Planet Labs Rides a Wave of European Defense Deals and New Satellites — But Can a $14 Billion Valuation Hold Up?
Shares shifted sharply higher as Planet Labs extended a blistering rally, trading at $43.48 (+4.5%) in pre-market Monday. The move follows Planet's successful launch of three AI-enabled high-resolution satellites — including Sweden's first sovereign military satellite — and fresh ESA-backed, multi-year contracts with Greece and the Czech Republic . The stock is up roughly 22% in days, and investors are betting that Europe's rearmament push turns Planet from a niche imagery vendor into a defense essential.
Europe Is Paying for Its Own Eyes in the Sky — And Planet Is the Vendor
Planet secured a multiyear contract worth approximately $280 million (€240 million) to supply satellite imagery and geospatial intelligence to the German government , and a multi-year, low nine-figure deal with the Swedish Armed Forces . European nations are investing more heavily in their own surveillance infrastructure amid shifting geopolitical realities and pressure from Washington to increase defense spending . In fiscal year 2026, 59% of Planet's revenue came from defense and intelligence customers , making this pipeline existential, not supplementary.
A $900 Million Backlog Gives Revenue Visibility — But Demands Execution
Backlog surpassed $900 million (+79% year-over-year), with remaining performance obligations up 106% to $852 million . Guidance for FY2027 projects revenue of $415–$440 million , roughly 39% growth at the midpoint. That's promising, but the company is forecasting a decline in adjusted EBITDA — a measure of operating profit before accounting adjustments — guiding between breakeven and $10 million , down from $15.5 million last year. Growth is being prioritized over profits.
Nine Satellites Up, But the Valuation Is Already in Orbit
Nine AI-enabled high-resolution satellites are now in orbit , with plans to launch additional satellites, including a next-generation model with sharper 30-centimeter resolution, later in 2026 . Planet's market capitalization now sits at approximately $14.8 billion , and its price-to-sales ratio stands at 40.75 — far above the industry median of 4.42 . That means investors are paying today for years of future growth that must materialize flawlessly.
The Big-Picture Risk: Contract Concentration in a Volatile Sector
While sovereign satellite deals help offset some volatility, investors should watch how dependent Planet remains on a relatively small set of large government contracts . With Q1 FY2027 earnings due June 4, the market will soon test whether this momentum is built on durable fundamentals — or geopolitical euphoria with a short shelf life.