Firefly Aerospace stock soars over 30%: here's what's driving the optimism

Shares of Firefly Aerospace surged more than 30% at open on Thursday after the space technology company reported stronger-than-expected third-quarter sales and raised its full-year guidance.

The stock also got a boost from the company's announcement of its plans to resume Alpha rocket launches between late 2025 and early 2026, following safety upgrades made in response to a September explosion.

The rebound marks a sharp turnaround for the stock, which had fallen over 70% since the company’s August IPO.

The company’s third-quarter revenue climbed nearly 38% year-on-year to $30.8 million, exceeding Wall Street estimates of $27.5 million.

However, Firefly posted a net loss of $140.4 million, or $1.50 per share, a wider loss than analysts’ projected 42 cents.

The company attributed the figure to costs related to its IPO, foreign exchange expenses, and executive severance.

“Our strong third-quarter revenue growth reflects steady execution of our spacecraft teams on multiple contracts as well as progress made by our launch teams,” CEO Jason Kim said.

Alpha rocket to resume launches after explosion setback

Firefly said it plans to resume Alpha rocket launches between late 2025 and early 2026 after making safety and design improvements following a September explosion.

The mishap occurred during a ground test of an Alpha rocket, delaying a planned launch for Lockheed Martin.

The company said the failure was caused by contamination that led to an engine explosion.

Strong sales outlook and growing investor confidence

The company raised its full-year sales forecast to between $150 million and $158 million, ahead of analysts’ estimates of $136 million.

Firefly’s guidance implies fourth-quarter revenue of about $52 million, compared with Wall Street projections of $36 million.

Revenue for the nine months ended September 30 nearly doubled to $102.2 million, while net loss widened to $257.3 million.

The company completed a $932.3 million IPO earlier this year, acquired data analytics firm SciTec for $855.6 million, and ended the quarter with nearly $1 billion in cash reserves.

Deutsche Bank cut its price target for Firefly shares from $40 to $30 but upgraded its rating from “hold” to “buy,” citing the company’s improving revenue trajectory and potential in the space-launch market.

Can investors view Firefly in the same light as Rocket Lab?

Firefly’s progress is drawing comparisons with Rocket Lab, one of its closest rivals.

While Rocket Lab remains far ahead in launch cadence and market valuation, analysts say Firefly’s faster-growing revenue and heavy investment in capacity could help close the gap in the coming years.

Rocket Lab is currently valued at about $31 billion and trades at roughly 27 times its projected 2027 sales.

Firefly, valued at $3 billion, trades at less than four times. Both companies are expected to achieve positive operating income by 2027.

"Firefly isn’t profitable yet, but Wall Street projects positive operating income by 2027. That is the same year as Rocket Lab," Barron's said.

At the same time, it added that Alpha is designed for rapid deployment, while it can take weeks to prep an Electron or SpaceX Falcon 9 rocket for launch.

Alpha also has more carrying capacity than an Electron rocket, which can carry 300 kilograms to low Earth orbit.

However, "A few more results like this and investors might soon be more willing to treat the space technology start-up like its peer Rocket Lab," Barron's said.