest near-term EBITDA guidance, the company remains bullish on long-term growth, citing strong demand across both its core data and analytics offerings and satellite services. Executives emphasized that demand is particularly high for security, monitoring, and maritime domain awareness solutions—especially in Europe and Asia.
Highlights and Concerns from the Earnings Call
During the Q&A session, Planet leadership pointed to several bright spots:
- First-ever positive free cash flow as a major company milestone.
- Surging demand from the defense and intelligence sector due to increased global instability.
- An eight-figure annual contract value (ACV) expansion for maritime awareness with a European government.
- Progress in satellite services, with multiple strategic deals in development.
However, the call also revealed a few potential challenges:
- Uncertainty around NASA’s EOCL program budget could affect Planet’s government contracts. While management believes its cost-effective solutions position it well, the risk remains.
- Variability in customer usage patterns, as clients may reduce usage during budget-tight periods, creating potential revenue fluctuations.
The post Planet Labs Delivers Strong Q1 with First-Ever Positive Free Cash Flow and Robust Global Growth, Shares Skyrocket Over 50% appeared first on PRISM MarketView.