Shares of Planet Labs rocketed over 12% after the satellite imaging company inked a major multi-year deal with Sweden’s Armed Forces. The move adds to a flurry of government contracts that have helped push the company's stock up more than 25% this year.
Strong Demand from Governments Fuels Growth
Planet Labs, a San Francisco-based satellite imaging firm, has been snapping up government contracts at a rapid pace. Its latest deal with the Swedish Armed Forces marks the third major government contract in just a year, following agreements with Japan and Germany. Together, these contracts are worth over half a billion dollars, signaling robust demand for Planet Labs’ satellite data services across national security agencies.
The Swedish contract involves providing a suite of satellites and space-based data to enhance the country’s security operations. This fits into a growing trend where governments worldwide rely on satellite imagery for defense, surveillance, and disaster response.
In 2025, Planet Labs also secured contracts with NATO, the European Space Agency, and NASA, including a $13.5 million task order for commercial satellite data. The company renewed its partnership with the U.S. Navy to supply Earth observation data, reinforcing its foothold in government space applications.
AI and Satellite Tech: A Winning Combo
Planet Labs is betting heavily on artificial intelligence to unlock new business opportunities. The company is collaborating with Google on the Suncatcher project, which integrates AI and machine learning technologies with satellite operations.
The goal is to improve the analysis and utility of Earth observation data, making it more valuable for customers.
Planet Labs recently launched two Pelican satellites and 36 SuperDove Earth-imaging satellites, expanding its fleet and data collection capabilities. With this expanded satellite network, the company aims to offer more frequent and detailed imagery, which AI tools can then process to generate actionable insights.
Investors have rewarded the company’s AI push and satellite expansion. Planet Labs’ stock has soared nearly 400% since its 2021 public debut via a special purpose acquisition company. The market valuation now stands at $6.2 billion, reflecting growing confidence in the company’s growth trajectory.
Volatility and Profitability Challenges
Still, the stock has been volatile. Over the last year, Planet Labs’ shares have experienced 58 moves greater than 5%. The biggest recent dip came after an earnings report that beat revenue expectations but missed on earnings per share. The company posted an EPS loss of $0.19 versus the consensus estimate of negative $0.02, raising concerns over profitability.
Despite these concerns, Planet Labs kept its financial guidance steady. Analysts remain mixed, with a consensus rating of 'Hold' and an average 12-month price target around $22. Morgan Stanley recently maintained an 'Equal-Weight' rating with a $26 price target, reflecting cautious optimism.
Expanding Civil and Commercial Reach
Government contracts aren’t the only growth driver. Planet Labs recently signed an enterprise-scale deal with Slovenia’s surveying and mapping authority. The agreement provides satellite data and high-resolution tasking to support forest monitoring, urban planning, and disaster response efforts including wildfires and droughts.
The move into civil public administration demonstrates the broadening appeal of satellite imagery beyond defense. Governments and municipalities are increasingly seeking real-time spatial data to manage environmental challenges and land use more effectively.
On the commercial side, Planet Labs continues to expand its backlog of orders, more than tripling it year-over-year. The company’s ability to grow its customer base and launch new satellites positions it well for long-term growth, but profitability remains elusive.
Planet Labs’ stock surge reflects growing market confidence in its expanding satellite fleet, government contracts, and AI-driven data solutions. But the company’s ongoing losses and share price swings highlight the risks that come with rapid growth in a cutting-edge industry.
