Rocket Lab Corporation (RKLB) Down 17.7% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Rocket Lab Corporation (RKLB). Shares have lost about 17.7% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Rocket Lab Corporation due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Rocket Lab Corporation before we dive into how investors and analysts have reacted as of late.

RKLB’s Q2 Loss Narrower Than Expected, Revenues Increase Y/Y

Rocket Lab delivered a narrower-than-expected second-quarter 2026 loss, supported by better-than-expected profitability. The company reported a loss of six cents per share compared with the Zacks Consensus Estimate of a loss of seven cents, delivering a 14.3% earnings surprise.

RKLB’s Revenues

Quarterly revenues totaled $234.1 million, which surpassed the Zacks Consensus Estimate of $232 million by 1.1%. Sales rose 62% year over year, reflecting continued momentum across the business. Notably, Rocket Lab ended the quarter with record contracted demand, with backlog reaching $2.36 billion, up 137% year over year.

RKLB’s Segment Mix Drives Solid Gross Profitability

Rocket Lab generated $181.3 million in product revenues and $52.7 million in service revenues in the quarter. The company reported GAAP gross margin of 36.1% and non-GAAP gross margin of 41.5%, both above its prior guidance ranges.

Space Systems revenues amounted to $189.5 million, up 94% year over year, driven primarily by spacecraft manufacturing growth and acquisitions. Launch Services revenues totaled $44.6 million, down 4% year over year, mainly due to revenue-recognition timing related to HASTE missions.

RKLB’s Expenses Reflect Neutron Investment and One-Time Items

Operating expenses totaled $142.1 million, with research and development expenses of $82.4 million and selling, general and administrative expenses of $59.7 million. R&D expenses rose 25% year over year, primarily due to Neutron development, incremental spending at recently acquired businesses, higher staffing costs and spacecraft-related prototype work. SG&A expenses increased 50%, reflecting acquisition-related spending, additional staff to support revenue growth and transaction expenses tied to the company’s acquisition pipeline.

The company continued to invest in Neutron development and production scaling. Management also highlighted a shift in spending from R&D toward flight inventory as Neutron moves closer to its first launch, while production-related headcount increased during the quarter.

Rocket Lab’s Liquidity Update

Rocket Lab ended the quarter with approximately $2.13 billion in cash and cash equivalents. Including restricted cash and marketable securities, total liquidity was roughly $2.4 billion, reflecting a substantial sequential increase in financial flexibility.

The increase was driven largely by $1.08 billion of proceeds from at-the-market equity issuance during the quarter before the program was terminated. The company intends to use its liquidity to support acquisitions, including the pending Iridium transaction, as well as Neutron development, working capital and other corporate investments.

RKLB’s Q3 Outlook

For the third quarter of 2026, Rocket Lab expects revenues to be between $250 million and $265 million. The company expects GAAP gross margin of 29-31% and non-GAAP gross margin of 35-37%, reflecting an expected shift in the Space Systems revenue mix.

GAAP operating expenses are expected between $143 million and $149 million, while non-GAAP operating expenses are projected in the band of $121-$127 million. Rocket Lab also anticipates an adjusted EBITDA loss of $17-$23 million and net interest income of $21 million, supported by higher cash balances. Management expects negative non-GAAP free cash flow to remain elevated due to continued Neutron development and production scaling.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in fresh estimates.

The consensus estimate has shifted 21.43% due to these changes.

VGM Scores

At this time, Rocket Lab Corporation has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Charting a somewhat similar path, the stock has a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Rocket Lab Corporation has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

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This article originally published on Zacks Investment Research (zacks.com).

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