Good day, and welcome to the Rocket Lab Corporation Q2 earnings call. Today, all participants will be in a listen-only mode. Should you need assistance during today's call, please signal for a conference specialist by pressing the star key, followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one, on your telephone keypad. To withdraw your question, please press star, then two. Please note that today's event is being recorded. At this time, I would like to turn the conference over to Murielle Baker, Senior Communications Manager. Please go ahead.

Hello and welcome to today's conference call to discuss Rocket Lab's second quarter 2025 financial results. Before we begin the call, I'd like to remind you that our remarks may contain forward-looking statements that relate to the future performance of the company. and these statements are intended to qualify for the safe harbour protection from liability established by the Private Securities Litigation Reform Act. Any such statements are not guarantees of future performance and factors that could influence our results are highlighted in today's press release and others are contained in our filings with the Security and Exchange Commission. Such statements are based upon information available to the company as of the date hereof and are subject to change for future developments, except as required by law, the company does not undertake any obligation to update these statements. Our remarks and press release today also contain non-GAAP financial measures within the meaning of Regulation G enacted by the SEC. Included in such release and our supplemental materials are reconciliations of these historical non-GAAP financial measures to the comparable financial measures calculated in accordance with GAAP. This call is also being webcast with a supporting presentation, and a replay and copy of the presentation will be available on our website. Our speakers today are Rocket Lab founder and Chief Executive Officer Sir Peter Beck, as well as Chief Financial Officer Adam Spice. They will be discussing key business highlights, including updates on our launch and space systems programs, and we will discuss financial highlights and outlook before we finish by taking questions. So with that, let me turn the call over to Sir Peter.

Thanks, Muriel, and thanks for everybody joining us today. Look, we've delivered impressive financial results this quarter with another record revenue of $144.5 million, above the high end of our prior guidance and up 36% compared to last year. A gap gross margin expansion exceeded expectations this quarter too, and the consecutive growth of the company is really exciting to drive. No surprises here that Electron continues to be the leader of the small launch industry. We had five launches across the quarter, two of them back-to-back from Launch Complex 1 in two days. Demand for its services is also increasing from different countries, with multiple international space agencies signed up for electron launches this year and next. We made rapid progress towards the pad with Neutron this quarter. Launch Complex 3 is ready for its grand opening, and we've got the first rocket parts on their way to Virginia. More to share across the program in the up-and-coming slides here. And finally in space systems our prime contractor status is expanding with our imminent acquisition of GEOST. Being able to quickly build and deploy entire satellite systems is the cornerstone of the future US defense strategy and we're in a prime position to play within those large opportunities within launch spacecraft and now payloads added to our end-to-end capabilities. So let's get into those details now. We're very close to finalizing our acquisition of GEOST maker of missile tracking satellites for national security missions. Having cleared through the antitrust review, we're on track for signatures on paper here pretty shortly. I'll let Adam take you through the financial details later, but if there's one thing to take away from this deal, it's adding payloads on top of launch and spacecraft really cements our status as a one-stop shop for national security. We're already a trusted disruptor in the launch and prime contractor for Constellation Builds, this acquisition adds to our competitive advantage. It will bring an extensive inventory of space-based missile warning sensors and manufacturing facilities in Arizona and Northern Virginia that secure the domestic supply chain of this critical technology for next-generation missile defense initiatives like the Golden Dome and the STA constellations. The $175 billion Golden Dome program could prove to be one of DOD's largest procurements to date and we're in a great position to capitalize on opportunities here. A strategic investment and the way that we've scaled the company to uniquely meet its needs positions us strongly to win either as a prime contractor or even as a sub or even as a component supplier. A pursuit of the Golden Dome extends just beyond payloads. Across its entire ecosystem we have the technology and capability ready to serve. We operate the world's most reliable and response a small launch vehicle electron operating at the fastest cadence of any small launch vehicle in history having just completed its 69th launch with a hypersonic testing variant haste we are revolutionizing the way missile defense technology is tested in a hypersonic environment a new reusable rocket neutron perfectly answers the call for a diversified launch of the national security and can deploy entire constellations of spacecraft at once to build out the dome's proliferated architecture we've already won more than half a billion dollar contract with the SDA to build and operate a significant piece of their PWSA network so there's a golden opportunity to build upon that here with our existing capability. And look the list goes on but I won't belabor the point. Our advantage is our commercial speed and proven execution. The way programs like this have been built in the past dominated by the large defense primes just won't work the same time this time around to meet the administration's urgent timeline. It needs agility and innovation, vertical integration and on-time delivery and execution. That's what we've delivered time and time again across our programs to date and what we stand ready to deliver for the Golden Dome. There's no better mission on the books that demonstrates the full depth of our capabilities than the Victus Hayes mission for the Space Force. Across its tactically responsive space program we're the only provider delivering a complete end-to-end launch plus spacecraft solution. We're bringing the full stack of offerings across the satellite design, component manufacturing, integration and testing, flight software, ground, mission and launch licensing and the launch itself and on orbit operations. We own the entire mission lifecycle and its capability for national security that very very few others can provide. It's also a great demonstration of how commercial capability like ours can be leveraged to bring the concept of responsive space into operational reality. Exactly what the US administration is seeking with Golden Dome. This mission has a 24 hour call-up requirement which quite frankly is business as usual for Rocket Lab these days and we recently cleared the program milestone for Victus Haze that moves us into the final integration and testing phase of our spacecraft for the mission and launch of Electron Electron later is on track later this year. Another program with a major milestone tick is a transport layer constellation build for the SDA. The program has signed off our satellite design and approach for manufacturing which means we can now move into full scale production of these 18 spacecraft and recognize further revenue from this $515 million program. As this constellation gets underway, we're also preparing for a much larger opportunity within the SDA and its next tranche of satellite contracts. This is where our strategy of bringing key satellite technologies in-house makes us an attractive commercial partner. Our incoming sensor payloads, for example, are also in play for an SDA award and through other bidders. We can control the cost and reduce the schedule risk through our vertical integration in a way that others can't, and we hold the keys to that technology and components that are foundational to these contracts. And finally for space systems another strategic area of focus for this past quarter has been in supporting the administration's plans for Mars exploration. It was great to see a $700 million provided for a Mars telecommunications orbiter in a Senate's recent budget. The path to Mars for human spaceflight must begin with the ability to communicate there and this is something that we've always strongly pushed for. In fact we were the only company that proposed an independently launched Mars telecom orbiter as part of the end-to-end Mars sample return mission. So our ambition is clearly in line with the administration's vision for Mars. Much of our technology is already across major Mars missions like NASA InSight lander, the Ingenuity helicopter, the cruise stage that brought perseverance to Mars and of course our escapade spacecraft that are ready for launch here soon. We have got the Experience in delivering mission success for Mars exploration and a vertically integrated approach reduces complexity, controls cost, and provides schedule certainty, all under a firm fixed price. Now on to Electron. Once again, another busy quarter for Electron as demand and launch cadence continues to soar. The beauty of Electron is being able to choose when and where you want to fly. Sometimes for us that can mean flying in very close succession, like the four launches in four weeks that we saw in June, and two of those flew just days apart, a record turnaround for us at Launch Complex 1. We've since racked up launch number 69 and number 70 is scheduled for liftoff next week, keeping us on track for 20 or more launches by this year's end. These missions are a great showcase of how quickly we can turn around launches as they manifest demands, with the infrastructure, production and capability to place and support a launch a week as the demand for small dedicated launch continues to expand. Beyond Electron's proven heritage, as America's most frequently launched small rocket, international space agencies are coming to rely on it for access to orbit as well. We signed our first direct launch contract with the European Space Agency this quarter to launch a pair of satellites for the continent's future navigation constellation before the end of this year. The mission urgency stems from ESA's need to meet spectrum requirements by early 26. But with few domestic rides to space available for them, Electron is stepping up to the task of responsive launch. It's a similar situation faced by another sovereign space agency that came calling for Electron 2. I can't quite reveal the full details of those missions yet but it's fuel on the fire to Electron's international expansion and leadership in the small lift market globally. Now to cap off the list of space agency launch contracts, we secured another NASA mission on Electron for launch early 2026. Time and time again we've proven Electron to be the premier small launcher for NASA science missions and we're looking forward to delivering the same precise orbital deployments that they've come to expect now on to our neutron update for the quarter let's start with a top-down view of where things stand today we're building more than just our first rocket we're laying the foundation for long-term sustainable program we know that from experience that building the first one is hard but building the system that gets you to launch number 10 and 20 and beyond is much harder. Most of the capital of any rocket program goes into building out the infrastructure and we believe we've got all the critical elements in place now. Our launch and test sites are substantially complete, recovery infrastructure is on track, the Archimedes engine manufacturing line is now capable of knocking out an engine every 11 days and we believe that we've scaled our operations to be ready to support to move into multiple flights a year after the first launch gets off the ground. On the launch vehicle side the teams are working literally day and night to get Neutron to the pad. We're in a good spot with lots of core elements like the hungry hippo fairing, major structures, second stage, engine qualification etc. It's a green tick for stage 2 flight hardware and its qualification program. The brains of the rocket like the flight computer and GNC are ready for flight and so lots of green across the vehicle as you'd expect. Now there's been lots of action on the regulatory approvals front as well and we've been granted our FCC license for Neutron's first launch and the FAA has accepted our launch license application that puts us on track for a launch license to fly from launch complex 3 by the end of the year. We've also had the critical agreements in place to transport flight hardware to the launch site on Wallops Island. You've likely seen a bit of activity on that front around expanding our operations and dredging in the channel but these are improvements these improvements are related to increasing operational flexibility as launch cadence ramps up it's not a gate to Neutron's debut importantly the schedule is not sequential everything is happening in parallel and a lot of the progress markers that are underway or still pending are probably going to stay that way up until just before we launch there are still some risks to retire like propulsion and full integration of stage 1 testing which we're taking our time on to make sure we're successful and when the rocket is on the launch pad but over the next few slides I'll take you through the latest engineering updates and lay out the current expectations for the next few months ahead. First up an exciting moment on the path to launch. Neutron's flight hardware is on its way to the launch site. Over the past couple of months we've put the second stage through many many tests to validate its readiness for launch. Having completed its critical testing phase it's headed to the launch complex 3 for final integration in preparation for stage testing at Wallops Island. The large structures that make up the first stage like propellant tanks and thrust structures are expected to be on the test stands before they're shipped out to the launch site shortly. Once they've completed in a major structural test they'll progress into a final integration and stage testing. As we move out of R&D into production for the next rockets in our fleet, our factories are all humming. We've automated the production of the largest composite rocket structures in history with our 90 tonne AFP machine that we installed there last year. We're pulling flight parts off the machine now for the stage 1 barrels and propellant domes and allows us to scale efficiently. And we've made long lead commitments for manufacturing equipment that puts us in good place to build three vehicles next year. For Archimedes engine testing is accelerating and this is the most crucial and time-consuming aspect of any rocket development program and always the longest pole in the tent. We're running the engine to full mission duration and the operational test cadence is is hitting up to three or four hot fires a day now, seven days a week as we work diligently through all the engine qualification program. In between hot fires the team is making improvements and iterating on the design quickly and then getting right back into the next engine test firing on the stand. We expect these tweaks to all the way up to Neutron's debut launch and and beyond. For those who are interested take a look at the latest mission duration hot fire video we just shared. Moving on to launch complex 3 I'm pleased to say that we have an official date for the site opening later this month. The team in Virginia is well and truly into launch pad activation while we close out the final construction activities. The water deluge system was activated last quarter and now the team is meticulously making their way through system by system to prepare for static fire operations on the launch mount once a flight hardware arrives. Launch complex 3 is set to be a hugely important national asset. There's a spaceport bottleneck at the other federal sites right now and that shows how important launch site diversity really is. National security must take priority and with Neutron onboarded to the NSSL program earlier this year a rocket will be the first to fly for NSSL out of Virginia when we pick up missions under that contract. We'll be cutting the ribbon for Launch Complex 3 on August the 28th. We're also opening up a limited number of spaces for retail shareholders to join us on Wallops Island so I encourage anybody who is interested to check out the details on our website. All in all we continue to push extremely hard for an end of year launch. We're continuing to run a green light schedule with Neutron which means every single thing needs to go to plan for the schedule to hold but also want to stress that we're not going to rush and take stupid risks to get you know launch neutron before it's ready in the context of the lifecycle of the vehicle in the program a couple of months here or there is completely irrelevant what's really important is performance reliability scalability right from the get-go and there'll be no cutting corners here to just rush to the pad for an arbitrary deadline I think everybody has heard me say it before in fact I'm a little bit infamous for it now I'm not built to build shit so with that I'll hand it off to Adam and you can run through the financial highlights for the quarter. Great. Thanks, Pete.

Second quarter 2025 revenue was a record $144.5 million, which was above the high end of our prior guidance range and reflects significant year-over-year growth of 36%, driven by strong contribution from both business segments. Second quarter revenue increased 17.9% sequentially. Our space system segment delivered $97.9 million in the quarter, reflecting a sequential increase of 12.5 percent, driven by increased contribution from each of our satellite components businesses. Our launch services segment delivered revenue of $36.6 million, reflecting an increase of 31.1 percent quarter-on-quarter. Now, turning to gross margin. Gap gross margin for the second quarter was 32.1 percent, above our prior guidance range of 30 to 32 percent non-gap gross margin for the second quarter was 36.9 percent which was also above our guidance range of 34 to 36 percent the sequential increase in gross margins is primarily due to an increase in electron asp paired with favorable mix within our space systems business driven by increased contribution from our higher margin component sales Relatedly, we ended Q2 with production-related headcount of 1,150, up 62 from the prior quarter. Turning to backlog, we ended Q2 2025 with approximately $1 billion in total backlog, with launch backlog representing approximately 41% of this and space systems 59%. In the quarter, launch backlog continued to take increasing share with promising underlying trends as we converted a very strong pipeline of neutron, electron, and haste opportunities. Space systems bookings remain lumpy given the timing of increasingly larger needle-moving customer and program opportunities, but remains at a healthy level despite a step up in revenue run rate for the past few quarters. Upon the anticipated near-term closing of the GEOS acquisition, and given an increased line of sight to the minoric acquisition closing, the composition of backlog will likely skew a bit back in favor of space systems and further underpin incremental future growth. We continue to cultivate a healthy pipeline, multi-launch deals and large satellite manufacturing contracts that, as mentioned earlier, can create lumpiness in backlog growth given the size and complexity of these opportunities. We expect approximately 58% of current backlog to be recognized as revenues within 12 months, and we continue to get relatively quick turns business that drive top-line growth beyond the current 12-month backlog conversion. Turning to operating expenses, GAAP operating expenses for the second quarter of 2025 were $106 million, above our guidance range of $96 to $98 million. Non-GAAP operating expenses for the first quarter were $86.9 million, which was also above our guidance range of $82 to $84 million. The sequential increases in both GAAP and non-GAAP operating expenses were primarily driven by continued growth in prototype and headcount-related spending to support our Neutron development program. Specifically, investment has increased to support propulsion as we continue to qualify Archimedes, as well as production of mechanical and composite structures ahead of Neutron's anticipated inaugural flight later this year. In R&D specifically, GAAP expenses increased $11 million quarter-on-quarter due to ramping up Archimedes' production, paired with increased expenses related to mechanical systems and composites, as just mentioned. non-GAAP R&D expenses were up $10.2 million quarter-on-quarter, driven similarly to the GAAP expenses. Q2 ending R&D headcount was 935, representing an increase of 12 for the prior quarter. In SG&A, GAAP expenses increased $600,000 quarter-on-quarter due to an increase in non-recurring transaction costs as we continue to advance a robust pipeline of M&A opportunities, partially offset by a step-down in stock-based compensation in the quarter. Non-GAAP SG&A expenses decreased by $200,000, due primarily to a decrease in audit fees, partially offset by increased legal expenses. We are encouraged by our ability to constrain SG&A spending as we look to scale the business more efficiently at this point. Q2 ending SG&A headcount was 343, representing an increase of 11 from the prior quarter. In summary, total second quarter headcount was 2,428, up 85 heads from the prior quarter. Turning to cash, purchases of property, equipment, and capitalized software licenses were $32 million in the second quarter of 2025, an increase of $3.3 million from the $28.7 million in the first quarter as we finalized LC3 construction activities, continue to invest in the engine test facility at Stennis, Mississippi, and make initial investments into the fit-out of the return on investment charge. As we continue to invest in neutron development, testing, and scaling production, we expect to maintain elevated capital expenditures leading up to neutron's first flight. Gap operating cash flow was a negative $23.2 million in the second quarter of 2025, compared to a negative $54.2 million in the first quarter. The sequential decline in negative GAAP operating cash flow of $31 million was driven primarily by increased cash receipts from our SDA satellite program. Similar to the CapEx dynamics mentioned earlier, cash consumption will continue to be elevated due to neutron development, longer-lead procurement for SDA, investment in subsequent neutron tail production, and related infrastructure to scale the business beyond our initial test flight. Overall, non-GAAP free cash flow defined as GAAP operating free cash flow, sorry, defined as GAAP operating cash flow, less purchases of property, equipment, and capitalized software in the second quarter of 2025 was a use of $55.3 million compared to a use of $82.9 million in the first quarter. The ending balance of cash, cash equivalents, restricted cash, and marketable securities was $754 million as of the end of the second quarter of 2025. The sequential increase in liquidity is due to the at-the-market equity offering that we announced earlier in the year, which generated $320.8 million in the second quarter, which in part is intended to fund acquisitions, such as the announced Minoric Acquisition, the Geost acquisition, and other targets in a robust M&A pipeline, along with general corporate expenditures and working capital. We exited Q2 in a strong position to execute on our organic expansion opportunities, as well as inorganic options to further vertically integrate our supply chain and grow our strategic capabilities and expand our addressable market, consistent with what we have done successfully in the past. Adjusted EBITDA loss was $27.6 million in the second quarter of 2025, better than our guidance range of a $28 to $30 million loss. The sequential decrease of $2.4 million of adjusted EBITDA loss was driven by an increase in revenue, paired with increased gross margin, partially offset by increased R&D expenses related to Neutron. With that, let's turn to our guidance for the third quarter of 2025. We expect revenue in the third quarter to range between $145 and $155 million. We expect a further uptick in both GAAP and non-GAAP gross margins in the third quarter, with GAAP gross margin to range between 35 to 37 percent and non-GAAP gross margin to range between 39 to 41 percent. These forecasted GAAP and non-GAAP gross margins reflect improvement in launch ASP and overhead absorption. We expect third quarter GAAP operating expenses to range between 104 and 109 million dollars and non-GAAP operating expenses to range between 86 million and $91 million. These modest quarter-on-quarter increases at the midpoint of our guidance are to be driven primarily by continued Neutron development, spending across staff costs, prototyping, and materials, though the spend is beginning to shift from R&D to Flight 2 inventory. I'm encouraged, given the impressive progress made towards Neutron's first flight, that we're getting closer to moving beyond the past few years of elevated R&D spend and on the path to generating future meaningful operating leverage and positive cash flow. We expect third quarter GAAP and non-GAAP net interest expense to be $1.3 million. We expect third quarter adjusted EBITDA loss to range between $21 and $23 million, and basic weighted average common shares outstanding to be approximately 528 million shares, which includes convertible preferred shares of approximately $46 million. Lastly, consistent with last quarter, we believe negative non-GAAP free cash flow in the third quarter will remain at an elevated level, consistent with the prior couple of quarters, excluding any potential offsetting effects of financing under our existing equipment facility. And with that, we'll hand the call over to the operator for questions.

Thank you. We will now begin the question and answer session to ask a question. You may press star, then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If you withdraw your question, please press star, then 2. At this time, we will pause momentarily to assemble our roster. And today's first question comes from Michael Leshock with KeyBank Capital Markets. Please proceed.

Hey, good afternoon. Wanted to ask on Neutron and specifically the Archimedes engine. I appreciate all the commentary there and around the hot fire test. where does Archimedes stand today in terms of performance? Are there any other performance metrics that you could share from what you're seeing in those tests and, you know, is there a way to frame it how close you are relative to what is required for performance to power a neutron flight?

Yeah, hey, Michael. Yep, so from a performance perspective, we're very happy. One of the unique things about a reusable launch vehicle is you have a tremendous number of different environments that the engine has to start and operate in. So, you know, normally you have, you know, an ascent profile where there's a couple of throttle points, and especially on a stage one, and it's a fairly simple thing. But, of course, we have a re-entry burn and a landing burn. So, you know, you have to start the engine at different propellant temperatures, different head pressures and all these kinds of things so it creates a much much enlarged run box or set of set of conditions that you have to be able to operate the engine and it's much more challenging to do but from a from a like a basic performance you know of the engine where we're very happy where it is and yeah it's like I say it's just a much more complicated qualification program to get through because you're qualifying ascent and descent at the same time great and then And shifting to a longer-term question, you've talked about a satellite constellation potentially

being a long-term opportunity for the company. How close are you to begin working on a constellation of your own? We saw the release of Flatellite earlier this year and the focus of it designed to scale.

Is a Rocket Lab constellation something that is being developed or talked about today, or is it more likely a longer term opportunity maybe five or five or more years down the road thanks yeah sure so we've always as you point out we've always made our ambitions clear here and and you know we think that is that is the power of being an end-to-end space company is when you have the ability to to build whatever satellite you need and launch it at will it you know it's a very powerful position to be in however I'm also very aware of entrepreneurial drift where someone doesn't finish one thing before they start the next and while we've been methodically building all of the capabilities and vertically integrating all the satellite components and whatnot we need to be able to do exactly what we want to do until Neutron is finished and flying that's the key element of being able to deploy a disruptive you know infrastructure of satellites so you know I wouldn't expect any huge announcements from from us on on constellations until the big piece of the puzzle, which is neutron, starts to absorb less of our focus.

Great. I appreciate all the detail. Thank you, guys.

And our next question is from Eric Rasmussen with Stiefel. Please proceed.

Yeah, thanks for taking the questions, and great to hear all the progress. And I'm happy to hear the noise around the dredging. seems like there's not really an issue in the near term of getting to your schedule. Just wanted to ask about backlog, and I think a lot of this has continued upon the SBA right now. I know you've also talked about the Golden Dome, but it looks like Tranche 3. Maybe just if you could just update us on what you're thinking is around potential timing around the RFP process, you know, where Rockin Lab will compete? And I guess in the vein of sort of the backlog, at what point will you start to include Neutron into the backlog?

Hey, Eric, I'll answer some of those, and I'll let Adam answer some as well. But, you know, more generally in backlog, the kind of things that we're chasing now are really large programs. So, by nature, these programs are pretty lumpy. SDA is a great example. I think we've put ourselves in a very strong position. We're executing against our current SDA contract very strongly. And you've seen us acquire things like GEOS that put us in a very strong position to provide solutions that are not plagued by delays and things like that. and also our recent pending acquisitions of things like MNARIC, which are one of the key elements in the SDA program. So I believe the timing of the announcement is somewhere between September and October for the Tranche 3. It's always a little bit opaque as the SDA works through those awards, but that's sort of a similar timeframe. But at any one point, we're working very large proposals, both government and commercial. And just by their very nature, they take a little bit longer to solidify. But I'll let Adam, maybe, if you've got any comments on backlog.

Yeah, no, I think, Pete, I think you hit it right. I think, look, we've got diversity in the things that we're chasing. It's easy to focus on something like STA tranche 3 because it's kind of a big, shiny object that a lot of people are actually chasing. But we've got a lot of diversity in the things that we're going after. And to your question on Neutron's influence on backlog, we do have three missions of Neutron in the backlog today. Those were added over the last few quarters. And I would say that, you know, of course, we expect after a successful flight of Neutron that we that will start to gain a lot more momentum. Because as you can imagine, you know, launch customers are, you know, they're betting a lot when they choose a launch vehicle. It's a long term choice and there are limited choices out there today. So everyone's being very careful about what they do. So we do expect that demand to be kind of unleashed, if you will, once we have a successful test launch. I would say that the, you know, if you look across all of our businesses, again, we're starting to see the diversity benefits where if you look at the opportunities we're chasing across our subsystems business, across Electron, both commercial, government, haste variants, we're seeing strong demand across all of them. And so it's just a matter of kind of converging. And if you look at the trend of backlog over the last year, actually, launch has been the bright spot, right? We had a huge step up when we put the SDA Tronch 2 award into backlog. And then basically, you know, we've been working against that as we recognize some of that revenue. And then launch has continued to build in the backlog. And that's going to continue, we believe, to be the case once Neutron kind of gets past that next big milestone or achievement of initial launch.

Great. And maybe just sticking with launch and Electron, you already did 11. It sounds like you have the 12th one coming up pretty soon, your 70th launch. What would you say the mix between your traditional Electron launches and maybe Haste missions in the back half of the year, what does that look like?

Yeah, so if you look in our backlog right now, if you look at the mix, we're expecting about, I think it's three of the remaining launches this year will be Haste. missions. So, you know, as Pete talked about, we're on path to do at least 20, hopefully more than 20 launches this year, which will be nice growth off 2024. And so we haven't had any haste launches yet this year. So we're looking at roughly, you know, three launches and all of them in the back half of the year.

Great. Maybe just my final, it's on Neutron. And I'm just trying to sort of parse through some of the words that Peter had mentioned in terms of cadence. You know, I think previously we were expecting the first test launch, so you'd have more of a 1.35 launch cadence for the first few years. But given the strong demand signals ensured to launch, and then maybe just if I'm reading right, is it possible that that's something that you can accelerate? Or what does that look like? Are we still sort of targeting that 1.35? Thank you.

Yeah, Eric. I mean, I get ridden every day on that question. and the reality is it just takes time to roll in the learnings between flights. So, you know, we proved with Electron that that was the right kind of scale-up cadence, and if you look historically across rocket programs, it's even pretty aggressive. So, you know, we'll stick with that 135, and who knows, but at the moment, from where we are in the program, that feels like the right kind of place to target everything.

Thanks.

And the next question is from Andre Shepard with Credit Suisse. Please proceed.

Andre is here from Cancer Fitzgerald. I'm not sure what that was. Hey, Pete. And hey, Patrick. Congrats on the quarter and all the great success. I'll limit myself to two questions just to be respectful to all the other analysts, maybe one on space systems and one on launch systems. On the space systems, Adam, I'm wondering if you can maybe remind us kind of what does the revenue recognition look like for the SDA Trunch 2 award, both for this year and for next year? And I know you mentioned, obviously, you're exploring several opportunities, but just to come back to SDA Trunch 3, if I'm not mistaken, right, that could potentially be the largest contract in company history. And so how would you characterize maybe the likelihood of success there?

Yeah, I can comment on kind of the REV REC, you know, generally for the SDA program, Tronch 2 Transport Rail, that we have that we're executing against. So, you know, these programs typically, you know, the award was, I believe, in late 2023. And so you get, typically when the program kicks off, you're doing a lot of the kind of initial finalizing the design and so forth. So where you really experience the meat of the revenue recognition is when you're actually starting to take possession of to build materials, to build the satellites with. So, right now, as Pete mentioned, you know, that's where we're kind of getting in now to that sweet spot where we're going to full-scale production of those vehicles. So, we're going to see a ramp in spending, or sorry, a ramp in spending and a ramp in RevRec resultantly from that. So, you know, I think that, you know, you should expect that revenue will be pretty, I would say, evenly balanced between the second and the third year of the program with 2025 being the second year in reality and next year is kind of the third year and then it'll tail off so you have kind of tails on either end with most of the of the revenue recognition in 25 and 26 um i mean just if you want to just think broad strokes you know for contribution in 2025 it's it's probably if you want to think in the order of kind of 150 to 200 million is the right range to be in uh and And then, again, that should look somewhat similar in 2026, assuming that we continue to execute like we have. And then if you look at SDA tranche three tracking, should we be fortunate enough to win that program? As you said, it would be the biggest program by a significant margin that the company has earned to date. And it would have a similar profile. I mean, there's a chance that there could be some revenue recognized early in the program, even as early as some of it later this year. And then you'd have kind of the buildup, you know, where 2026 would look for that program would look probably like 2024-ish looked for SDA. And then you'll have that, again, probably 80% of the revenue being recognized within the middle two years of the four-year program. So that's probably the best guidance I can give to you right now on that.

Got it. That's super helpful. Thanks, Adam. And just maybe a quick follow-up, if I may, maybe one for Pete on the launch systems. You know, after getting closer and closer to Neutron, I'm curious if you're seeing perhaps, you know, an uptick from customer demand or prospective customer demand for future flights. Obviously, you have the, you know, the track record, the heritage on the Electron and Haste, you know, Neutron still coming up. But, you know, given the, what do you want to call it, the conflicts between the administration and SpaceX management team, just curious if you've seen perhaps, you know, an uptick in interest for Neutron, for future Neutron missions in any color there, since Neutron essentially will be the only viable alternative to the Falcon 9, right? So just curious on what you're seeing.

Yeah, thanks, Andre. Well, I mean, look, I think it's, you know, the market does need a competitor to the Falcon 9. I think that was very clear and that was presented to us both from our commercial customers and our government customers. So, you know, there's a lot of anticipation and pent up demand for that vehicle to come to market. And that continues to increase all the time, not just from, you know, sort of political events or geopolitical events, but also from just, you know, large programs being added, things like the Golden Dome. I mean, that is going to be one of the largest DOD programs in the country's history. And they're all spacecraft in space and they all need to get there. So, yep, we're seeing, you know, growing demand and also I think it's fair to say realization that, you know, sorting out from the real players, from the players that are less likely to be able to provide.

Excellent. Thank you so much both. Congrats again on the quarter. I'll pass it on.

The next question is from Ron Epstein with Bank of America.

Please proceed. yeah hey good afternoon guys um so so pete just maybe broadly when we think about the first launch of neutron for you i mean just to kind of level set what would a successful launch be yeah hey ron well you're not going to hear some some rubbish about just clearing the pad as a success that is that is not uh for us a successful launch of electron uh will be um a success you know successfully getting to orbit and making sure the vehicle is ready to scale. I think you saw us come out of the gate with Electron, you know, go into orbit and then straight away, you know, three missions after that successfully delivering customers to orbit. So that will be the definitions of success. The bit that we'll be a little bit more flexible on is obviously the re-entry and soft landing of the first vehicle. There's a lot to learn there. You know, we think we've got a good head start, but that's that's the bit that is always requires a bit of iteration so you know like I say we'll we'll declare success when we're in orbit if if we don't soft splash down on the first flight I think there's a little bit of tolerance there to to for learning but apart from that yeah gotcha gotcha thank you for that and then and then Adam maybe what what drove the strong electron ASP in the quarter and is that a reasonable way to think about electron pricing going forward well you know we've we've been well there's a few things to drive that but probably the most i would say dominant force would be the the mix of haste in in the uh in the in the in

the manifest so as we've talked about you know we you know the the haste missions require very unique um you know i'd say mission assurance and other things that vehicles are unique and so forth so that makes sense that the asp would be significantly higher but it's really driven primarily by that I'd say overall, if you look at commercial electrons, those have been trending up nicely as well. So we've benefited from the fact that we've got customers coming back and they're doing bulk buys of electrons and significantly higher ASPs than we've seen in the past. If you were to rewind the clock two or three years ago, we would get customers coming that wanted to buy bulk buys, but they were wanting a significant discount to do that. And so in order for us to build, you know, the manifest and be able to, you know, kind of continue to drive the market, you know, we did that. And I think now we're in a position where we really don't have to accept any significant discounts and we're getting bulk buys. And I think part of the strength as well is we're getting a lot of support, as Pete mentioned in his comments, from the international community. Sovereign, you know, countries are coming forward with strong demand. And I think that, you know, it's a testament to the fact that execution in this market is so, so, so difficult. A lot of people can talk about it. They can put spec sheets on webpages and whatever else, you know, and payload user guides. But at the end of the day, you know, we're the only one that has had 69, you know, launches of a small dedicated launcher. And I think right now we're benefiting from all of that hard work and execution. And so we really don't have the distraction of people kind of doing some false pricing in the market with pressure. I mean, now it's pretty clear that, you know, execution is key and you've got to pay for execution.

Gotcha, gotcha, gotcha. And then that's actually a nice segue into my last question. You know, when we think about, you know, the Monarch acquisition and Electron adding the European Space Agency, what do you see as, you know, potential, you know, is there a potential European national security opportunity for you guys in space?

Yeah, Ron, I think if you look outside the U.S., what is the next biggest market in space, and it's Europe, and you'd be a fool not to be in there. So, you know, Manarica is a kind of stepping point in. And as you've seen, obviously, as you point out, the European Space Agency contracts, you know, we'll continue to expand into Europe. And, you know, we have a lot of unique capabilities that only reside with us. So, you know, we'll look to apply those.

Got it. All right.

Thank you.

Our next question comes from Edison Yu with Deutsche Bank. Please proceed.

Hey, good afternoon. Thank you for taking our questions. I wanted to ask, I think probably for Pete, your latest thoughts on orbital transfer vehicles, space tugs. I know there was a bit of a craze several years back in Leo that kind of flamed out a bit. But now it seems there's a lot of offerings coming to market, maybe trying to go farther away, bigger. And so is that an area of interest to you? I know you have the kick stage, but would you try to kind of tackle that more directly or more broadly going forward?

Yeah, it's a good question. I've never really understood the business opportunity and the business case for those because, you know, you start off with a relatively cheap ride share and you end up with a really expensive delivery. So as you point out, they've had a couple of starts. So look, if it turns into being a real market, it's completely elementary for us to go after it. I mean, we operate a kick stage on the top of Electron, essentially. And all the components to be able to do it, we have. So if it turns out to be a real market and a real opportunity, You know, the time that it would take us to deliver a product to market would be extremely short. But at the moment, I just don't see it worth us investing in.

And then on Electron, I wanted to ask about the TAM in the context of, you know, I have this big slide, obviously, on Golden Dome, Hypersonics. Historically, I think the TAM, maybe 30 plus launches. Because do we think that the TAM now for Electron could be much, much bigger than that, like 50, 60 launches going forward or at some point in the future?

Well, you're talking to a conservative engineer by nature, Edison, so it's hard for me to get too bullish. But if you just look at some of the programs like the Golden Dome, the amount of testing that that's going to require and the amount of suborbital kind of hypersonic missile simulants that you're going to need to deploy to be able to validate that system, there's a pretty significant number there that would be required. So in haste alone, you know, I think we're expecting that to continue to grow. But, you know, year upon year, the TAM continues to grow. And the exciting thing is that Electron is helping to create and open up that TAM. You know, we see a lot of satellites these days that are made specifically to just fit on Electron, envelope its environment, and, you know, it's enabling a lot of stuff. So I think, you know, we continue to see the TAM expand. And I think, you know, I don't see any sign of that decreasing in the future.

Great. If I could just sneak one housekeeping one on Geos. Any color on how much revenue that could potentially bring in at free closes and what kind of growth profile or buy call that has going forward? Thanks.

Yeah, I'll take that one. Look, we can't really say too much about it. It's still a pending acquisition. You know, as Pete mentioned, we got through the antitrust review, which is great. And I think, you know, close should be imminent. But we'll hold back any comments on color on that business until we actually own it, if you don't mind.

The next question is from Jeff Van Rie with Craig Hallam. Please proceed.

Great. Thanks for taking the questions. I guess Peter on space systems when you kind of flesh it out in your mind what you envision space systems ultimately being what percent of the way to your vision are we in terms of the capabilities that that segment currently has?

Yeah Jeff, great question so the toolbox is looking pretty full actually so you know from purely like a nuts and bolts component level You know, the Manaric optical terminals are an important one. And, you know, the vast majority of stuff has kind of come into focus. We'll see us spend a lot more time now on payloads, and GEOS was the first kind of beginning to that. And that really shifts you from being able to provide, you know, just a satellite bus to be able to provide, you know, a complete thing. So, yeah, the nuts and bolts, I'd say, we're largely done. You know, there will still be little add-ons we'll want to do, but our focus will be on payloads and really rounding out the system.

Yep. Helpful. And Adam, on the margins as it relates to space systems, just correct me if I'm wrong, I think 40% was the target there. You've made some really good progress. Is 40 still the right number and any sense of a timeline or sense of scope that it might take to get to that 40%?

Yeah. You know, there's a pretty wide mix, I would say, you know, margin profiles within our space systems business, you know, if you think about the margins on putting together a full turnkey, you know, platform solution, they tend to be lower. You know, if you think about those margins kind of, if you want to think about a ranges in the 20s to 30s, but they have good scale with them because of the size of the contracts that are involved. And, you know, actually those are much better margins than most other people would expect to achieve. And that's because we were so vertically integrated. Now, Now, when you look at the subsystems, we also have a very wide range there. We have some products where the margins are in the 20s, but we have some where margins are well north of 60 points. So if you look at blended average for, I would say, the overall space systems between the weighting, and right now it's kind of split evenly between subsystems and platforms. And as we start to mix in applications, it'll get different in a good way. You should think about 40%. We're not that far actually from that target. So I think our target was probably set a little bit on the modest side. But if you think of 40 to 45 points kind of as the real target for margins, I think that's probably a pretty good place to be. And that can be pretty good, you know, as far as contribution to the bottom line, because there's not a lot of R&D that goes into those businesses, right? A lot of it's customer funded R&D.

So when you look at the contribution margin, it's very, very healthy. um so again i think that yeah we've been we set the bar we like to kind of set expectations low and kind of over deliver to those and i think that we're on the path to the same thing with our space systems business when it comes to margins yep um very helpful maybe last for me on um on peter you mentioned production and i missed a little bit of it but on neutron uh obviously you're spending a lot of time building you know scale manufacturing capabilities just where are you in terms of of of neutrons now in terms of how many are you initially building, and what is the manufacturing capacity that you're putting up to give us a glimpse in terms of how you're thinking in number of ships, you know, this year, next year, year after?

Yeah, sure, sure. So, you know, some areas are at a high production rate, like, you know, engines, we're pushing for 11, you know, one engine every 11 days. And it's kind of, because it's a reusable launch vehicle program, the whole production cycle is literally turned upside down. So we need the most number of vehicles in production at the start of the program rather than ramping and scaling as you go along. So, you know, as we talked about, there's multiple vehicles that we're building even now. And, you know, a stage one can be reused 10, 20 times. So, you know, you're not actually every year you're not building that many stage ones. So the most amount of stage ones we'll ever build is probably, you know, year two or three. Of course, the stage two is expendable, but, you know, that's been, you know, highly refined for a very, you know, very quick production and low cost rate. So, yeah, I mean, as I said before, you know, sort of three stage ones is next year is the right way to think about it. Three stage ones, got it.

Okay, thanks so much.

Our next question is from Andre Madrid with BTIG. Please proceed.

Hey, this is Ned Morgan on for Andre today. Thank you for taking the question. I was just wondering, I've seen a lot of partnerships lately in support of Golden Dome, and I was just wondering if you guys are looking at doing something similar as opposed to doing any M&A.

Yeah, it's a good question, Ned. The reality is that, you know, we're very, very vertically integrated. And, you know, there's still obviously pieces of technology that we partner with, as we've shown on the SDA program. But I guess there's probably slightly less of a need for us to, like I say, given our vertical integration and just the breadth of stuff that we've got. We don't need to partner with that many people to deliver a solution.

Okay, makes sense. Then maybe one more from me. Regarding Tranche 3, how different would the upside look if you guys are selected as a prime versus a sub through, for example, Geost?

How do you mean the upside, Ned? What do you mean by that?

You know, if you guys are selected as a prime, I would imagine, you know, revenue contribution would be, you know, significantly more than as a sub through GEOS prior bid. So I was just wondering how things would look if they were on that.

I can take that one. Yeah, I can take that, Pete. Basically, if you look at the value of the subsystem that Geos provides, you can think of that as being kind of somewhere around 30% of the total platform value is in the payload. So, obviously, it's a much bigger opportunity as the prime than it's just as the sub for a subsystem. um now there you know there is the opportunity where you could have a goalie lock situation where you you're selected as the prime but also geos was bidding with um you know with other primes as well for that opportunity so there's there's a range of outcomes there but yeah certainly we are our goal here is to select this prime got it thank you very much the next question will come from Christine Laiwag of Morgan Stanley.

Please go ahead.

Hey, good evening, everyone. Peter, you've been very clear about your disciplined approach to pricing regarding Neutron. And considering the tightness of supply of launch, I'm a little surprised that you still haven't built out a sizable backlog for the program. Can you provide more color on how advanced your discussions are with incremental customers for Neutron? What they're waiting for to commit to an order? and how to think about the competitive landscape, especially as you've got a competitor rocket coming into market that's fairly well capitalized too?

Yeah, hey, Christine. Well, I mean, you know, you can split this into both into commercial and government. I mean, we were onboarded onto the NSSL program, which obviously is an extremely large opportunity, 5.6 billion, if I remember. And then on the commercial side, You know, we've talked about this before where, you know, they want to see a rocket that works before they commit because a lot of people have been burnt signing on vehicles that are either delayed or even, in some cases, never turned up. And, you know, we've always talked about it as well is we want to make sure that when we sign one of these customers that consume a large amount of our manifest that they actually turn up on time and all the rest of it. So, you know, we maintain that discipline going through. You know, it does nobody any good to fill up a whole bunch of manifests with a bunch of launches or a bunch of payloads that don't turn up in time and you're kind of left-handed holding the bag. So the most important thing, I think, for everybody is, you know, we get to the pad and we start launching and then, you know, We'll make the decision who are the best customers and most reliable customers for us, and the customers will make the same decision back. And on competition, I think I'm not sure I quite view that the same way.

Thanks, Peter. And Adam, as a follow-up, you mentioned expectations for elevated cash consumption beyond new transfer splite as you scale up. How should we think about the capital intensity following this initial launch? And should we still expect 2026 to be a positive free cash flow year?

Yeah. Look, I think the cash consumption will continue after the first launch because, as Pete mentioned, we're building the subsequent tails. And so if you think about cost to build a booster, and I think we've kind of used this, we've communicated this term or this figure before, But you assume around $60 million for a booster and you're building several of them, you know, in series or in peril in some cases here. You know, you could consume additional capital from that. You know, the key thing for us is getting through that first test flight. We've gotten the point where we've gotten the infrastructure largely in place. We do have some incremental scaling investments that need to be made, such as this return on investment barge that we've talked about. So, yeah, I mean, I think the business could consume, continue to consume money through 2026. So I would say more realistically for, you know, I would say, you know, positive free cash flow 2026. You know, again, given how aggressively we're moving forward, given the demand signal that we're getting, I think that's probably not likely. I think it's much more likely to be in 2027. But, you know, it depends. We could come across opportunities that generate, you know, enough offsetting, you know, incoming cash flow that it kind of balances that out. But right now, I'd say you should think of Neutron as being continued to, even in a success scenario, in particular in a success scenario, continuing to consume cash as we kind of build out that capability and put all the other scaling infrastructure in place.

Great. Thanks for the color.

I think it's important, Christine, to differentiate, though, that I believe that the P&L will obviously look much, much better once we get through the initial kind of successful test launch of Neutron. So I think it's important to separate the kind of the free cash flow from the P&L optics, right? Because I think the P&L does get much, much, much friendlier, much sooner. And then I think like a lot of other growth businesses, you know, we're going to be continuing to invest to grow. but the P&L should start to look much more attractive. And I think that's – we're keeping our eye on both, obviously.

Great. And as a follow-up to that, I mean, look, it's a good problem to have if you have a product that works and if you can scale up very quickly. Those are all good problems to have as a growth company. But when we think about the capital size that you might need, if you can build, like, in a bull case scenario, how much capital could you potentially consume with free cash flow in 2026? And when you think about the cash balance today, is that enough? Or would you need to raise capital to meet the demand? Should you be really successful and have that full-case scenario play out?

Yeah, look, I think we have sufficient capital to scale Neutron. So really, if you look at where – when we're raising additional capital, it's really not for Neutron. It's really all about doing things like, you know, the Menarch and Geos and other things that we have in our funnel. Yes, we could put a lot of money to work to to kind of respond to the demand signal as it evolves for Neutron that could continue to demand cash. But I don't see it outstripping kind of even what we have today. So, again, I think that, you know, you're right. It's a good problem to have. I don't think that any any liquidity constraints would be driven by Neutron. I think it would really be driven by how aggressively we want to go after and enable inorganic TAM expanding type of opportunities.

Great. I'm tempted to ask one more, so I just might. So when you look at that opportunity, I mean, it seems like the capital markets are fairly open, your stocks at record high levels. How aggressive do you want to accelerate some of those growth TAM opportunities, and where are those verticals? Where are you most interested in? What does that look like?

Yeah, I'll let Pete comment, obviously, as well. But I would say, look, we continue to see opportunities to further vertically integrate our supply chain. So we've done that very successfully in the past. We'll continue to find those types of opportunities. I would say that when you look at, you know, the ultimate, you know, end-to-end vision obviously has applications elements to it, which is, you know, Pete talked about some of that earlier. but i would say right now it's probably too early to to show a lot of leg on kind of where we're going there because as pete said you know given the focus or and the risk of entrepreneurial drift we're very very very focused on getting neutron delivered uh establishing you know very key fundamental and foundational payload capabilities and then the rest is you have to be kind of to be kind of you know put into focus a little bit later but pete i'll kick it over to Yeah, no, you said it very well, Adam.

I mean, you know, Christine, we're not finished yet, that's for sure, on M&A opportunities.

Great, thank you.

The next question is from Ryan Kuntz with Needham & Company. Please proceed.

Great, thanks. And most of my questions have been answered, but I'll touch on space systems a bit.

Nice progress on gross margins, obviously. I know you had acquired the solar business and some backlog there that was lower margin. How do you think about that business going forward and have the margins in that business now kind of normalized with new contracts and such that make you comfortable with the trajectory and continuing to see some uplift on space systems? Well, I can take part of the tactics on that one real quickly. So if you actually look at the progress on gross margin for the Solero business, you know, first and foremost, it's been very, very strong. When we acquired that business, we were looking at, you know, high single-digit gross margins. and you know in the first half of 2025 we delivered margins that were above the long-term target that we'd set for that business we'd set a target of 30 percent um that that business is is subject to the margin volatility is subject to kind of when some of the again that early contract which still hasn't completely kind of flowed its way through the books yet that there's still some to be delivered on that and so it's the timing of when that kind of comes in and out of deliveries. But I would say, look, if you just kind of look at where we'll be for the year, we're going to be pretty much spot on our long-term target of 30%. And I think longer term, there's upside to that. And I think more importantly, that deal has really, or that acquisition has really kind of fulfilled its strategic import of, you know, kind of really taking control of a very critical and tricky component in the supply chain for being a long-term kind of system provider and owner um so i think on on that front hopefully that gives you some color and then you know i think maybe pete you can speak to maybe the types of opportunities that we see in that business going forward and kind of where you expect margins to land for those yeah no thanks thanks adam yeah so so um you know we continue to to expand capability in that business um and obviously you you would have seen that we were successful with some chips money which has enabled us to completely modernise

or will enable us to completely modernise the reactor fleet in there and that drives in itself efficiencies. But if you look at programmes like the Golden Dome, there is an unprecedented amount of spacecraft and power that's needed to fulfil that and there's three space-grade suppliers in the world and we're currently one of the largest, if not the largest. So I see a lot of exciting opportunities for that business going forward. I mean, we are one of the preeminent providers for national security solar. So that's a pretty exciting future.

That's great. Thanks so much, Pete.

Our next question is from Suji De Silva with Roth Capital. Please proceed.

Hi, Pete. Hi, Adam. Adam, can you just remind us or tell us how the neutron cost of flow, maybe from OPEX to COGS, as the first launch goes and whether that might be material to the gross margin so we could anticipate that as these first few launches go off?

Yeah, that's going to be a really challenging thing to model for you guys. I think that, and that's a function of the fact that the first, you know, the test flight, of course, all of that's flying through R&D, right? And now we're actually starting to, for, you know, for the subsequent tails, that's not going to flow through cost goods sold with revenue cover associated with it. So the P&L is going to fluctuate quite a bit, you know, to the positive, as I mentioned to an earlier question. Now, when you start talking about the reusability and what that introduces to the volatility to margins, you can imagine that as we progress through, quote, unquote, hardening neutrons reusability, You know, how many reuses will, you know, for example, we'll be able to assume for, you know, for amortizing over, you know, kind of future missions, that's going to be a great influencer over gross margin. So you can imagine if the rocket is only kind of assumed initially to do X number of reuses, but it actually surpasses that or comes in underneath that, you're going to have a lot of volatility because you've got to have a situation where you have a fully amortized booster with all the revenue going forward on it. Or you could have made assumptions where you expect to fly a certain number of times and it under kind of achieves to that. And so you have a lot of, you know, incremental costs for future missions that weren't assumed. So it's going to be a tough one to manage. I think that, you know, the only thing that we can really point to, it's a bit different because it wasn't designed to be reusable from the outset, was Electron. And we've been able to bring down Electron costs dramatically, right? And that's without reusability. So, you know, we have a track record of successfully kind of scaling and bringing down costs. As we've talked about many, many times, another big influencer to gross margins is overhead absorption. So, you know, I suspect that Neutron will be a little bit different, but not fundamentally different from the fact that what's going to drive its gross margins is going to be cadence, right? So it's reusing cadence, but cadence is something that, again, we saw, we understand how that works with Electron, the huge benefits you get when you get the cadence up, and that's going to be a large driving factor for Neutron as well. Again, also coupled with our success in getting this vehicle to be reusable as quickly as possible, and for as long as possible.

Okay, great, Adam. I'll get my quantum computer out. And the other question I have is on payloads. Is Geo kind of your entree here, or do you have efforts in-house? for payloads as well as this inorganic effort, or will that segment be grown through our inorganic exclusively?

Yeah, Sajid. So a little bit of both. The reality is that, you know, often these payloads, especially when you're looking to bring solutions to bear in national security, have very, very long development cycles and a lot of heritage associated with them, which kind of naturally lends itself to acquisition more than organic creation. But there's certainly some elements of payloads internally that we're looking at that we will just go under our own steam. And then some things like Geostar, best in class, it would take decades to recreate that. So an acquisition is by far the most efficient way of opening that opportunity up.

Okay. Helpful colors. Thanks, Pete.

And the next question is from Anthony Valentini with Goldman Sachs. Please proceed.

Hey, guys. Thanks for the question. I'm just curious if, you know, I recognize you guys are, you know, laser focused on Neutron here. But is there any reason to think that, you know, you guys would introduce a new launch vehicle in the future that is either larger than Neutron or maybe even in between electron and neutron in terms of the capacity that it can take into orbit?

Yeah, good question, Anthony. So certainly not – we don't really believe there's really a market between the electron and neutron side. It's a very limited opportunity in that range. Now, if we need to go larger, I guess the good news is that, you know, the vehicle is very scalable um you know it's a seven meter uh diameter stage one tank so it's a very short dumpy vehicle so um you know the typically um that that's what governs your ability to increase the vehicle sizes your tank diameter otherwise you end up with big long skinny pencils and that that becomes challenging so um you know we we have no intentions at this point in time we think we've got the the market accurately sized and we've proven historically that we're not bad at making those kind of calls. But, you know, for whatever reason, the market drastically moved to a larger scale. You know, we have a vehicle architecture that is very easy to scale.

Great, thank you.

And at this time, we are showing no further questioners in the queue, and this does conclude our question and answer session.

I would now like to turn the conference back over to Peter Beck for any closing remarks. yeah thanks very much operator so before we close out today should be some slide here of our upcoming events and conferences that the team will be attending I look forward to sharing more exciting news and updates with you there and otherwise thanks for joining us that wraps up today's call and we look forward to speaking with you all again about the exciting progress we make here at rocket lab thanks very much thank you for attending today's presentation you You may now disconnect your lines and have a pleasant day.