You could pass by Planet Labs’ offices on a peaceful section of San Francisco’s road without realizing that the structure within is, in a way, surveying practically the whole planet. The business doesn’t promote itself. It seldom creates the kind of buzz that SpaceX or even smaller defense-tech companies do. However, since going public in late 2021, PL stock has grown to be one of those tickers that long-term investors keep looking at, half out of curiosity and half because they think something intriguing is emerging.
Most likely, Planet began in a garage. An early belief that large, costly satellites were the wrong way to view Earth, three former NASA scientists, and a young Oxford researcher writing an entrepreneurial thesis about using cell phone chips to power tiny satellites. Fifteen years later, they are still producing a large number of small buildings. The AI-enabled satellites known as Doves, SuperDoves, SkySats, and now Pelicans have begun attracting sovereign clients like Sweden. It’s difficult to ignore how steadfastly this company has adhered to its initial concept: take daily pictures of the entire planet and let the data speak for itself.
The recent news is more significant than it first seems. Earlier this month, three new Pelican satellites were launched under a services agreement that combines hardware and continuous data delivery, including Sweden’s first sovereign military satellite. At the same time, new ESA-backed contracts with Greece and the Czech Republic were signed by Planet’s European subsidiaries. These multi-year, seven-figure agreements don’t seem like much on paper, but they subtly alter the revenue mix. In Europe, government contracts—particularly those related to defense—tend to be sticky. It is precisely this stickiness that PL stock has been lacking.
Owning this stock requires you to have faith in the company’s gradual transition from selling raw imagery to selling solutions, which is a harder but more lucrative game. Capex pressure still exists. Investors don’t want free cash flow to be this way. Additionally, government demand—especially from the US—has always been somewhat erratic; it can either quietly vanish from the next earnings call or boost a quarter. Investors appear to think that some of that is offset by the European victories. Perhaps they are correct.
As this develops, it’s remarkable how outdated Planet’s pace appears in comparison to the louder space-tech narratives. This isn’t a Twitter blitz or a rocket show. Just a constellation, expanding in orbit, with a customer list that now includes Norway’s climate initiatives, the FAO’s ecosystem monitoring framework, and a long list of organizations that covertly fund daily global updates. These same patient-money concerns once plagued Tesla. The parallel persists even though it isn’t perfect.
It is a real risk. In the end, the thesis is still unproven. A few more government deals could cause PL stock to suddenly re-rate, or it could drift sideways for an additional year. Looking back on this story, it seems like the company is in a better position than it has been since the merger. It is another matter entirely whether the market takes notice.
