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Planet Labs sales growth figures continued accelerating in the third quarter, with revenue rising 33% compared to last year.
The company landed numerous new and expanded deals during the quarter as well.
Now collaborating with Nvidia and Alphabet on different ideas, Planet Labs' future has never looked brighter.
Shares of Earth observation leader Planet Labs (NYSE: PL) rocketed 38% higher this week as of 3 p.m. ET on Thursday, according to data provided by S&P Global Market Intelligence.
The data and insights provider delivered accelerating sales growth of 33% in its third-quarter earnings report on Wednesday while delivering a third-straight quarter of positive free cash flow.
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Thanks to the company's faster growth, continued FCF generation, an array of new contracts, and a backlog that more than tripled from last year, the stock soared higher this week.
Despite the government shutdown weighing on Planet Labs' civil government business unit -- which only grew sales by 1% -- the company's defense and intelligence unit saw revenue spike by 70%.
During Q3, Planet Labs secured a:
This is a boatload of incoming deals, especially compared to the total revenue of $81.3 million during Q3.
Image source: Getty Images.
Planet Labs also successfully launched more of its next-generation satellites into space, with two Pelicans and 36 SuperDoves joining orbit. Now with five in orbit, these Pelican satellites are particularly exciting in my opinion, as they are equipped with Nvidia's Jetson AI platform.
Since Planet Labs can utilize this AI to scan for the most valuable insights and only send what is immediately relevant, the company can save immense amounts of time and money.
But its next-gen ambitions don't end there.
Planet Labs also announced a partnership with Alphabet's Google to deploy prototype satellites in 2027, equipped with the latter's Tensor Processing Units. While the feasibility of data centers in space is a hotly debated topic, it nevertheless highlights Planet Labs' growing importance after being selected by Google as a partner.
Planet Labs appears to be a promising growth stock, but at 20 times sales, interested investors should consider buying in small batches over time.
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Josh Kohn-Lindquist has positions in Alphabet and Nvidia. The Motley Fool has positions in and recommends Alphabet and Nvidia. The Motley Fool has a disclosure policy.
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