Today we dive into Planet Labs (NYSE: PL), the satellite imaging company that’s putting eyes in the sky and data in your hands.
If you’ve looked at this stock lately, you might be wondering whether it’s ever going to lift off or just orbit the same price range forever.
But 2025 may finally be the year things start moving. And no, this isn’t just another “it’s got potential” pep talk. The satellite firm actually putting up some numbers that are hard to ignore.
Revenue Is Finally Starting to Show Some Gravity
In Q1 2025, Planet Labs reported revenue of $61.6 million. That’s a 4.6 percent jump from the same quarter last year. More importantly, it was their best revenue growth since they went public. That might not sound like a moonshot, but in a business where government contract delays and long sales cycles are the norm, that kind of growth is nothing to sneeze at.
And it’s not just the top line. Gross margins climbed to 62.1 percent. That’s near the highest it’s ever been. Management chalked it up to better pricing power with new analytics products and a shift toward higher-margin enterprise contracts. So yes, they’re not just selling satellite pictures anymore. They’re bundling up data and selling it like a SaaS company.
Here’s Where Things Get Interesting
Planet recently closed a multi-year agreement with the U.S. Department of Defense valued at over $120 million. That deal alone is expected to add around $30 million in revenue this year. And that’s not theoretical, the first payments started hitting the books in Q2.
You know what else hit? The stock. Shares climbed 14 percent the day after the announcement. That was the biggest one-day move since a couple of years ago. Clearly, Wall Street paid attention.
The contract is also a credibility boost. If the Pentagon trusts your geospatial data, private enterprise probably will too. That’s already showing up. Planet said its commercial pipeline is up year-to-date. That doesn’t mean those deals are done yet, but it does mean more customers are kicking the tires and that’s step one.
Cash Burn Is Still a Thing
Okay, so here’s the not-so-fun part. Planet is still losing money. In Q1 2025, the net loss was $19.4 million. That’s down from $34 million the year before, so there’s progress. But this is not a profitable company yet.
They’re sitting on around $270 million in cash though, and they reiterated that they don’t expect to raise additional capital this year. That matters. No shareholder wants to see dilution when a stock is already struggling. So if they can hold the line on costs and inch closer to breakeven, sentiment may start to shift.
Honestly, the next two quarters are make-or-break here. If they hit revenue targets and bring losses down again, investors may start to rerate the stock.
Analyst Price Targets Are Cautiously Optimistic
The latest analyst coverage from May 2025 pegs the average 12-month price target at $5.80. That’s about 63 percent higher than where the stock sits today. Some firms like Needham and Benchmark are even more bullish, setting targets near $6.
The bull case is encroaching into agriculture, energy, and climate-related services. Those verticals are hungry for real-time earth data and aren’t as price-sensitive as you might think. Planet’s machine learning overlay tools are actually getting better at turning pixels into actionable insights. That’s the kind of stuff that commands recurring revenue—and recurring revenue gets Wall Street excited.
Bear case? Still too early. Still not profitable. Still a lot of big picture headwinds when it comes to enterprise tech spending. You can see why it’s been stuck in the $3 range for months.
Institutions Are Warming Up
One thing that stood out in Planet’s latest 13F filings, hedge funds are nibbling again. ARK Invest added shares in both its space ETF and innovation fund. That’s not a full endorsement, but it’s not nothing.
More notably, BlackRock increased its stake by 12 percent in Q2 2025. That’s the kind of long-term investor that doesn’t chase headlines. They see something. It may just be the valuation, which is still under 3x forward sales. That’s dirt cheap for a data company with double-digit revenue growth.
Is that enough to spark a rebound? It might well be but we need one more strong quarter to convince the fence-sitters.
And There Is One More Thing
There’s also a bit of an overlooked story happening here. Planet recently launched a partnership with NVIDIA to improve on-orbit processing. Basically, they want to start analyzing images directly from the satellites instead of sending raw data back to Earth first.
It matters for various reasons. Speed. Usefulness. Scale. If they pull it off, they can serve clients in near real-time. Think: natural disaster response, crop monitoring, border surveillance, stuff where every minute matters.
That may very well open the door to new use cases and customers. And it may help Planet charge more for faster results. Honestly, that surprised me. It’s not the kind of innovation you usually hear from a company still trying to hit breakeven.
How High Will Planet Labs Stock Go in 2025?
Alright, let’s crunch a few back-of-the-envelope numbers. If Planet hits its 2025 guidance of $250 million in revenue and starts getting recognized as a proper data-as-a-service company, a 5x sales multiple isn’t crazy. That puts the share price closer to $6.20 per share.
Right now it’s trading nearer the mid-3s. So we’re talking about an 80 percent gain if that valuation rerating happens. And that doesn’t even factor in a potential government expansion order or new enterprise client wins.
With a 3.5x multiple, you’re still looking at a share price around $4.30. That’s a decent 26 percent upside, and it assumes no major surprises, just solid execution.
The stock isn’t a sure thing, but the upside may be too tempting to ignore. Planet Labs is finally be ready for liftoff and it’s up to management now to deliver.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.
