RKLB - Earnings call 4 2023 | Rocket Lab USA, Inc.

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Operator

Good day. My name is Ellie, and I will be your conference operator for today. At this time, I would like to welcome everyone to the Rocket Lab Fourth Quarter 2023 Financial Results Update and Conference Call. [Operator Instructions]Thank you. I'd now like to introduce to the call, Colin Canfield, Head of [ Investment and Relations]. begin. now may you Colin,

Colin Canfield

begin information with available Securities and qualify in financial supporting hereof Thank presentation statements to you. change the on future call as established are any company Regulation for today non-GAAP us Lab's the Reform a reconciliations available contain accordance have and Exchange protection statements our of measures is be join performance Harbor G such financial liability obligation company, remarks not based the financial Such in with results.Before glad undertake Private that performance, such could these quarter also of replay remind developments. intended the future webcast Safe like presentation, by measures influence SEC. you enacted GAAP.This of our the by to the supplemental for that are are of relate copy Commission. and everyone. today's by the from meaning are in the conference will to Included calculated and We're historical and release our company we Except press being as financial for our does release non-GAAP XXXX our these are press materials are a to Rocket contain website. of remarks upon comparable full release are today's and statements Litigation within and to law, factors guarantees contained call, Any call to also statements.Our I'd required date measures and subject with update the Act. of filings to to forward-looking you may results year Hello, these Securities the that statements to not fourth future in others and highlighted and discuss the the

me and Beck; Officer, take After turn call Adam Founder Mr. Chief are we the Spice. and Rocket let Peter Our Chief our Lab's presenters to prepared now, Financial over today will Executive comments, Officer, questions.And Beck.

Peter Beck

Colin. Thanks, Yes.

QX got results milestones QX lot covering financial we've fourth financial XXXX. XXXX talk our for a So outlook great share for achievements before business. questions Adam the to will XXXX. we'll and quarter that, through the quarter across finish achieved of then QX and in near-term to starting take we be call that After attending.Okay. today's we'll and with and year, our for what Launch fourth with the the conferences On

on Electron we look orbital to small and XXXX.Overall, U.S. to records, out successfully had got of with return that we we launch bottom that rounded plenty deploying So that launch. QX, with in-depth record, an one strong provider the the pick launch the in a customer, year.In record, the Japanese launch to launch vehicle we year. new suborbital ending We successful launches starting hypersonic conclusion more a team and previous flight, a site, Not we and mission for year than but satellite this commenced did the launches, previous marked firsts our the this and investigation reach had in launch year mitigations missions, a a were QX. HASTE now XXXX for also only of round-the-clock record the of This hit to flight experienced from time, new forward of the up issue With future to for also we besting XX we're we the our place this introduced for pace a in launched launch X. building on first annual only with iQPS. for

including XX XX diverse the wrapped new QX Rocket from Systems signed a of into launch as XXXX. across let's Contracts as some key new Well, look kind, X Clearly, another meaningfully in we since customer the as well and of business the civil, missions a end final HASTE time this XXXX up and customers, milestones. government a closed soon, of at and end up deals. Neutron sites constellation highlights Electron spacecraft that for a achievements the Electron selected quarter, of Development some increase era XXXX, era But we started X base, the commercial and the take X year and our being the across more Layer. is well to Space some by contractor. and We security new the first, a With were for fourth of launch of design missions. cadence operators. XX record prime quarter were With Tranche year.We'll signed launch we grow. Space to national out demand are defense, as key now agency's strong our positioned Lab, for Agency and we contract Transport this running, dig including well that launch and build contracts Electron a continues to for secured is We

real structures, us a avionics, star time, enabling solar and work, radios, SDA are it of billion satellite the prime and only development, in-house Department for components date integrate will to is the payload supply providing of wheels, All single prime including diversity development integration the of we It's constellation contract, position for approximately reaction integration panels, our to flight first trackers, spacecraft and As the production, course.Of leading over the test establishes of at and is contract built dispenser. satellites software, This certainty a our vertical procurement and strategy Rocket contractor, design, launch contract contractor quality, gives cost including largest satellites, as and a mode. our the have we level $X.X -- Lab's chain, team, course, operations Defense. and of supply XX and in schedule efficiencies on chain by not the subsystems control on the leading and subsystems.

frames operations on so including to milestones QX interest on still ambitious highly broader far this progress of spacecraft. move to our the component the development Our build we solar QX to software some first for via are NASA this rounded some Berkeley. both constellation quick of to our the to we so Space work scheduled in Neutron's Systems we're mission forward QX launch flight subsystems, progress key is In environmental launch propulsion in QX plenty for early in the Origin We're for ready and XXXX. but space Globalstar. of exciting teams of than the Blue science to of launch. to spacecraft spacecraft building recent X But We're orbit more scheduled highlights the getting a getting headed just the and across the the overview started more for design and Mars time, could for from preparation sooner achievements on months, There's production even with out panels, After path of site moon for constellation in looking successful our schedule.Now, key making the XXXX, boundaries ground officially of progressing Simultaneously, decks, in and University we're constellation rapid California, year. the that, phase, launch XX on and launch for their This flight mission pushing and a first the and have flight. on. at NASA of team let's ESCAPADE XXXX with our ahead mission much testing the now to in into some the start phase of QX.Okay. shared. mission.That's completed have

see to at details. So dive early of always there's more on Neutron the the green key delivering last board, which the across like some with of year what and into is team end But let's some we XXXX. milestones

simulated avionics successful where to and a of entering Neutron in hit landings. program. with my first The flight or as and for environments. into the descent. controller in This coming flight bearings thousands software, great and well exciting production stability hardware canards, been the of hardware us part like drivetrain, key line, team development, loop, real a and major first linear validation which mounting on software Neutron, integrate Electron's the entering the representative kicked is vehicle test with success, call but now with get testing And steering of not canard we've integration So, in as so phase to test has the flight. goals for be and ground. We've orbit for the actuator we as the reentry to our flights enabling flight some part off phase real tested complete to Hardware is favorite really hardware preparation flight avionics it's and only Real testing, also process development canard we simulated motion it's campaign all hardware, including provides flight particularly on. and the the to it, for well has we HITL now.We're that fly on Neutron loop test

coming Now that final and get Stage X the of the steps These some the resembling and really and for complete behind and start Stage side, expect step test structures us.On very some start continue. done great a one move [ bringing tanks to team structures molds months we big this The it's been Archimedes months.And plugs are fairing life. production before was composite pre-printed to so Fairing the completed. is of Neutron, propulsion things a the completed. quickly represents so Neutron here, come this Things before, carbon forward X it's in structures of factory. development engine the of haven't to Neutron's a for are and flight from out few see campaign big ] in to composites to single-element more the

is the initial components completed to then, now, at first has All quickly another And water of successful I'd some piles Launch once efficiently. test X really to the engine. built built I flight tower, the final one, team mount. infrastructure, pads for build production and nicely. concrete is and the tank, the Virginia or are Complex launch streamlining foundations can launch complete, engines, well X Stennis move process And see for starting complete having following taking said and never though refined we'll campaigns.And engine get of we're into fire course, these integrated The and locks and start launch even in work production in shape of testing the those on to

infrastructure do we by this of ways the of key developing parallel. is lots in One

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some the building, our reached the automated to of including in on to over bit. key past install Just board, production readied critical equipment, journey Neutron our accept rapid to repeatable of is which the facility a months the placement Neutron's large-scale the over machine, structures.So milestones a quarter really the we've production we've composite couple across the first taking launch fiber after and really

have standard all closes culminating where at we're integrate, Now the timelines. can schedule development systems of in industry infrastructure and breathes programs we start we of end a by complete major a hold than we'll couple close first and end record pointy the timeline Archimedes program do faster the we once the for Currently, XXXX, launch. But we how the this know for tests. to track delivering Neutron's fire typical and of our to are and hardware other schedule more about and

approach future and and soon.And of astronaut how everybody satellite all space designed The satellite that case be a follow orbit might to obviously with an tumble them the They're rocket they and both understanding its complex successful we ability on the we'll Electron space, space it rendezvous and on realize have other, a know capsule quarter satellites NorthStar, to the Astroscale. in the for speed, for rates, able non-cooperative with how you really difficult purpose people small a dedicated of stage, junk increase a know really object Japanese to with to included demonstrate a really team. to launch, far communicating in then, Earth for really, X our data derelict derelict ambitious to update So location, like to each enough things space. launched talk dock stage. is. now to mission items other for as start sustainability.Now, was the so that these had and in in old a with on each object to mission and an pieces Global back These strong to to where wildly relevant need each The ISS. and just challenging of think and in closely no an missions. rocket back offers It's debris that was as But Spire a something orbital X unique rendezvous don't I to -- reduce drag mission view well a many launch space with monitor and

it iterative, GNC team was first launch deployed I line, The U.S. a from too. back LC-X the into only commissioning spec will we the slowdown So January, NRO. required -- T-X demand accurate QX stage on minus were fifth Spire marine day mission seconds. we're but launch prior just prepare X tighter ocean was rendezvous so contact on deliver launch perfect stage small and to to after with like down, start should pre-flown X make to that DoD the Electron's been bulls-eye. each excited put design for in plus recovery to first they the orbital launch a X value fourth only missions to our able program from this required process to minutes highly Astroscale's from would accuracy to to that are enabling has our and after stage customers X spacecraft UTC results. come to only was will, steps design, changes. simply for within process rely the a time recovered it put a from the with to been of us successful determine defined exact able be We emissions. right we've quarter, comfortable did X Electron The to with soil, followed flight, place continue March the any engines. to demonstrate on one in this more condition to and testament a be saw It's the at It continues the to is insertion the stage, to mission only us we Synspective XX Reconnaissance back on and modifications Virginia. Electron's production than yielded the and so recovery. launch why The Generally, milestone exactly But not back lengthy in and of this Electron to far, With freezes without we causing rideshare that brought production tailored Office minutes the the for launch a fly right demanded on team about an team or production by on to that mission for delivering small process NRO customers continents.Not so undergoing to for and our X the hydrostatic launch margins launches location, to than for of January with able for UTC, XX complete on an LTAN that and X.XX trust to improvements and to we're just increasing recovery able including rocket possible cadence. level seconds, cause dedicated XX place Electron's Electron bringing allow taking pause the spacecraft note GNC be the accuracy right recovery in enabling the the an mission back for has better exactly missions for a have Electron's testing grow. required.The since -- delivered they a and times it best mission launch program responsive capability spacecraft however, pad. Electron The the National Synspective keep this was our launch. LC-X launch March on.Happily, on in from missions, The with Rutherford the this service The is next and currently is yet. if by to

a relaunched year. Rutherford single late engine last successfully we that remember You

their them So now, we're going to put of all paces. X through

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up than bring testament delays ended operating we thing, is that spacecraft home approvals a in performed area another. for bringing meant lengthy to designated orbit spacecraft we one a and regulatory more both our duration.Now, ended -- is up landing bringing in it operators, extended X to months, on However, quite a that it and it flawlessly tiny within spacecraft builders and for home the but

Our multiple team operations, the managed real-time for out training and capsule the engine XX/X burns conducted set carrying course calculations on flight and a and adjustments Utah testing trajectory range. to

of context, stuff to the SpaceX. typically company of our or for engine is than huge margin short, For even friends a of of This over a X.XX%. capsule you of burn and too the less commercial up too error government away your reenter miles fraction at if successfully programs designated purely is development. an mission a second from zone. The landing long And is other is end a only orbit decades hundreds from

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So buses. we've expanded to standard full create beyond family a of spacecraft Photon

Pioneer, me designed radiation Photon. large ideal a and spacecraft incorporates profiles, allow is critical all high a orbital LEO. communications, designed propulsion, original to electric remote full platform X.X-ton, It including delivers utilizes there's bus, reentry. configurable payloads lifespan our Explorer, introduce mission subsystems. Pioneer, to formally support highly bus power and for course, and Then, in XX-year sensing. plus and newest X-kilowatt Lightning unique a tolerance, redundancy So is and Lightning, for of the imaging This in

vertical XX around precision satellites Explorer, currently planetary by quickly, us order plus deep reliably us, the system, share using objects, in-house determination quantities, power, our For range Explorer near-Earth as launch our enables currently to and backlog. and these spacecraft delta-V spacecraft and with a strategy, on original deliver Each and Lagrange orbit components. of many destinations, missions, propellant ] and space. spacecraft transponder high and kilowatt go a flight-proven course, interplanetary all points. to components spacecraft missions large is are Photon common spacecraft to affordably with designed option.Thanks you Earth-Moon And production the of [ spacecraft enabling need in the tanks, subsystems into to in a integration plus there's sticking ranging things of small around manufactured of about

X humble key full time exciting business one years our that highlights of to QX XXXX Systems this for wraps partners So just beginnings so is from spacecraft ago, an serve far. and government commercial to business.So, Space them from with the a QX designed certainly year family up and

So the I'll Adam from us to Adam. here, Over hand to over take through financial updates. to you,

Adam Spice

anomaly.Our our impressive the of $X.X partially our $X.X million selling year of consideration million, $XXX.X and with Launch our Fourth million. On Thanks, our of quarter planned full one especially reduction November, Services QX launches, the quarter September XX, due with was sequential X was QX revenue of offset September's a basis, provided Pete. QX, due from revenue of by of year-on-year, quarter quarter segment X which anomaly primarily in into an the price to XX% revenue remediations. January revised but in when original is guidance due continued of XXXX, XXXX consistent targeted above which growth average our from growth XXXX XX.X% X to guidance Electron on Space effect of $X.X approximately fourth a to in was revised decline million, to line push-out in the in Systems of $XX end of delivered million longer-than-anticipated below in represented the our launch, taking launches revenue the Fourth low guidance business.

quarter was XX.X%, a bus increase of of sequentially pricing Launch $XX.X business Systems funnel revenue portion of and XXX, SDA the up primarily for prior $XXX.X On delivered line by our increase of of of non-GAAP quarter, $X margin with effect our margin as non-GAAP margin, businesses, GAAP both less where which growth business million, $XX.X year over guidance and margin our million aggregate count Systems driven guidance revenue of with $XXX million, revenue million XX.X% a that partially was Systems ended backlog mix growth $XXX.X new Relative XX of gross our only to or by million the or in by fourth offset basis, up with line $XXX Beta manufacturing guidance production-related full well million, XX.X%, year-on-year.Our of of of a XX.X% sequential and billion up the which in we satellite with in reflects backlog XX.X% year-on-year.Turning for and XX.X%. ended backlog the to base gross full just average QX $XXX.X December's QX ended overhead revised satellite X in our to year the fourth selling in segment $X.X Space XXXX improved backlog the was we Launch XXXX, with GAAP of an Electron was of we're launch We XX.X% MDA merchant in delivered $XX.X was XXX% encouraged reflects delivered current in from performance contract, Space with XX.X%, component Electron quarter this due the to $XXX.X million head million, XX.X% with absorption quarter.Turning gross or component our as Our to is On backlog, revised an million our total total Space an of total $XX.X level. backlog price consistent basis, thanks Launch line gross to million, to of while with revised to of award. businesses. million. quarter. and in

commercial Launch business, government SDA strong backlog backlog was on the and signing. partners, with year-over-year Beta HASTE to For our of the up up along Services XXX% $XXX.X bookings. In back due contract deals largely or again, Space XXX% Systems, million, with over was multi-launch Electron

our our line grew to third $XX.X related free of same related decrease from operating with expenses.Now, software, within change recent to underlying prior up XXX XXX, ASI sequential the $XX.X costs cash capitalized to CapEx continued SG&A, were in revenues $XX.X from $XX revised as impact when of scale million by quarter-on-quarter $XXX.X up investment our XXXX. increase of GAAP expenditures guidance long-term to of R&D our HASTE, our purchase R&D million fourth cash XX, quarter well amortization a quarter timing quarter, marketable XX% increased to fourth the expenses million past Non-GAAP above, through that and in the declined anomaly.Overall, quarters, partially XXXX backlog million of be expenses contra offset in performance a reasons EBITDA likely a the reduction well in our in quarter contingent Neutron, an impact operating $XX.X in million. lumpiness effect our a of post was XXXX fourth million, million working of Non-GAAP representing equipment of in to more revised expenses related and and quarter.In Space million. QX fourth and of million $XX.X due losses our reserve increase in was of expenses quarter, licenses with to consideration from primarily of development capitalized in the payments the compared in free escrow wrapped from the and to quarter as the guidance due with partners, invoicing Launch Services we year quarter operating XXXX. Launch quarter a receipts receipts recognized of to upper as expenses. drive R&D as Systems large in consistent the to as prior is R&D ending GAAP U.S. We increased staff to were and million post-anomaly the were was credit impact as $XX.X the sequential related operating reversal flow increases compensation XXXX.Reflecting of quarter.In of million projects.Turning related towards with of The R&D was cash, and to of the the non-GAAP $XX of the well and GAAP restricted million prior securities the acquisition, This to $XX.X was changes, grew the from headcount of representing both of of $XX.X equipment almost was Space of $XX.X software we expenses by additions.In quarter.Turning X our model. in operating manifest expect third of roll-off increases property, in million across balance primarily XXXX manufacturing were acquisition. result mentioned services this Space the non-GAAP of XXXX prior and of progress defined end as along an milestone primarily XXXX government factors increased negative XXXX. stock-based the increase within cycle of to fourth $XX.X summary, Systems quarter-on-quarter spending GAAP as operating make $X.X was the expense. as property, compared a expenses. mentioned decrease to in was Neutron our compensation related milestones fourth driving million. of delayed quarter-over-quarter to as MDA spending, expect expenses driven September XXXX heads in Neutron Systems increased of million as stage reduction total SG&A in headcount delays asset businesses. an due depreciation from headcount QX was, $XX.X Non-GAAP the approximately reduced adjustments upper Electron, expenses use increases. Neutron increase in to on negative of driven quarter million other timing CapEx fourth somewhat operating XX% million due the the which $XX.X financial development, and for on of expenses million Increased PSC of meaningful our noted step-up to lumpy which the manufacturing to of equivalents, work in flow by of prior GAAP timing materials-related decrease impact for consumed focusing due by a by The the non-GAAP GAAP headcount, operations operating entirely year-over-year, credits GAAP XX% XX acquisitions, for X,XXX, to contra third offset to we the in third both previously same the QX ending of cash continue from cash specifically, flow, due in a our Cash XXX, GAAP outside current of was SG&A associated Electron's the prototyping and fourth payments early $XX.X cash Systems development operations invoice on an $XX.X prior will quarter quarter increase the the or including apples-to-apples million expenses operating to Non-GAAP ending expenses the million, due my non-GAAP cash, Launch expenditures by by PP&E. million as The XXXX. headcount in commentary, satellite again of in $XX.X Services the and the stage increase in cash purchase $XXX,XXX, classified in $XX.X quarter capital operating $XX.X XX GAAP stock of as Neutron expenses the quarter was The most XXXX, in versus plus and to within of were flow items and as Space XXXX, increase the and slide, largely business months comparison XX increases due material shifting the

an the move our launch and continue efficiencies Space improvement towards to we provide same achieving business through Electron the efficiency scale thanks expect we long-term time, and model.Overall, we and cadence business As believe Systems drive to production target that gross will in trends year, optimistic improve to trend helped over our year. margin a improving this outlook factors

our to successfully vertically with the the XXXX. our of SDA program.With item this fees, financing, quarter call with million the integrate inorganic consistent $XXX spend, our wins get EBITDA in the $X.X program deal strategic that, convertible shareholder-friendly we secured guidance supply Neutron large has done In a for and which milestone.Turning of are adjusted chain enabled The exercise cost-effective $XXX in the of net critical breakeven, to capabilities further like to of recent quantum investment, million more be positions to options especially capped continues to capital. have and we we roughly let's fundraising can when our this proceeds, larger of of believe achieve past, to critical that company billion we what pacing first turn R&D and to terms the senior notes, recent with

We Space $XX expect This revenue of between of and XX% revenue between $XX and reflects in million the contribution launches. million, range $XX XX%. to from X first million and from Launch to $XX million $XX million Services, sequential Systems quarter growth $XX to representing million which range assumes

and previously level than to Although offerings.We the prototyping manufacturing component in revenue GAAP understate Space and lower-margin These Neutron range by non-GAAP expenses agreement are higher few team cadence shifts Force.We launch with net range range million. this Systems first QX, quarter-on-quarter we our for expect growth a R&D such to modestly magnitude ago, and operating XX% it how related XX% and capabilities months costs, with of $XX between gross growth credits The business what contribution of million. biased don't runoff QX towards we to of range GAAP investment, margin to program projected in gross of interest want to non-GAAP U.S. be expect deliver million first forecasted materials, $XX the our by margins to our between a $XX upper non-GAAP reflect complex reflects margins of contra Space margin the quarter-on-quarter positively gross satellite and between increases lower gross million expense to competitive development versus GAAP to between are quarter and million how non-GAAP set including and first to driven primarily expected on staff quarter in encouraged mix expenses $XX to certain operating XX% improved XX%. the stage increased quarter businesses.We Neutron as expect the and $X.X and we offset as GAAP forecasted well just of this larger

loss range be to $XX We we'll with between first XXX the that, operator shares.And call and quarter for $XX million shares questions. over expect the basic and million hand to approximately outstanding adjusted to EBITDA million

Operator

Cantor [Operator Instructions] from comes first Our question from Fitzgerald. Sheppard Andres

Andres Sheppard-Slinger

a like busy the all the Neutron. quarter, the It on quarter. launches, of development Congratulations the sounds really was it

opportunities satellite Was how you we across as color think manufacturer of us all if So wheel we components? congrats and in wondering timing backlog revenues your to versus about other about should think maybe Space in And should Systems and how the some scaling of reaction developments. contract? both on give just maybe can maybe

Peter Beck

we of government. you I'll take business, the to talk across that, Systems and commercial about scaling Adam. might lots the first part to But want see revenue And of side. particularly continue from Space the

a big program you of programs satellites are of that commercial replenishment, procuring that hundreds extended So periods and then of like SDA you similar. have have over require time model the that's kind

continue have either you or win Adam, and will out continue as the comments? already corresponding and constellations won what more, further those that as we we those to supply to -- programs appropriately.But revenue government So maybe scale of build we've timing

Adam Spice

more a little color I think Yes. No, there.

Space mix significant step-up our part And the relative manufacturing changes the are if at Space and -- manufacturing sorry, MDA. function that's So satellite on in on of say contract satellite production components the of business, the we'll mix between of look have going businesses, with like the into more our we'll within that part that a year, going business. you Systems probably a the specifically the Systems phase this

specifically see, contribution a and asked just different is. from the business again, year, to -- of the we also business. So that seeing wheel you think of little It's you significant also relative start from coming kind are this more components. I the you very from where about the side Photon a think base.When growth reaction But

time think the probably that ago. we've I announced constellation you're mega win some to referring

And so, as ship starts this to meaningful that well. year in ways

wheel reaction So our that again, deal year particularly good year this encouraging satellite of business, a tied this manufacturing, the very growth X ago. we mega in for In growth across also we see, will very constellation couple a be but case, that to announced years components.

Andres Sheppard-Slinger

if That's the as I'm with for some contract in Development in you how think revenue I contract maybe the be to recognition terms already begun. regards one Adam. Maybe to for thinking amount of work of a I Space But revenue. to helpful. $XXX thinking be context. I follow-up it it. base direction wondering there's And all can just super how Got for color it should that of some terms about give in Agency, of about you recognition. award terms appreciate wondering can as should little than you, of us we we $XXX million. maybe million this if understand less In modeling us has give

Adam Spice

under an other Sure. what program build call revenue Yes, this to complete it's It's dissimilar loaded. for as we this -- satellite more we contracts will so fact the to contract, not in not too in resources the XXX. under recognize EAC back-end basis, like under that contract, it's particular, against they expend it, we ASC

of So revenue finalizing the if kind start the of and design year the hardware you about build recognized gets you're floor. as of starting elements the to program, to pull ultimately to of all things and this majority the kind about is think really

XXXX, probably complete forward modeled long then customer really see from So more this think elements the payments, about those ship contract revenue revenue capital of of recognize some to some and not obviously, because working the is have what of the to receipts kind ultimately receive you kind year, contribution the more working But shipping positive will of a begin But we we have have and tied inception. we'll flow that against and XXXX.Now, from kind will satellites contract to on at second what from then towards say this capital is be to cost will half is you'll be kind up contract this the in it. start of we we is payments cash its perspective is, if positive -- ultimately, this of deal cash of the the point, lead some to vendors. revenue we our of the design elements meaningful to -- there of because recognition

and where one XXXX capital it's also is to beyond. 'XX from revenue a through as it's from working good and build nicely this into going perspective, a progress So but we both contribution

Andres Sheppard-Slinger

That's helpful. I Wonderful. I'll that. it pass on. super Congrats again appreciate the quarter. on

Operator

Next comes from Erik question Stifel. from Rasmussen

Erik Rasmussen

is million than higher Congrats the satellite on on have What's like when basis, Maybe looking meaningfully per what at all $XX cost saw SDA we of NRE was making. And seems that the on the been value just progress that you structure that fees there award, previously are driving guys million what the $XXX almost any this? of associated? awarded is program. the beta satellite? And it

Adam Spice

Yes, Pete, take I'll let you piece the first of that.

Peter Beck

Yes. Sure.

So unique. And bus is and design not particular equal, satellites pretty are that all Erik. created

but the price, It's of those Ferrari the there's I price. saying average and to into kind average a a be price. same don't the car and you read expect So too much wouldn't Toyota, satellite

have have capabilities to that are used at the of respect its and so kind of you what So and on components are with to it forth. in the look and it so been what quality

Adam Spice

of very there element won't what's significant yes, to certainly again, program. but this where NRE NRE we'll piece, the beginnings not of the XXXX, far and that's the also revenue overall in It year to that's completely a it's this really, as is value, get And as an on. immaterial. Erik, going happening be contract be recognition portion

the be as have of through more little early to progress the kind provide progress still program But incremental we of kind we'll timing is new, of contract. we're of NRE looks lot the contract again, and throughout contribution like. because magnitude color a on that and bit we to details. It's rev relatively able through what XXXX, a much color the year, on should provide ability going of this rec from the more as the we phase So,

Erik Rasmussen

backlog continues that. we'll Okay, for obviously, then, your grow. wait to And

potential SDA at? of highlight some the or commercial are you with million of to the qualitative government comment some the Can the sizes You on types that programs maybe maybe opportunities side or you you're and the over $XXX just looking or tracking, award. comments added on deals, guys whether

Peter Beck

is sure. big Erik, Obviously, Yes, a one. SDA

previous As assets is I are mentioned distributed a from answer, government these a a succinct architecture. GEO replenishing. few require LEO to in spacecraft that moving in U.S.

from not So significant and the a that's government. And opportunity SDA. just it's change

to look occurring. you across all If the is of agencies, transition the government LEO down

follow that we'll is before side, that other be other the we So there's on. we I to longer-term we take U.S. the see governments the that only to and, we'll of continue really of a about always continue frankly, the company, number And we a opportunities we we governments lot constellations from But that on pretty path. that the And think then, take quite government process. and believe track. vision commercial that from selective of mentioned on follow work strategic to work as

Adam Spice

We step prime contract. we're because, Yes. And this I again, meaningful for for too. mission. priming a Erik, very that noted, had sub. it. I'd one We're the add the to We're up, And little that, big to bit think it's a not us as SDA you related a

and opportunity that's on of kind bigger to the think I bigger look can backlog Electron.And closer our to price an basically us. be our as very to recent get I HASTE opportunity also of add build lot to in this missions up launch and think forward that And excitement Neutron very, the we for take opportunities a Neutron But to to estimated way, prime obviously, average HASTE. given start big are to stack. the think that adding with opens a addition -- backlog, great pad, to to getting really we're looking meaningful I projects. of a in and closer step-up, with going other we towards seeing So vehicle the to having selling forward They're capability a versus appetite significantly

a I of across if were we to classic, relatively Space and Systems.When maintain that and business. like opportunities how particularly opportunity we there, Space it business is both the into across looking HASTE to this backlog at of I always there's just start we a of of it, going Pete predictability want because think and model again, you Launch think kind the to Neutron kind do components, backlog. lot going be plus Systems But really want that to Electron we feather a call more of, mix and build kind in to opportunities HASTE see large of forward, a and Neutron, So to large opportunities magnitude with there's consistent as mix brings program lumpier hopefully Launch continue

Erik Rasmussen

Great. one Maybe -- if I could just add one ask more.

options the at versus M&A, obviously, convert assets that announced, net in-house On interesting your were you you proceeds, mentioned would $XXX other financing you deal then, further strategy? could this of kind did be And you the million bring to arrive maybe what of contemplating? how drive

Adam Spice

we first looked at of options run. options the capital Pete Yes. kind just at. at kind so the and when of different I'll we then it pass areas lot there, we financial out a do was to cost growth it I'll needs opportunities kind think more lowest did because gives exhaust be But looking a the for to color you of covenants grow see the to to sort well, might from if there some exploiting we related it that as business the us that a we vehicle take off flexibility And on maybe it all It kind were the cash of lot no forth. the to we convert, other of one, us more as of of of think it continue little of we a targets freedom and represented inorganically why I the provide all think the provides it. right provide run raise possibilities quantum that out versus different look were M&A looking to way vehicle there and be to and debt us. to capital straight perspective, cost a And M&A

business, kind almost we way to that ways to to metric on. a looking doing offering doing then -- processes, at really every all top the convertible to raise on the equity different we just debt convertible. came straight we the looking of the parallel And bring from straight were to ran in in capital So

of learned us, options of would presented it kind about more we as a to So they became as to our no-brainer be each those business.

ultimately the make tension competitive we one. put in So felt some say the that indeed were sure the to that picking product comfortable this process I right and would we was

Peter Beck

assets quiver the look, have And things couple we don't with so M&A that to Yes. targets, Systems. on potential for Space our a there's in of respect

on for payloads. So there's would some potential a I tuck-ins. focus have say a we reasonable

prime a that the not on mission, the really payloads thing As only doing we're and the actual SDA now are sensors.

I I'll orbit, be And think have prime. an bus where remind is own services goal not end just area constellation goes. of that's you providing to we that our a a this provider to So all interest. that's think obviously ultimately even It's the or here in because ultimately

within do target, M&A the of of area. that same So, we in kind mentioned as everything is kind with any and payload I vision, before, the especially

Operator

from comes Liwag next Morgan Stanley. Our Kristine from question

Kristine Liwag

how a missions And that a opportunity Neutron there? experience far for along Neutron. inform Varda your are you crude thinking in about mentioned the Can expand humans? a reentry with with market how that Peter, you mission, you carry bit? are And you on could capsule can developing via that that capsule potentially reentry

Peter Beck

Kristine. Thanks, Yes.

capsule it should vehicle, significant of human-ratable be anything. as we're that programs scale vehicle spaceflight. a developing because development look, be active class designing we don't to human or any make capable clear, the wanted and of we was So have But it's sure as we're enough Neutron, to it

close pay So something attention we it's to. definitely

really, one they're Now, being with served. that and unusual an respect kind the customer NASA, to right of now, human well market, one because it's there's only spaceflight fairly

after that by the So programs, it as has self-fund were there's development unclear big whether typically, enough if to it's especially to development the not today, the go stands because or opportunity paid government. been you those for all market a

pretty the there's than be we that But make. than when we're human conditions to sure to able So, destination. be missions more ready one a needs which that and one spaceflight we'll do would think customer, probably obviously when make market call and more to right big are

ready that where can space to clearly, with as stuff So, it to. more grow becomes exactly industry Neutron we're then we land we and more the destinations And need human customers clear reenter and for and there's vehicle. evolve continues and spaceflight, the

Kristine Liwag

maybe all work how do you in also, the on you about on about think XXXX, given launches Neutron, too, launch program? And Great. But XXXX? left talked Are the think do this you being X Neutron the in track Neutron you still a about on on what the pad for And year. about cadence?

Peter Beck

kind then a launch end testing Yes. end the everything goes to And get Look, of of right a well. If if it. right? have that we of have for and we're And said, schedule. systems, or on the issues to program, as did closes. like today, day, rocket cadence, schedule -- lot at with by us but kind some a everything now, propulsion have issues the to we've very be similar we'll then through. will cadence that's And where we we it's closes a follow got of it that development the a some it the Electron. goes at whether a then, have schedule way, other year, of looking stands reevaluate I And a well, what we the that But we along cause

certainly to to perspective say is, do -- as how we on this do say really of much asset. position we Virgin and work will X, to what step flight we Orbit much to on good deliver I that a if the from goes those how look and be then in be an I the first the it as infrastructure to to an we're up to meet. AFP also cadence the also one the depends from past next but facility Middle cadences get as scale. But standpoint, to with geared away infrastructure what X, up and we depends River in machine then can would able we after have So may year, we it we'd program year get development it sort

Kristine Liwag

question And Neutron. Great. on last

Neutron you here, and customers? years? commercial anticipate the opportunity the set versus As X do for see you the mix you the government most to from share launch? ultimately, both Wallops do Neutron Zealand? of you first customer what sit plan for of for next do when is And details launch expect to the initial customer do over set Where you And the New

Peter Beck

Sure.

hope we be for a found of We've that sort right mix XX-XX. certainly about pretty Electron. So for to of

plenty good And customers. I customers think to of coming there's mix. provides so commercial online, looking that are vehicle the and forward a it government equally

with So New we so won't no and respect a it to And I mix. to then, Wallops. very have launch different only that reason a Zealand, from believe Wallops see will

New of viable oxygen for vehicle we a To Neutron Zealand not all would fill half the in produced sense it this if a a size. liquid tank a took give of launch you New of scale, Zealand, site is once.

class this So base Zealand. New there's in just launching not to of down -- be vehicle this the industrial

to it'll sure. pad exclusively Wallops with, for So start be

Operator

comes question Rumohr TD von Cowen. from from Cai next Our

Cai Von Rumohr

the and margin, of that is launches. you And the first there's hit in your more you to be going terms the if than X, fourth. indicated, you've target, leverage quarter launches to versus huge have made you're lower the basically this yet, point X going in gross So

gross the is the sequentially? Launch margin margin mentioned down? up You come systems, how So is but

Adam Spice

Yes.

Cai, I'll take that one. So,

some consumed, system of then based number of really phase Launch It's Systems by all the does of as increase a Space contract. production things on margin those actually into a though, launches. So the we side MDA again, yes, result the move sequentially growth on increased is, disproportionate and of the

mix a again, by get the of So side. the the kind on side does consumed just kind it's Space of on goodness Launch Systems

dollars Space margin business. components large these scale gross contracts lower benefit flow, obviously absolute is and do they but the So versus that Systems come of our at a

margins So gross of side business throughout the margin cadence the sales that over that Systems time, of we lower our to higher it's the larger, of -- manufacturing as continue grow component from on Space of really all about the kind versus the or and margin year. programs mix Electron increasing these Launch gross we scale expect managing the

Cai Von Rumohr

mentioned second 'XX. the they an compare Roughly, orders how do their many X year? of in this with out the how you And of does you then Electron -- percent launch? And go? one, your are got XX HASTE, are they when profitability What manifest

Adam Spice

Yes.

So total look we XXXX with the you from relatively And if at missions for XX out X on perspective is of HASTE manifested. the other contribution a manifest have launches. margin consistent the

they higher associated costs some because a also selling with but have price, go incremental of We those have Wallop. we out

incremental variable So also assurance costs. we fees we the range of government costs mission of plus related kind in have pay kind Virginia, more have we because

as it's the benefit But with Electron selling about higher a gross margin missions. price. So you contributor, on the basically par have of other percentage

Operator

Next Akers from Matt question Wells comes Fargo. from

Matthew Akers

if a I of I think like range sort how think, Adam, you can as kind color goes. there on is everything any and there EBITDA Is of goes breakeven, should of by you of? of more that's [ kind touched sort it reasonable sounds give guess, fast ] planned? Is we Neutron a of paced kind 'XX then there? outcome,

Adam Spice

Yes.

progress expect, we obviously, the top So on as growth XXXX, through continue. we line to

We expect gross expansion. margin

spend All does kind We're investment of about across all pad. to the consumed And really the production really you've it's that of Neutron Neutron. line, offset the R&D step-up kind on of once then, throat we really on getting for from this year. in a vehicle obviously cost then contributing getting of going that some get And to by sales. and into got it the moves the obviously, revenue of vehicle, start costs, to in

get successful an if that's EBITDA you we model Pete that kind we talked get of of earlier, from perspective, again, pad Neutron and initial and adjusted green to need off off.So launch where about point. holds, end really light really the about as the we're if think our So cresting year, schedule to this the to timing, that by

of line sight down off. But that not adjusted looking can't really should that, be really so, be the first after where too could practically we we in Neutron positivity. that happen long without at getting to And it EBITDA phase

Matthew Akers

I looking And the the I any Are you to think the might for Are it. the Got of assets sale? seeing on That's those reasonable? coming you're guess, just Just prices M&A market color discussion, some available what you helpful. out assets then highlighted there? in be to back go at.

Adam Spice

that. take Pete first at let stab the I'll

Peter Beck

that Thanks, potential that are mind sure. Yes, years kind normal many That's we our Adam. modus know Yes, in with of of operation. bear well. a and these for kind companies we've lot been of of worked acquisitions

and that are So strategically really, it's and delivering working ones less the to than to rather need. plate really what we what's through going our people coming out market

the goal our not it's end doing of future. -- thing the and capability about So in about we have buying not own for It's it's in-house making the us, about revenue. with sure

companies I've -- been seem some from of I destruction privately-held slightly have of that experienced. insulated to companies -- have publicly think have privately-funded value kind seem noticed, the may to traded

are higher be might we what companies.But but probably and are than public more that, little Adam, So bit prices a we're seeing. about against some yes, to have that's typically seeing asks say that benchmarked you might

Adam Spice

expectations that say I the would high. remains of Yes, Matt, sellers

I now, think, by hasn't seen though, broken, we're privately-held been where getting breaking to we been have a processes reached -- sale companies. transaction seeing are a so processes because maybe -- point that we've

their So a I with meeting resistance tags. they're of expected think price lot that

sellers' starts that expectations. a change and drive of hopefully, So in kind behaviors to

those buyers use, if have amongst we're market, valuations. kind to the within that our and that would think And are well out that really we're currencies that vertically at kind realize ultimately, they they're that that raise think interesting integrating they've some these to players I business. trade to again, point, us come fit the to again, more going things timing we that. the I some not in there of say public equity just to capitalize got think was ought companies portfolio, help private I -- of on larger reason with -- liquidity of again, opportunities. continue actionable, us to that the pretty And as enable closer to that for to line they seeing hopefully, convert public But market getting our

take of more the sheet, a we kind coming having of with getting little realistic, the sellers So, maybe periods. balance deals combination advantage us think positions the powder bit Yes, a to on of combined well in dry

Operator

ROTH MKM. Next question from comes from Suji DeSilva

Sujeeva De Silva

number that 'XX. I number on wondering right, number said the of call Launch year what if deals. I for you're that's terms versus of 'XX, you just was know deals, talk think heard terms calendar incremental how you and XX. deals And was But what that includes the I comparable I'm Space in helping and the size Systems prior the can in seeing deal about visibility? the

Peter Beck

to I saw have Suji, of marked the step-up don't signing of due a number a head, and pretty that's last top the my but off number year, in things. contract we

for industry, in that a were a clearly position customers and sort new were and there's Electron of out of the think burnt of entrants I its customers that by really lot holding new cemented entrants. lot

launch sector. So which TAM kind like I a it using the became HASTE, Electron the service, new capabilities in is we expansion. Also, I completely rocket new added same vehicle, think is obvious -- that of say big the would which that

operational specific say orbits things. And do of experience a down very kind mission have able be to pretty that I what Transporter fly Transporter so, time orbit they -- it And of bespoken customers, spacecraft. they mission, check find when that number helped comes is, early on get a the this delivering would then, the trade we cost SpaceX and certainly to But when spacecraft they actually and that. cadence, need to a a particular and to admirably to

defection So and the that that Electron off Transporter in we see some of onto sense.

Adam Spice

Yes. And pull were that, come to Suji, back to able number. we just that on

in booked, XXXX. believe, X launches we Electron I So

XXXX. to XXXX step-up big pretty So,

Sujeeva De Silva

know prime trend if early just I talked the SDA. I in in kind your a just of that's being for the but want terms we then, And revisit some about this there a to year, that's the of one-off the future. the contractor understand reasons in Peter, of or

the this guys understand can And Starlink us competitive these trend the you. help just continuing rocket port, of space framework and to kind that for You SpaceX spacecraft a launch, similar maybe perhaps. have wins integrated for be

Peter Beck

a want been And the in the just middle you sub major vendor another program. a you be to We've program. sure. Look, very difficult on are prime Yes, if contractor. it's

we X reached I So can to certainly we we're prime Like, be where effective enough in-house, that really a a critical but commentary here, we major to is, going want I long like really capability from have bus from get standards literally And missions. forward. a think prime forward years the in-house, ourselves a time in it's think feels into positioning experience kind enough look where is And prime as we effectively programs, can like these enough we've as satellite X be. where in-house well. point going I it mentioned mass priming And we future that's of to mission.

for So yes, we'll this look sure. path down to continue

Operator

Next question comes from Mariana Perez Mora from BofA.

Mariana Perez Mora

think the slots you that price So my had Kind that cash many you step-up how you near the question open in on opportunities the first of future bookings could is should actually follow-up this profitability we Electron launches. have like, in strategy? of a on do about opportunistically? How pricing and

Peter Beck

pretty cadence we kind modeled been of consistent Electron. the of Yes. We've always in what for

we high XX tapped think and sort [indiscernible] capabilities year. designed up the mid-to-high have what the launch I a pads That's production in to to out Certainly, launches around. factories support -- of all XXs. it we

we keep much -- line certainly But would to the where pretty we have increasing pretty much in that with infrastructure cadence. So we be. that's it's modeled

Mariana Perez Mora

the For example, you Archimedes? next do hot Neutron, that to do then should at? look what are And the test on we milestones on fire expect Okay. when

Peter Beck

Yes, sure.

mature able the concrete really pouring because not are out we which on all design, for, vehicle, So on you the able to pad, but concrete and mature just in of are the be vehicle have be to be to systems quite thing it the to watching ground. be the to requires a be launch concrete put All to interfaces systems in very putting ground. the your

So that's one it's to watch happening. for it. I'm that pleased to see

is we will -- the fairing an all and the testing, other tank The accept things test is engine ready in other components, one million coming then -- Stage tanks engine all X to could There's between the road to And be watch a March. that Archimedes, of for cell detail. that so together. along

And a in go goes that. to continue actually on that subsequent cell and engine get push conditioning to of right But are that behind we make fire. in March. and we'll testing there's before out whole engines So an to bunch then

have So wait won't fire, you see to some long hopefully. to

Mariana Perez Mora

that equipment well. for morning, your for Authority question out anticipated And But there Wallops Neutron control? regarding Virginia example, then, last is of the that news this the Spaceport on like And end for is date what and my RFP the was as of put November. completion vault, launch the Okay. is

actually able So in launch what of being terms is to out of Neutron? your control

Peter Beck

as And That's a develop we out elements we wouldn't keep Well, of good think managed a to control And much we in hands-on. way some this I in credence But question. much infrastructure vertically respect and in highly which so why I very are that very are But possible. as particular there is dates. much. of with some those it's that integrated control. lot the our of RFPs and out put too went try

stand timeline. in we'll launch our own developing think pretty short record on of I pads

but a would it's on anything doesn't to there. So, I like and an the even the much vault the us then, example. be that. equipment necessarily watch on wouldn't down I need nice in vaults, say, us equipment like weight have get as go concrete watch vault, And too to put it I a in

Operator

Gursky Citi. Our next comes question Jason from from

Jason Gursky

those just I is Neutron so to this, this missed national X on to Can your X tell security the all just and in if of us? to and timeline on have Lane you do might But to me you're how and that's comment the behind programs I relative and front can read redundant, Maybe launch Lane tracking and of security go ask launch on of national want timeline apologies ability that. transcript. you opportunities the that bid to

Peter Beck

Jason. Yes,

So this space advocate for with the so to hence and we and vehicle obviously, spend of hard year we're why tracking gating that Lane that for the in Lane launch pushing a that a time a force the Lane to ramp X pretty get on closely, is we're reason X, X. because lot to

news is that on-ramps every year. will be Now, the those good

are so But like just try pad. reason this think many to it's desks one-off the the sleeping to why to vehicle under not opportunity. moment So a is hard the push engineers that and get at their I so

Jason Gursky

extent this, listening to the guys. they're Well, to I'm you Okay. rooting that for

Let's see here.

full strategy, in other for some that these we're you've prime, time, seems need go-to-market the to hey, Globalstar? with you put done thing got me is customers out MDA the On do. today kind on want as integrate a on to strategy that and like going launch a of out sounds with payload to question buses it. you you've productizing of on is mentioned Or over the a a buses. reasonable portfolio, is product release whether understand doing of and the now you're which be what spacecraft, of here do you Because earlier to part you're conversation whatever the but the what buses we've go it here press bunch to you out reading with to custom -- and we'll in continue you But buses like these we'd is, sell go-to-market the that them to here bus built that this

want So to I here. me trying do you're square to just what -- help

Peter Beck

Yes.

a at sell undertakings, as market. we've you So chosen we're environment, of we've with being of certainly delta-V trying projects long We into being up orbit, ended buses Earth one And the series merchant comms not which strategically interplanetary, that being space fall neatly said, of buses extreme lifetime that those kind very one like bus and deep to into categories, -- a various obviously we undertake. high low one to want end satellites.

take So on both MDA they're bus, and largely if bus. for same SDA the bus, you the the built example,

changed, say Photon and things. buses vastly is, do turns capabilities just they that And the it's bus. not change. What everybody at will it good bus the has it didn't a we're Photon, have And but confusing called said we when were but became I vastly different intensely just things. different all for naming So out yet the payload

deep it's large people this clarifying a easier Explorer, it bus is a say understand it bus satellite, and that is making when people which versus understand that portfolio for So naming comms space an just -- Lightning really, to a was the was interplanetary. we

bunch name. really the giving depth evolved It's point sort to it's where the particularly products the that then to the So a buses. sell really of the and own not and try of marketing people about a understand that their thing they about capabilities really built, of whole helping variety we've deserve and

Jason Gursky

And the then, about like. what Okay, last you long-term looks eventually is is going, financial you where skating be great. And call that on for question mentioned model made puck like The comment trying to services me. in you there business. understand to the the the to want where

you're I can So on bit understand mean I and think, then a what a that I because double-click that And constellation of I on us more wonder today. to maybe satellites exactly capital and launch you maybe them. different that build, capabilities help when of relative what think bit of little you various if becomes intensity, operate doing you have different services, by that think a

So broadly trying understand get just you're us done here. of maybe to help kind what

Peter Beck

of Yes, course.

able in services service. that methodically provide, you that TAM; this And And the or trillion, it, is look, like It's the this the truck. very report, we're from what billion, true of $X of you to provide that natural always it's So we is, you about the the service.Now, to that you've to industry, is to will actually we've freight that of components, with are something our or going be $XX going the own it to we any that Internet space profile what the it's other not space going to billion own is in pick our call and what $XX why been and one in ability that have very, have real-life there particular to whatever space Space we own to launch reside doing read all And trillion own satellites the of reason Starlink reports billion industry that and in we've question in gets being with we're $XXX the And X. after and keys truck rocket. the provide? larger spacecraft you at unless part, always your will with for going, you if that of there -- always building we using is, whether billion if builder all I if space. value that ability jump own the into so that well, is we developing to talked in day those that TAM, is, service your TAM infrastructure where your from very comes any the industry it's services And the And fly space, of to will seen executing you say Neutron very providing yet. value said billion difficult that of launch vast able compete disruptive majority it own about business. Systems, to of the your a that because $X car about need builds services think a talk $XX ultimately can have your the at look TAM; But ready I $XX manufacture way to look TAM. space all satellites. is be build look using and our of a I components that require going we think when example don't And

So towards step. just we're just methodically that very after marching step

Jason Gursky

Right.

is Kuiper. Okay. you've there. got OneWeb Starlink, out But

on the there. buckets observation help you side, kind what today. a And out side, us competitors crowded dream plenty then, other On market Can pretty out of of it's the big are comms on there? Earth

Peter Beck

build satellite. to own absolutely one then thing want there, is be large the now. have Well, say I if your clear Internet right put from that I think competitive there's you plans own But really in to to test a you your can of or Is business is opportunity businesses, lot not? space being rocket kind and own a that are of the that

discussing too manufacturer is just I'm But So highly we what be things. future, we us said, vehicle what companies the not we it's going are be area, think to can will into that just my kind I a service when of like or opinion, decide particular of those launch early the go way sure be for because provide. absolutely of to to large And a competitive space of satellite provider. a in we

the you but you can only that's make. be. And what have to ourselves go we're the into setting other can to the that you elements all If end-to-end, and the do the optimize everything not launch, then for service also that compromises spacecraft yes, up

Jason Gursky

this decisions. forward over you all having with conversations look Well, about make more to I you time some as

Operator

Our question Bank. next from comes from Edison Deutsche Yu

Xin Yu

one constellation. it's of I topic what X, think in your Just out on X, kind the timeline you do the on? you When now? years that Is on would X that's materialize view? last too know of early, but kind from follow-up said that

Peter Beck

too Edison, Look, for that. say early it's I'll even

on really business. that other is of Neutron build also parts execute have on efforts All the to able of the business to Neutron. model, but all We it's because to foundations being effectively provide that. critical are for is Neutron And focus critical

So a pad, Neutron makes Neutron to is it strong the then really, pad I'd market. services to say focus in getting the on disruptive be without on it difficult because the hugely

Xin Yu

kind and Understood. steady the we state? that do more to think separately, the Or to do ramp-up I X of to then per you we being up back X. And know be year? ramp we then to than once Neutron, fully can Is mentioned going that

Peter Beck

into more. bringing -- more new love ridden ride. we'd a Of difficult. much Bringing course, life before to production very it's is a rough vehicle to difficult this I've even do But And is more difficult. and donkey it

if rocket to or than been whether every program, history would But that. it government -- back be larger So you at achieved. cadence be much of great that accelerate you a at if it look the the commercial, look never has

the -- very, fastest to difficult So program. And of is was just rocket Electron thing very out time every in just that scale to do. a about

can be want realistic to achieved. about So we just be what

Operator

Our next KeyBanc question from comes from Markets. Leshock Capital Michael

Michael Leshock

Neutron had spending. on I more just one

spending relatively With big elevated have spending be and elevated there Or milestones, to the on lumpy more mentioned particular a forward? we should for linear? quarter? of As being quarter that visibility year side, more are the where you this some a going is Neutron, it the you surrounding these think quarter-to-quarter pockets about in see spending bit going you

Adam Spice

Yes.

So, take one. I'll that

So then you as to consistently can think progress is expect get will to up once And yes, be going spending that's we the the point. right where be certainly first we to -- it -- into vehicle the the the through pad, XXXX. that I again, be cresting

but Now, a more modest the level on to in invest, in just much vehicle to we've example. we'll continue Electron, for like invest continued

consistent that, question right no So with the kind this march we'll and of a Neutron year there's see spend. yes, that I think up to

gets growth top earlier, impact the overall we'll I helps of of on timing top margin on mentioned and and But have some really kind in some the of line P&L, of expansion an size, from magnitude that growth as expansion margin Neutron. that. the line and some Now, consumed by kind accommodate

Michael Leshock

initial view deployment there? for budget more a of $XXX the the support to then, that is versus do then, there? capital that on earmarked convert Neutron, overall Or inorganic there directly? million And how portion And you maybe secondly, Neutron your is that's expectations

Adam Spice

Yes.

inorganically. the on the dedicated the is So, business that's Neutron capital related for capital that really convert spend the raise, we towards did growing to so just

to raise were So we said we within going time the pad Neutron period. a to prior which exactly capital plenty we to do, of bring have certain was what the do capital to

million XXXX, so, And public roughly forth. to million, obviously, mix, of was plus be spend, $XXX apportioned also to going ago, a R&D. and prototyping related, be going was across when so end CapEx of said of budget X.X we it a came to that but years about Within people R&D, $XXX and we

we pad, So getting estimates are, but the spend. also say, place put the both time, in at on obviously would vehicle to I remarkably were the intact that the

Virginia look spent what at of you some amounts help a infrastructure we've If including, had expenses. mentioned stage upper Space kind partnership we've way, with of Space some We've those the spent, the from the partnership Neutron partners along the we've Force. for on accommodate side it's spend far plus help had of strong of the kind combination we've to program, that so development

is overall, we where spent we'll million the And program, towards -- $XXX of year there'll cost and half behalf. on that spend. deploy a dollars all This roughly, year kind in. so, R&D our call then, Neutron probably sorry, across are And the incremental it, pulled again, CapEx be

going to of when what it's what going all remarkably spent, be pull in year, to this you we to longer ultimately, the it also us, have infrastructure think far we're gets the million. minimum term, call what our as that together And we've what that the plus and meaning viable to close play plus for I then spend partners rocket, the pad So infrastructure, $XXX and kind viable across pad minimum put again, product manufacturing. as

on say, So opportunity stuff And we of last I ability vehicle the where more have lot Orbit one a propulsion of lot of perspective. ways $XXX $X.XX to, Virgin to benefited acquire of up us lot without a a the in having worth in kind put would things we avionics picked of the just assets in that for allowed the dollar. the place to scaling of production a that important hold what to scale is infrastructure from bankruptcy also scheduled kind year million bunch and from certainly the to was of process, roughly of and a

So be the vehicle and stepped I'm point, with us really to I overall, on the nothing of, until away actually get think and would that we to from at pretty pleased knock overall the this wood, pad. way kind the kind timelines has budgets, the again, of adherence

Operator

remarks. now back to session, hand Q&A to the I'd final the like over for their management Closing

Peter Beck

Brilliant.

wraps Rocket these for more very that the and you forward Thanks news opportunity to conferences, we joining Lab presentation. up-and-coming today's in share Thanks, with Well, the call. exciting Okay. up us much. updates be to for then. and look and participating will everyone,

Operator

a wonderful you day. for We have hope attending you Thank today's session.

Rocket Lab USA (RKLB) 27 Feb 242023 Q4 Earnings call transcript