Rocket Lab (NASDAQ: RKLB) is more than ready for the space industry’s takeoff. The small-satellite launch business and SpaceX rival is now one of the most compelling growth stocks. The company’s stock has soared by more than 450% over the past 12 months, as of this writing. Rocket Lab is firing on all cylinders.
But how much growth could be left for a stock that has shot up so much so fast? For investors who see a future beyond the reaches of Earth’s gravity, the day is still young for this otherworldly stock.
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Launching toward profitability
Rocket Lab posted its strongest quarter ever in Q1 of 2026, with revenue reaching $200 million. This 63.5% year-over-year increase is an impressive growth rate for a company that did slightly more than $600 million in total revenue last year.
The company has been consistent in its launches and growth each of the last several quarters. While it still had a net loss of $45 million in this most recent quarter, the losses seem to be narrowing, and margins are improving.
Rocket Lab’s backlog more than doubled from the previous year and now exceeds $2 billion. Impressively, it’s estimated 36% of the backlog will convert to revenue within the next year. Executing consistently on the backlog will provide both short and intermediate-term revenue for Rocket Lab.
All systems go
The company has a dual business model between its launch services and space systems. Part of Rocket Lab’s expansion is the successful launch of its Neutron rocket, a medium-lift, reusable vessel. Its maiden flight is targeted for the end of 2026.
If it is successful in its mission, the company’s potential market and applications will expand significantly. However, any issues or setbacks could be detrimental. Investors should keep a close eye on Neutron’s progress.
Rocket Lab has also made some recent acquisitions that move the company closer to its full potential as an end-to-end space infrastructure business.
Riding the SpaceX wave
In addition to the upcoming SpaceX IPO, which is bringing immense enthusiasm and capital into the space industry, Rocket Lab has significant potential revenue streams. It’s a launch company with a proven track record thus far, which is an important competitive advantage.
There will inevitably be significant hype around Rocket Lab in the coming weeks and months, given its proximity to SpaceX. Investors should look well beyond these short-term headlines. Rocket Lab is a company on the rise, but there are still plenty of risks, particularly with the heavy capex spending that this type of business necessitates. Share dilution and quarterly losses are factors investors should also consider.
