TLDR
- Rocket Lab stock fell 6% on Monday despite successfully completing its first dedicated launch for Japan’s space agency JAXA
- The company completed its 19th mission of 2025, setting a new annual launch record
- Investors remain concerned about the timeline for Neutron rocket’s first flight and future profitability
- Shares traded as low as $56.20 on Sunday, down 11.8% from the session’s peak of $64.56
- Rocket Lab has two more launches planned for JAXA and another mission scheduled with the European Space Agency
Rocket Lab shares took a beating this week, falling roughly 6% on Monday morning despite what should have been a victory lap. The company just completed its first dedicated launch for the Japan Aerospace Exploration Agency, but investors weren’t in a celebrating mood.
The mission, called RAISE And Shine, lifted off from Rocket Lab’s New Zealand launch site on December 14. The Electron rocket deployed the RAISE-4 satellite into orbit without a hitch.
The satellite will test eight new space technologies developed by Japanese companies under JAXA’s Innovative Satellite Technology Demonstration Program. It’s exactly the kind of high-profile government contract that companies like Rocket Lab dream about.
But the market has other things on its mind. Shares traded in a wide range on Sunday, hitting a low of $56.20 and a high of $64.56 before settling at $56.92.
That put the stock 11.8% below the session’s peak. The trading volume of 18.26 million shares came in below the company’s average daily volume of 22.71 million.
Launch Success Meets Margin Pressure
The JAXA mission was Rocket Lab’s 19th launch of 2025, extending an annual record the company set earlier this year. The Electron rocket is designed for small satellites that need precise, dedicated access to space.
Rocket Lab has one more launch planned this month from its U.S.-based Launch Complex 2. The company also has a second dedicated Electron mission scheduled for JAXA in early 2026.
A separate Electron mission for the European Space Agency is on the books for next year. The company’s launch backlog continues to grow with government-backed customers.
But analysts say the selloff reflects deeper concerns about Rocket Lab’s business model. The company is burning cash while racing to develop its larger Neutron rocket.
Investors want clearer proof that Rocket Lab can transition from rapid growth to sustainable profitability. Questions about future gross margin expansion have been a sticking point.
The timeline for Neutron’s first flight remains uncertain. That uncertainty is weighing on the stock despite the strong launch cadence from the Electron program.
Valuation Reality Check
Rocket Lab’s market cap stands at $30.4 billion, a valuation that some analysts consider stretched given the company’s current financials. The stock carries a price-to-earnings ratio of -158.60, reflecting the company’s ongoing losses.
Shares have had quite a run this year, trading in a 52-week range from $14.71 to $73.97. The recent selloff followed a strong advance that pushed the stock near its yearly highs.
The company employs 2,100 people and operates from its headquarters in Long Beach, California. CEO Peter Beck has led the company through its transformation from a small launch provider to a major player in the space industry.
Rocket Lab has another launch from its U.S. facility planned later this month, continuing the company’s push to maintain its record launch pace.
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