Firefly Aerospace shares fell sharply on Tuesday after the rocket developer reported a wider second-quarter loss and declining revenue in its first earnings release as a public company.
The stock dropped 10.64% to $44.25 ahead of the opening bell, putting it on track to erase Monday’s gains, when shares had rallied 9.6% following news of an additional NASA contract award.
First results since listing
Firefly’s results mark its first quarterly earnings announcement since going public last month, when shares debuted at $70.
The company posted an adjusted loss of $5.78 per share for the second quarter, compared with a $4.60 per-share loss in the same period a year earlier. Analysts surveyed by LSEG had expected a narrower loss of $5.29 per share.
The company’s net loss widened to $80.3 million, from $58.8 million a year earlier.
Revenue declined 36% year over year to $15.5 million, down from $21.1 million in the second quarter of 2024.
The financial results underscore the volatility of companies in the space sector, where development costs can fluctuate significantly from quarter to quarter. Firefly only recently transitioned into public markets, with its listing date on August 7.
As of Monday’s close, the stock was still up about 10% from its debut price despite recent swings.
Analysts note industry challenges
Cantor Fitzgerald analyst Colin Canfield said in a research note that variability in costs makes it difficult for space manufacturers to consistently meet quarterly earnings expectations.
“Space manufacturing and especially launch will always bring a high degree of lumpiness that makes meeting quarterly expectations difficult, although we are vigilant for how profitability drives investor sentiment,” he wrote.
Despite the near-term challenges, Canfield highlighted sustained demand for Firefly’s launch vehicles, particularly given accelerating defense spending.
He reiterated an Overweight rating on the stock with a price target of $65, implying about 24% upside from Monday’s close.
Investors have increasingly scrutinized profitability in the commercial space industry as more companies enter public markets.
While revenue streams from government contracts provide some stability, the high fixed costs of development and launch operations continue to weigh heavily on earnings.
Stock volatility reflects mixed sentiment
Tuesday’s premarket decline came after a sharp rally the previous day, when Firefly announced a $10 million contract addendum from NASA.
The announcement lifted shares nearly 10%.
The latest selloff, however, suggests that concerns about quarterly losses and declining revenue outweigh optimism over new agreements in the near term.
At $44.25 ahead of Tuesday’s opening, Firefly shares were on pace to erase the prior session’s gains, bringing the stock further below its initial $70 listing price.
While analysts such as Canfield maintain positive outlooks based on long-term demand, near-term performance is likely to remain volatile as the company works toward stabilizing its results.
With defense budgets increasing and government agencies such as NASA continuing to award contracts, Firefly is positioned within a growth market.
However, Tuesday’s earnings highlighted the balancing act investors face—between optimism about the long-term potential of commercial space ventures and the immediate challenges of profitability and execution.
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