Will Rocket Lab’s Red-Hot Rally Spill Into 2026? Space X-Sized Ambitions And Better Margins Are Keeping Investors Bullish

• On Friday, U.S. President Donald Trump also signed an executive order calling for Americans’ return to the Moon by 2028, and the establishment of initial elements of a permanent lunar outpost by 2030, boosting the space sector stocks.
• Over the last two quarters, Rocket Lab has seen its gross margins exceed 30%, driven by several Electron launches this year, which have achieved a 100% success rate.
• Rocket Lab said it expects fourth-quarter adjusted gross margins to be between 43% and 45%.

If one looks through Rocket Lab’s financials, one of the most striking factors is that the company has tried to sustain its gross margins even while working on several Electron launches, including working through the delay of its most anticipated Neutron rocket launch.

Most of the time, rocket makers, even while reporting soaring revenue growth, have seen their bottom line squeezed as they pour money into research and development and building launches to stay competitive with other companies. For Rocket Lab, the biggest firm to beat will be Elon Musk’s SpaceX.

The Margin Story: Rocket Lab Vs SpaceX

Over the last two quarters, Rocket Lab has seen its gross margins exceed 30%, driven by several Electron launches, which have achieved a 100% success rate. The company has noted that it is the world’s most frequently launched small-lift orbital rocket.

Rocket Lab said it expects fourth-quarter adjusted gross margins to be between 43% and 45%.

In comparison, several media reports, citing internal documents, noted that SpaceX posted an operating loss in 2019 and, in 2023, finally had an operating profit of roughly $3 billion, likely with an operating margin in the low- to mid-30s percentage.

What Could Fuel Further Margin Growth?

Rocket Lab has seen interest in its design and manufacturing capabilities from the U.S. government. On Friday, Rocket Lab said that it has been awarded a contract by the U.S. Space Development Agency (SDA) to design and manufacture 18 satellites for the Tracking Layer Tranche 3 program under the Proliferated Warfighter Space Architecture. 

The company said that this was its largest single contract to date and underscores its growing reputation as a trusted prime in national security space. Rocket Lab said the award is a $816 million contract and will deliver satellites equipped with advanced missile-warning, tracking, and defense sensors to provide global, persistent detection and monitoring of emerging missile threats, including hypersonic systems.

On Friday, U.S. President Donald Trump also signed an executive order calling for Americans’ return to the Moon by 2028, and the establishment of initial elements of a permanent lunar outpost by 2030, boosting the space sector stocks.

Rocket Lab also launched its 21st Electron rocket of the year on Saturday, aiming to deploy the latest satellite to space for multi-launch customer Institute for Q-shu Pioneers of Space, a Japan-based Earth-imaging company. This was Rocket Lab’s 79th overall Electron mission and final scheduled launch for 2025.

The company said the next Electron launch is scheduled for the early first quarter of 2026. Rocket Lab’s stock has gained nearly 30% since the U.S. contract and the latest Electron launch, adding to the more than double increase in its stock value seen in 2025.

RKLB Slowly Turning Profitable?

In the third quarter, Rocket Lab posted a net loss of $18.3 million, narrower than the $52 million reported a year earlier. The company’s loss has steadily declined, and it is expected to become profitable once its Neutron rocket takes off. For the fourth quarter, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) are expected to be a loss of $23 million to $29 million.

In November, the company said it had postponed the launch of its Neutron rocket to 2026, versus the initial plan to launch Neutron towards the end of this year. Rocket Lab said that the cash consumption will remain elevated due to Neutron development, investments in subsequent Neutron tail production, and infrastructure expansion to scale the business beyond the initial test flight.

In comparison, according to the Wall Street Journal, SpaceX had net losses of about $968 million in 2021 and $559 million in 2022, followed by a small net profit of roughly $55 million in 2023.

What Is Retail Thinking?

Rocket Lab’s retail sentiment dipped to ‘bullish’ from the ‘extremely bullish’ territory a week ago, with message volumes at ‘extremely high’ levels, according to data from Stocktwits.

Rocket Lab has seen a nearly 65% increase in Stocktwits followers in the past year, while message volumes have rocketed 1600% in the last year, indicating intense retail trader interest.

Investor interest in space companies has also increased from chatter about SpaceX’s potential IPO set for 2026. Shares of Rocket Lab have gained 204% so far this year.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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