Q4 2026 Planet Labs PBC Earnings Call

March 19, 2026

Speaker #1: Thank you for joining us, and welcome to Planet Labs PBC Fiscal Fourth Quarter and Full Year 2026 Earnings Call. After today's prepared remarks, we will host a question-and-answer session.

Operator: Thank you for joining us and welcome to Planet Labs PBC Fiscal Q4 and Full Year 2026 Earnings Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. I will now hand the conference over to Cleo Palmer-Poroner, Director of Investor Relations. Please go ahead.

Speaker #1: If you would like to ask a question, please press star 1 on your telephone keypad. I will now hand the conference over to Cleo Palmer-Porner, Director of Investor Relations.

Speaker #1: Please go ahead.

Speaker #2: Thanks, Operator, and hello everyone. Welcome to Planet’s fiscal fourth quarter and full year 2026 earnings call. I’m joined by Will Marshall and Ashley Johnson, who will provide a recap of our results and discuss our current outlook.

Cleo Palmer-Poroner: Thanks, operator, and hello, everyone. Welcome to Planet's Fiscal Q4 and Full Year 2026 Earnings Call. I'm joined by Will Marshall and Ashley Johnson, who will provide a recap of our results and discuss our current outlook. We encourage everyone to please reference the earnings press release and earnings update presentation for today's call, which are available on our investor relations website. Before we begin, we'd like to remind everyone that we will make forward-looking statements related to future events or our financial outlook. Any forward-looking statements are based on management's current outlook, plans, estimates, expectations, and projections. The inclusion of such forward-looking information should not be regarded as a representation by Planet that future plans, estimates, or expectations will be achieved. Such forward-looking statements are subject to various risks, uncertainties, and assumptions as detailed in our SEC filings, which can be found at www.sec.gov.

Speaker #2: We encourage everyone to please reference the earnings press release and earnings update presentation for today's call, which are available on our Investor Relations website.

Speaker #2: Before we begin, we'd like to remind everyone that we will make forward-looking statements related to future events or our financial outlook. Any forward-looking statements are based on management's current outlook, plans, estimates, expectations, and projections.

Speaker #2: The inclusion of such forward-looking information should not be regarded as a representation by Planet that future plans, estimates, or expectations will be achieved. Such forward-looking statements are subject to various risks, uncertainties, and assumptions as detailed in our SEC filings, which can be found at www.sec.gov.

Speaker #2: Our actual results or performance may differ materially from those indicated by such forward-looking statements, and we undertake no responsibility to update such forward-looking statements to reflect events or circumstances after the date on which the statement is made, or to reflect the occurrence of an anticipated event.

Cleo Palmer-Poroner: Our actual results or performance may differ materially from those indicated by such forward-looking statements, and we undertake no responsibility to update such forward-looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. During the call, we will also discuss historic and forward-looking non-GAAP financial measures. We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. We believe that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

Speaker #2: During the call, we will also discuss historic and forward-looking non-GAAP financial measures. We use these non-GAAP financial measures for financial and operational decision-making, and as a means to evaluate period-to-period comparisons.

Speaker #2: We believe that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making.

Speaker #2: For more information on the non-GAAP financial measures, please see the Reconciliation Tables provided in our press release issued earlier today, which is available on our website at investors.planet.com.

Cleo Palmer-Poroner: For more information on the non-GAAP financial measures, please see the reconciliation tables provided in our press release issued earlier today, which is available on our website at investors.planet.com. Further, throughout this call, we will provide a number of key performance indicators used by management and often used by competitors in our industry. These and other key performance indicators are discussed in more detail in our press release and our earnings update presentation, which are intended to accompany our prepared remarks. At this point, I'd now like to turn the call over to Will Marshall, Planet's CEO, Chairperson, and Co-founder. Over to you, Will.

Speaker #2: Further, throughout this call, we will provide a number of key performance indicators used by management and often used by competitors in our industry. These and other key performance indicators are discussed in more detail in our press release and our earnings update presentation, which are intended to accompany our prepared remarks.

Speaker #2: At this point, I'd now like to turn the call over to Will Marshall, Planet CEO, Chairperson, and Co-founder. Over to you, Will.

Speaker #3: Thanks, Cleo, and welcome everyone joining us today. Last year was transformational for Planet, and I'm proud of everything that our team accomplished. We made incredible progress in the satellite services market, signing a $240 million agreement funded by Germany, and a nine-figure deal with Sweden, capping off three such deals in 12 months.

Will Marshall: Thanks, Cleo, and welcome everyone joining us today. Last year was transformational for Planet, and I'm proud of everything that our team accomplished. We made incredible progress in the satellite services market, signing a EUR 240 million agreement funded by Germany and a nine-figure deal with Sweden, capping off three such deals in 12 months. We launched 40 satellites, including 4 of our high-resolution Pelican satellites, invested strongly in AI, and announced a cutting-edge partnership with Google to demonstrate satellites for compute in space. We delivered record annual revenue, adjusted EBITDA profitability, positive free cash flow, and accelerated our revenue growth. We laid out a strong foundation for the year ahead, enabling us to continue that growth acceleration. Let's dive in.

Speaker #3: We launched 40 satellites, including four of our high-resolution Pelican satellites, invested strongly in AI, and announced a cutting-edge partnership with Google to demonstrate satellites for compute in space.

Speaker #3: We delivered record annual revenue, adjusted EBITDA profitability, positive free cash flow, and accelerated our revenue growth. And we laid out a strong foundation for the year ahead, enabling us to continue that growth acceleration.

Speaker #3: So let's dive in. To briefly summarize the full year results, we generated a record $308 million in revenue, representing approximately 26% year-over-year growth. Non-GAAP gross margin was 59% for the year, adjusted EBITDA profit came in at $15.5 million, and free cash flow was $53 million, representing our first full fiscal year of non-GAAP profitability—an excellent milestone for the team as we strike a balance between profit and growth.

Will Marshall: To briefly summarize the full year results, we generated a record $308 million in revenue, representing approximately 26% year-over-year growth. non-GAAP gross margin was 59% for the year. Adjusted EBITDA profit came in at $15.5 million, and free cash flow was $53 million, representing our first full fiscal year of non-GAAP profitability, an excellent milestone for the team as we strike a balance between profit and growth. Q4 was also a record for revenue, representing 41% year-over-year growth and our fifth consecutive quarter of adjusted EBITDA profitability. For the second sequential quarter, we achieved Rule of 40, which is our revenue growth plus adjusted EBITDA margin. On an annual basis, we achieved Rule of 30, a full year earlier than we anticipated.

Speaker #3: Q4 was also a record for revenue, representing 41% year-over-year growth, and our fifth consecutive quarter of adjusted EBITDA profitability. For the second sequential quarter, we achieved rule of 40, which is our revenue growth plus adjusted EBITDA margin, and on an annual basis, we achieved rule of 30—a full year earlier than we anticipated.

Speaker #3: End of period backlog was over 900 million dollars, approximately 79% growth year on year, providing us with excellent visibility to accelerating our revenue growth for the coming fiscal year.

Will Marshall: End of period backlog was over $900 million, approximately 79% growth year-on-year, providing us with excellent visibility to accelerating our revenue growth for the coming fiscal year. Defense and intelligence was a major area of strength for us in FY 2026, underpinned by global dynamics. Full year DNI revenue grew over 50% year-on-year, driven by strong performance in our data subscriptions, solutions, and satellite services. To recap our role here, Planet was founded on a core mission of making information about our world visible, accessible, and actionable to help both sustainability and security globally. As the geopolitical landscape shifts, security is an urgent mandate for governments worldwide, and our customers face mission-critical decisions in an increasingly complex and chaotic world, and this mission is critical to them. We view security as inextricably linked to sustainability.

Speaker #3: Defense and intelligence was a major area of strength for us in FY26, underpinned by global dynamics. Full-year D&I revenue grew over 50% year on year, driven by strong performance in our data subscriptions, solutions, and satellite services.

Speaker #3: To recap our role here, Planet was founded on a core mission of making information about our world visible, accessible, and actionable, to help both sustainability and security globally.

Speaker #3: As the geopolitical landscape shifts, security is an urgent mandate for governments worldwide. Our customers face mission-critical decisions in an increasingly complex and chaotic world, and this mission is critical to them.

Speaker #3: We view security as inextricably linked to sustainability. Resource scarcity and climate disasters are not just environmental issues; they are direct threat multipliers, or even triggers, for conflict.

Will Marshall: Resource scarcity and climate disasters are not just environmental issues; they are direct threat multipliers or even triggers for conflict. The defense and intelligence sector is essential to realizing our mission. Our customers rely on us to help identify unknown unknowns, detect changes, and warning signals that they didn't know to look for before they escalate into crisis. It's a critical part of our purpose. To highlight a few recent customer wins in this area, during the quarter, we received two awards from the U.S. Defense Innovation Unit. We were awarded a seven-figure extension of our pilot in support of the U.S. Indo-Pacific Command to deliver vital indications and warnings. The short-term contract demonstrates how customers can leverage Planet data and AI-powered analytics to monitor sites of strategic interest for critical changes and threats.

Speaker #3: The defense and intelligence sector is essential to realizing our mission. Our customers rely on us to help identify unknown unknowns, detect changes, and warning signals that they didn't know to look for before they escalate into crisis.

Speaker #3: It's a critical part of our purpose. To highlight a few recent customer wins in this area, during the quarter we received two awards from the U.S. Defense Innovation Unit.

Speaker #3: We were awarded a seven-figure extension of our pilot in support of Indo-Pacific Command to deliver vital indications and warnings. The short-term contract demonstrates how customers can leverage Planet data and AI-powered analytics to monitor signs of strategic interest for critical changes and threats.

Speaker #3: DIU also exercised an option under the existing Hybrid Space Architecture pilot with Planet for just under $1 million to demonstrate the cutting-edge capabilities of our high-resolution Pelican satellites.

Will Marshall: DIU also exercised an option under the existing hybrid space architecture pilot with Planet for just under $1 million to demonstrate the cutting-edge capabilities for our high-resolution Pelican satellites. During the quarter, NATO's Allied Command Transformation also extended its agreement with Planet to deliver persistent space-based surveillance and enhanced indications and warning capabilities. The award underscores Planet's position as a trusted and essential partner for customers seeking strategic indications and warnings across broad domains. Finally, last month, the U.S. Missile Defense Agency selected Planet as a prime contractor for the SHIELD IDIQ contract vehicle. Planet will now compete for awards under that program. Turning to the civil government sector, where full-year revenue was flat year-over-year. To share some recent highlights, during the quarter, Planet was awarded a seven-figure renewal and expansion by the German Federal Agency for Cartography and Geodesy, or BKG.

Speaker #3: During the quarter, NATO's Allied Command Transformation also extended its agreement with Planet to deliver persistent space-based surveillance and enhanced indications and warning capabilities. The award underscores Planet's position as a trusted and essential partner for customers seeking strategic indications and warnings across broad domains.

Speaker #3: Finally, last month, the US Missile Defense Agency selected Planet as a prime contractor for the SHIELD IDIQ contract vehicle. Planet will now compete for awards under that program.

Speaker #3: Turning to the civil government sector, where full-year revenue was flat year over year: the shares from recent highlights during the quarter—Planet was awarded a seven-figure renewal and expansion by the German Federal Agency for Cartography and Geodesy, or BKG.

Speaker #3: Under the one-year renewal, BKG will continue its countrywide partnership through which employees of more than 400 German federal institutions gain access to Planet's data and solutions for a wide variety of uses.

Will Marshall: Under the one-year renewal, BKG will continue its country-wide partnership to which employees of more than 400 German federal institutions gain access to Planet's data and solutions for a wide variety of uses. As an example, this expansion will allow BKG to track permafrost thawing across the Arctic. In January, we announced an enterprise-scale agreement with Slovenia's surveying and mapping authority to provide comprehensive satellite data and high-resolution tasking capabilities across the country's civil public administration in support of agriculture, urban planning, and disaster management. Shifting to the commercial sector, where annual revenue was down year-over-year. While this trend was expected, given our increased focus on large government customers and the headwinds in agriculture, we remain confident in the commercial sector as a significant market opportunity for Planet, especially as we continue to advance our AI-enabled solutions.

Speaker #3: As an example, this expansion will allow BKG to track permafrost thawing across the Arctic. In January, we announced an enterprise-scale agreement with Slovenia's Surveying and Mapping Authority to provide comprehensive satellite data and high-resolution tasking capabilities across the country's civil public administration, in support of agriculture, urban planning, and disaster management.

Speaker #3: Shifting to the commercial sector, where annual revenue was down year on year, while this trend was expected given our increased focus in agriculture, we remain confident in the commercial sector as a significant market opportunity for Planet, especially as we continue to advance our AI-enabled solutions.

Speaker #3: To share a few customer highlights from the quarter, specifically around our work in energy, we were awarded a renewal by San Diego Gas & Electric, which utilizes Planet data and analytics to monitor vegetation, health, and conditions within their service areas to manage risk of wildfires during the dry season.

Will Marshall: To share a few customer highlights from the quarter, specifically around our work in energy. We were awarded a renewal by San Diego Gas & Electric, which utilizes Planet data and analytics to monitor vegetation health and conditions within their service areas to manage risk of wildfires during the dry season. We also signed a strategic partnership with AiDash, establishing Planet as the preferred provider of daily and weekly fuel monitoring data for utility wildfire risk mitigation across North America. Through the partnership, leading investor-owned utilities are already using Planet data to identify where and when to deploy fuel treatment resources, reducing ignition risk and targeting high-priority clearance with precision that was not previously possible. Turning to our satellite services business.

Speaker #3: We also signed a strategic partnership with AI Dash, establishing Planet as the preferred provider of daily and weekly fuel monitoring data for utility wildfire risk mitigation across North America.

Speaker #3: Through the partnership, leading investor-owned utilities are already using Planet data to identify where and when to deploy fuel treatment resources, reducing ignition risk and targeting high-priority clearance with precision that was not previously possible.

Speaker #3: Turning to our satellite services business, in January we announced a nine-figure, multi-year deal with the Swedish Armed Forces to rapidly deliver a suite of satellites, space-based data, and solutions to support Sweden's peace and security operations.

Will Marshall: In January, we announced a nine-figure multi-year deal with the Swedish Armed Forces to rapidly deliver a suite of satellites, space-based data, and solutions to support Sweden's peace and security operations. In terms of our existing contracts for satellite services, our teams are continuing to execute well. We are progressing with the builds for our contract with JSAT and beginning to serve dedicated capacity under the German-funded contract. We're continuing to find that our satellite services contracts are a win-win-win. The customer guarantees their sovereign space capabilities in their desired area of interest. Our other clients will benefit from increased capacity and revisit rates in the rest of the world. Our Planet receives capital to forward fund our fleet build-outs. They also bolster our data and solutions offerings as countries want both speed and scale of our data and solutions and the sovereignty of our satellite services technology.

Speaker #3: In terms of our existing contracts for satellite services, our teams are continuing to execute well. We are progressing with the builds for our contract with JSAT and beginning to serve dedicated capacity under the German-funded contract.

Speaker #3: We're continuing to find that our satellite services contracts are a win-win-win. The customer guarantees their sovereign space capabilities in their desired area of interest, our other clients will benefit from increased capacity and revisit rates in the rest of the world, and Planet receives capital to forward fund our fleet build-outs.

Speaker #3: They also bolster our data and solutions offerings, as countries want both speed and scale of our data and solutions, and the sovereignty of our satellite services technology.

Speaker #3: Through our AI-enabled solutions, we accelerate time-to-value, become more deeply embedded in our customer operations, and gain more direct visibility into our customers' operational needs.

Will Marshall: Through our AI-enabled solutions, we accelerate time to value, become more deeply embedded in our customer operations, and gain more direct visibility to our customers' operational needs. We're leaning into these synergies across our product offerings. We're continuing to see robust demand from around the world for satellite services driven by the current geopolitical landscape and the demand for sovereign space systems. Our competitive edge here is twofold. Firstly, our proven track record, having launched over 650 Earth imaging satellites, by far the most of any commercial company. Our second is speed. We are able to launch the first satellites within a few months of contract signing, as shown with the partnership funded by Germany, far faster than traditional aerospace.

Speaker #3: We're leaning into these synergies across our product offerings. We're continuing to see robust demand from around the world for satellite services, driven by the current geopolitical landscape and the demand for sovereign space systems.

Speaker #3: Our competitive edge here is twofold. Firstly, our proven track record, having launched over 650 Earth imaging satellites—by far the most of any commercial company.

Speaker #3: Our second is speed. We are able to launch the first satellites within a few months of contract signing, as shown with the partnership funded by Germany—far faster than traditional aerospace.

Speaker #3: The demand is significant and reflected in our pipeline, which has grown appreciably in both number of deals and average deal size since we spoke about this at our Investor Day in October.

Will Marshall: The demand is significant and reflected in our pipeline, which has grown appreciably in both number of deals and average deal size since we spoke about this at our Investor Day in October. We're leaning into this demand by expanding our manufacturing capacity in San Francisco and building out our second manufacturing location in Berlin. On the solutions side, I'm pleased to report that our integration of Bedrock Research is going very well. The team is helping us scale rapidly and deliver AI-based solutions, notably standing up 600 new monitoring sites within 3 hours compared to a weeks-long process when we first launched the service. This deep domain area expertise, paired with our ongoing advancements in AI, have allowed us to expand the number of sites we're monitoring around the world, drastically reduce the time needed to implement, and enable our customers to scale across broader geographic areas.

Speaker #3: We're leaning into this demand by expanding our manufacturing capacity in San Francisco and building out our second manufacturing location in Berlin. On the solutions side, I'm pleased to report that our integration of Bedrock Research is going very well.

Speaker #3: The team is helping us scale rapidly and deliver AI-based solutions, notably standing up 600 new monitoring sites within three hours, compared to a weeks-long process when we first launched the service.

Speaker #3: This deep domain area expertise, paired with our ongoing advancements in AI, has allowed us to expand the number of sites we're monitoring around the world, drastically reduce the time needed to implement, and enable our customers to scale across broader geographic areas.

Speaker #3: During the quarter, Planet expanded its technology collaboration with NVIDIA on multiple fronts. With Planet's proprietary dataset and NVIDIA's compute, we can enable significant new capabilities.

Will Marshall: During the quarter, Planet expanded its technology collaboration with NVIDIA on multiple fronts. With Planet's proprietary dataset and NVIDIA's compute, we can enable significant new capabilities. This includes exploring the use of NVIDIA's accelerated GPU-based computing platform for Planet data processing, enabling faster, more efficient processing for all of our customers. Testing NVIDIA's new Thor processor for in-space use, enhancing super resolution and other AI processing capabilities, and more. As announced earlier this week, we're collaborating to build the world's first scaled GPU native AI engine for satellite data and drive huge advances in efficiency and latency. More generally, we anticipate that AI will be transformational to our business this year. Let me give a bit of broader context. While LLMs offer users the incredible ability to have conversations with the text of the Internet, they know very little about the physical world.

Speaker #3: This includes exploring the use of NVIDIA's accelerated GPU-based computing platform for Planet data processing, enabling faster, more efficient processing for all of our customers.

Speaker #3: Testing NVIDIA's new Thor processor for in-space use, enhancing super resolution and other AI processing capabilities, and more. As announced earlier this week, we're collaborating to build the world's first scaled GPU-native AI engine for satellite data, and drive huge advances in efficiency and latency.

Speaker #3: More generally, we anticipate that AI will be transformational to our business this year. Let me give a bit of broader context. While LLMs offer users the incredible ability to have conversations with the text of the internet, they know very little about the physical world.

Speaker #3: Real-world models need real-world data, and Planet has it. Our deep data archive, averaging over 3,000 collections for every point on the Earth's landmass, represents a treasure trove for indexing the physical world and training next-generation models.

Will Marshall: Real-world models need real-world data, and Planet has it. Our deep data archive, averaging over 3,000 collections for every point on the Earth's landmass, represents a treasure trove of indexing the physical world and training next-generation models. As Wikipedia was the foundation data set for LLMs, we believe that Planet's daily scan is foundational to real-world models. Furthermore, AI itself is commoditizing software development, making data the key differentiation in AI. Why does this matter? Because it has the potential to unlock a huge market. While Planet is currently seeing tremendous traction for AI-based solutions in defense and intelligence, these developments are making broader area monitoring scalable and accessible for other applications and sectors. Ultimately, we believe this will result in generic applications, democratizing access to Earth intelligence and unlocking markets far faster.

Speaker #3: As Wikipedia was the foundational dataset for LLMs, we believe that Planet’s daily scan is foundational to real-world models. Furthermore, AI itself is commoditizing software development, making data the key differentiation in AI.

Speaker #3: And why does this matter? Because it has the potential to unlock a huge market. While Planet is currently seeing tremendous traction for AI-based solutions in defense and intelligence, these developments are making broader area monitoring scalable and accessible for other applications and sectors.

Speaker #3: Ultimately, we believe this will result in generic applications democratizing access to Earth intelligence and unlocking markets far faster. Specifically, we think that more generic AI solutions will soon empower non-technical users to go from a concept to a bespoke application in under an hour.

Will Marshall: Specifically, we think that more generic AI solutions will soon empower non-technical users to go from a concept to a bespoke application in under an hour. We expect expanding these capabilities will benefit our current customers and drive new opportunities in markets such as agriculture, insurance, energy, supply chain, and finance. For the year ahead, our top priorities are executing against our current contracts across both data and solutions and satellite services, and scaling up to capture the massive opportunity before us. We see strong demand, so we're investing into our growth, including the technology roadmap. We're doubling our satellite manufacturing capacity. We're scaling our Pelican fleet with multiple launches scheduled this year. We're launching demos of our Owl and Suncatcher spacecraft, and we're investing in AI for existing solutions and the aforementioned more generic capabilities.

Speaker #3: We expect expanding these capabilities will benefit our current customers and drive new opportunities in markets such as agriculture, insurance, energy, supply chain, and finance.

Speaker #3: For the year ahead, our top priorities are executing against our current contracts across both data and solutions and satellite services, and scaling up to capture the massive opportunity before us.

Speaker #3: We see strong demand, so we're investing into our growth, including the technology roadmap. We're doubling our satellite manufacturing capacity, we're scaling our Pelican fleet with multiple launches scheduled this year, we're launching demos of our Owl and Sun Capsule spacecraft, and we're investing in AI for existing solutions and the aforementioned more generic capabilities.

Speaker #3: In sum, last year we saw the start of returns on our investments into satellite services. This year, we expect to see the start of returns on our investments in AI.

Will Marshall: In sum, last year we saw the start of returns on our investments into satellite services. This year, we expect to see the start of returns into our investments in AI. We sit uniquely at the intersection of space and AI revolutions, and Planet is the first space and AI company. By year's end, we believe Planet's Earth Intelligence platform will deliver transformational global impact as our customers leverage space and AI to transform data into action. We're leaning in to meet the moment and we're playing to win. With that, I'll turn it over to Ashley to discuss our financials. Over to you, Ash.

Speaker #3: We sit uniquely at the intersection of space and AI revolutions, and Planet is the first space and AI company. By year's end, we believe Planet's Earth Intelligence Platform will deliver transformational global impact, as our customers leverage space and AI to transform data into action.

Speaker #3: We're leaning in to meet the moment, and we're playing to win. With that, I'll turn it over to Ashley to discuss our financials. Over to you, Ash.

Speaker #2: Thanks, Will. It was indeed a fantastic year, underpinned by strong execution and key wins in satellite services. I'd like now to cover the results in more detail.

Ashley Johnson: Thanks, Will. It was indeed a fantastic year, underpinned by strong execution and key wins in satellite services. I'd like now to cover the results in more detail. Revenue for Q4 came in at a record $86.8 million, representing approximately 41% year-over-year growth. Full year revenue was $307.7 million, representing approximately 26% year-over-year growth. The outperformance in the quarter was driven primarily by strong usage from our defense and intelligence, and civil government customers, as well as new wins that came in during the quarter. During fiscal 2026, our defense and intelligence sector revenue grew more than 50% year-over-year. The commercial sector was down modestly year-over-year, and the civil government revenue was flat, driven in large part by the end of our contract with Norway for their NICFI program.

Speaker #2: Revenue for the fourth quarter came in at a record $86.8 million, representing approximately 41% year-over-year growth. Full-year revenue was $307.7 million, representing approximately 26% year-over-year growth.

Speaker #2: The outperformance in the quarter was driven primarily by strong usage from our defense and intelligence and civil government customers, as well as new wins that came in during the quarter.

Speaker #2: During fiscal 2026, our defense and intelligence sector revenue grew more than 50% year-on-year. The commercial sector was down modestly year-on-year, and the civil government revenue was flat, driven in large part by the end of our contract with Norway for their NICFI program.

Speaker #2: Turning to our regional revenue breakdown, growth was distributed across the globe in fiscal '26, with approximate revenue growth of 41% year-over-year in Asia-Pacific, 48% in EMEA, 11% in North America, and down about 2% in Latin America.

Ashley Johnson: Turning to our regional revenue breakdown, growth was distributed across the globe in fiscal 2026, with approximate revenue growth of 41% year-over-year in Asia Pacific, 48% in EMEA, 11% in North America, and down about 2% in Latin America. As of the end of fiscal year 2026, our end of period customer count was 897 customers, slightly down on a sequential basis, reflecting our direct sales team's intentional shift to focus on large customer opportunities and leveraging our self-serve platform to provide access to our data for other customers. As a reminder, Planet Insights Platform customers are not included in our end of period customer count. Given our focus on larger customers and the shift to a self-service model for the long tail of the market, we believe this metric has become less useful for investors and is not proactively monitored by management.

Speaker #2: As of the end of fiscal year '26, our end-of-period customer count was 897 customers, slightly down on a sequential basis, reflecting our direct sales team's intentional shift to focus on large customer opportunities and leveraging our self-serve platform to provide access to our data for other customers.

Speaker #2: As a reminder, Planet Insight platform customers are not included in our end-of-period customer count. Given our focus on larger customers and the shift to a self-service model for the long tail of the market, we believe this metric has become less useful for investors and is not proactively monitored by management.

Speaker #2: We believe our retention rates on ACB are far more constructive measures of our business health and opportunity. Therefore, we plan to discontinue this metric beginning with the first quarter of fiscal year '27.

Ashley Johnson: We believe our retention rates on ACB are far more constructive measures of our business health and opportunity. Therefore, we plan to discontinue this metric beginning with Q1 of fiscal year 2027. We continue to see strong revenue growth and thus a solid increase in average revenue per customer as a positive indicator that our sales teams focus on landing and expanding high-value accounts is yielding results. As we shift to some of our ACB metrics, I want to remind you that our satellite services contracts are not included in ACB, although they are included in our RPOs and backlog, which we will discuss in a moment. Recurring ACB was 98% of our end of period ACB book of business, reflecting our continued focus on selling subscription data contracts and solutions as opposed to one-time professional or engineering services.

Speaker #2: We continue to see strong revenue growth and thus a solid increase in average revenue per customer as a positive indicator that our sales team's focus on landing and expanding high-value accounts is yielding results.

Speaker #2: As we shift to some of our ACB metrics, I want to remind you that our satellite services contracts are not included in ACB, although they are included in our RPOs and backlog, which we will discuss in a moment.

Speaker #2: Recurring ACB was 98% of our end-of-period ACB book of business, reflecting our continued focus on selling subscription data contracts and solutions as opposed to one-time professional or engineering services.

Speaker #2: Approximately 85% of our end-of-period ACB book of business consists of annual or multi-year contracts, lower than prior periods as we have seen a higher proportion of large, shorter-termed government contracts signed in recent quarters.

Ashley Johnson: Approximately 85% of our end of period ACB book of business consists of annual or multi-year contracts, lower than prior periods as we have seen a higher proportion of large, shorter-term government contracts signed in recent quarters. Net dollar retention rate at the end of fiscal year 2026 was 116%, and net dollar retention rate with win backs was 118%. Our non-GAAP gross margin for fiscal year 2026 was 59% compared to 60% in fiscal year 2025. For Q4, our non-GAAP gross margin was 57% compared to 65% in Q4 of fiscal year 2025, reflecting investments in support of our satellite services contracts and a mix of contracts, including AI-enabled partner solutions. Our gross margins came in better than expected for the quarter and the year, primarily driven by the revenue outperformance in the quarter.

Speaker #2: Net dollar retention rate at the end of fiscal year '26 was 116%, and net dollar retention rate with winbacks was 118%. Our non-GAAP gross margin for fiscal year '26 was 59%, compared to 60% in fiscal year '25.

Speaker #2: For Q4, our non-GAAP gross margin was 57%, compared to 65% in Q4 of fiscal year '25, reflecting investments in support of our satellite services contracts and the mix of contracts, including AI-enabled partner solutions.

Speaker #2: Our gross margins came in better than expected for the quarter and the year, primarily driven by the revenue outperformance in the quarter. Adjusted EBITDA profit was $15.5 million for fiscal year 2026, better than expected, primarily driven by revenue outperformance and disciplined OPEX spend.

Ashley Johnson: Adjusted EBITDA profit was $15.5 million for fiscal year 2026, better than expected, primarily driven by revenue outperformance and disciplined OpEx spend. Fiscal year 2026 marks our first year of delivering adjusted EBITDA profitability on an annual basis, a milestone we're incredibly proud of. Adjusted EBITDA profit for Q4 was $2.3 million, also better than expected, marking our fifth sequential quarter of adjusted EBITDA profitability. Capital expenditures in FY26, which include our capitalized software development, were approximately $81.5 million. Capital expenditures in Q4 were approximately $23 million. To echo Will's remarks, we're currently in a growth CapEx investment cycle as we lean into market demand, scale up our manufacturing capacity in Berlin, and build out our next generation fleets.

Speaker #2: Fiscal year '26 marks our first year of delivering adjusted EBITDA profitability on an annual basis, a milestone we're incredibly proud of. Adjusted EBITDA profit for Q4 was $2.3 million, also better than expected, marking our fifth sequential quarter of adjusted EBITDA profitability.

Speaker #2: Capital expenditures in FY26, which include our capitalized software development, were approximately $81.5 million. Capital expenditures in Q4 were approximately $23 million. To echo Will's remarks, we're currently in a growth CAPEX investment cycle as we lean into market demand, scale up our manufacturing capacity in Berlin, and build out our next generation fleets.

Speaker #2: Turning to the balance sheet, we ended the year with approximately $640 million of cash, cash equivalents, and short-term investments, an increase of approximately $418 million year-on-year, driven by our issuance of convertible debt and free cash flow profitability.

Ashley Johnson: Turning to the balance sheet, we ended the year with approximately $640 million of cash equivalents, and short-term investments, an increase of approximately $418 million year-on-year, driven by our issuance of convertible debt and free cash flow profitability. In fiscal year 2026, we generated approximately $134.4 million in net cash from operating activities and $52.9 million in free cash flow, representing our first year of achieving positive free cash flow on an annual basis. Our focus remains on managing the business to enable sustainable cash flow generation through efficient growth across our data solutions and satellite services revenue streams.

Speaker #2: In fiscal year 2026, we generated approximately $134.4 million in net cash from operating activities and $52.9 million in free cash flow, representing our first year of achieving positive free cash flow on an annual basis.

Speaker #2: Our focus remains on managing the business to enable sustainable cash flow generation through efficient growth across our data, solutions, and satellite services revenue streams.

Speaker #2: At the end of FY26, our remaining performance obligations, or RPOs, were approximately $852.4 million, up about 106% year-over-year, of which approximately 34% applied to the next 12 months and 65% to the next 24 months.

Ashley Johnson: At the end of FY26, our remaining performance obligations, or RPOs, were approximately $852.4 million, up about 106% year-over-year, of which approximately 34% apply to the next 12 months and 65% to the next 24 months. We estimate our backlog, which includes contracts with the termination for convenience clause, to be approximately $900 million, up approximately 79% year-over-year. Approximately 37% of our backlog applies to the next 12 months and 67% to the next 24 months. Let me now turn to our guidance for Q1 and full fiscal year 2027. In Q1, we're expecting revenue to be between $87 and 91 million, which represents approximately 34% year-over-year growth at the midpoint. We expect non-GAAP gross margin for the quarter to be between 49% and 51%.

Speaker #2: We estimate our backlog, which includes contracts with a termination-for-convenience clause, to be approximately $900 million, up approximately 79% year-over-year. Approximately 37% of our backlog applies to the next 12 months, and 67% to the next 24 months.

Speaker #2: Let me now turn to our guidance for the first quarter and full fiscal year 2027. In Q1, we're expecting revenue to be between $87 and $91 million, which represents approximately 34% year-on-year growth at the midpoint.

Speaker #2: We expect non-GAAP gross margin for the quarter to be between 49% and 51%. The step down is driven by our satellite services contracts, the mix of deals with AI-enabled partner solutions, and investments in our next-generation fleets.

Ashley Johnson: The step-down is driven by our satellite services contracts, the mix of deals with AI-enabled partner solutions, and investments in our next generation fleets. Our range for Adjusted EBITDA in the quarter is expected to be between -$6 million and -$3 million, reflecting our investments to drive sustained growth. We are planning for capital expenditures of approximately $17 to $23 million in the quarter. For the full fiscal year 2027, we expect revenue to be between $415 million and $440 million, representing approximately 39% growth at the midpoint. We believe our backlog provides us with strong visibility to our revenue projections, which is enabling us to raise our growth expectations for the year.

Speaker #2: Our range for adjusted EBITDA on the quarter is expected to be between minus $6 million and minus $3 million, reflecting our investments to drive sustained growth.

Speaker #2: We are planning for capital expenditures of approximately $17 to $23 million in the quarter. For the full fiscal year 2027, we expect revenue to be between $415 and $440 million, representing approximately 39% growth at the midpoint.

Speaker #2: We believe our backlog provides us with strong visibility into our revenue projections, which is enabling us to raise our growth expectations for the year.

Speaker #2: Our non-GAAP gross margin for the year is projected to be between 50% and 52%, in line with our prior expectations and driven by the forecasted mix of business.

Ashley Johnson: Our non-GAAP gross margin for the year is projected to be between 50 and 52%, in line with our prior expectations and driven by the forecasted mix of business. We anticipate margins will expand as we realize returns on our growth investments in subsequent years. We are targeting adjusted EBITDA profit for fiscal 2027 of between breakeven and $10 million, reflecting our desire to maintain EBITDA profitability on an annual basis, even as we continue to invest in our space systems capabilities, AI-powered solutions, and our global sales and marketing organization. We also aim to deliver Rule of 40 for this fiscal year, where Rule of 40 is our revenue growth rate plus adjusted EBITDA margin. We are planning for approximately $80 to 95 million in capital expenditures for the year, reflecting the necessary investments in our next-generation satellites to meet accelerating market demand.

Speaker #2: We anticipate margins will expand as we realize returns on our growth investments in subsequent years. We are targeting adjusted EBITDA profit for fiscal 2027 of between break-even and $10 million, reflecting our desire to maintain EBITDA profitability on an annual basis even as we continue to invest in our space systems capabilities, AI-powered solutions, and our global sales and marketing organization.

Speaker #2: We also aim to deliver Rule of 40 for this fiscal year, where Rule of 40 is our revenue growth rate plus adjusted EBITDA margin.

Speaker #2: We are planning for approximately $80 to $95 million in capital expenditures for the year, reflecting the necessary investments in our next-generation satellites to meet accelerating market demand.

Speaker #2: Even with these operating and capital expenditures, we expect to be free cash flow positive on an annual basis again in fiscal year '27, with a focus on sustaining and expanding free cash flow generation into the future.

Ashley Johnson: Even with these operating and capital expenditures, we expect to be free cash flow positive on an annual basis again in fiscal year 2027, with a focus on sustaining and expanding free cash flow generation into the future. As a reminder, while cash flow can vary quite significantly quarter to quarter based on the timing of cash collections and capital outlays for procurements, our ultimate objective is generating sustainable annual positive cash flow. To close, the incredible momentum we generated in fiscal year 2026 provides us with a strong foundation for the future. Given the strength of our backlog and our robust pipeline, we have significant visibility into our continued revenue growth. As our revenue scales, we anticipate non-GAAP gross margin expansion as well as Rule of 40 for fiscal year 2028 and beyond.

Speaker #2: As a reminder, while cash flow can vary quite significantly quarter to quarter based on the timing of cash collections and capital outlays for procurements, our ultimate objective is generating sustainable annual positive cash flow.

Speaker #2: To close, the incredible momentum we generated in fiscal year 2026 provides us with a strong foundation for the future. Given the strength of our backlog and our robust pipeline, we have significant visibility into our continued revenue growth, and as our revenue scales, we anticipate non-GAAP gross margin expansion as well as Rule of 40 for fiscal year 2028 and beyond.

Speaker #2: This gives us the confidence to invest into the massive market opportunity unfolding in front of us, and as Will mentioned, we are leaning into these trends and playing to win.

Ashley Johnson: This gives us the confidence to invest into the massive market opportunity unfolding in front of us. As Will mentioned, we are leaning into these trends and playing to win. As always, Will and I are incredibly grateful for the outstanding execution, dedication, and teamwork of our Planeteers around the globe. Fiscal 2026 was a standout year because of you, and we're excited for the year ahead. Operator, that concludes our comments. We can now take questions.

Speaker #2: As always, Will and I are incredibly grateful for the outstanding execution, dedication, and teamwork of our Planetaries around the globe. Fiscal 2026 was a standout year because of you, and we're excited for the year ahead.

Speaker #2: Operator, that concludes our comments. We can now take questions.

Speaker #1: Thank you. We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, press star one on your telephone keypad.

Operator: Thank you. We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, press star one on your telephone keypad. If you would like to withdraw your question, press star one again. Pardon me. Your first question comes from the line of Colin Canfield from Cantor. Your line is open. Please go ahead.

Speaker #1: If you would like to withdraw your question, press star one again. Your first question comes from the line of Colin Canfield from Canter. Your line is open.

Speaker #1: Please go ahead.

Speaker #3: Can you perhaps update us on the timing and the scaling of both the Sun Catcher opportunity as well as what sounds like a pretty nascent geointelligence platform with NVIDIA?

Colin Canfield: Can you perhaps update us on the timing and the scaling of both the Suncatcher opportunity as well as what sounds like a pretty nascent geointelligence platform with NVIDIA? Then if you could maybe talk about how much of that was included in the set of opportunities from the investor day. Thank you.

Speaker #3: And then if you could maybe talk about how much of that was included in the set of opportunities from the Investor Day. Thank you.

Speaker #4: Well, both are very exciting opportunities. And in a way, both involve a space component and an AI component. Let me talk about the Google one first, since you brought that up.

Will Marshall: Well, both are very exciting opportunities and in a way, both involve both a space component and an AI component. Let me talk to the Google one first, since you brought that up. Suncatcher is going well. It's early days. Just to recap that project, you know, this is about putting their TPUs into space. It's an early tech demo. That is what we're doing right this second for them. There's a lot of interest in that space that you've seen in recent months. It's very exciting. It's heating up. We're focused on executing towards those research goals, and there's a big potential market there long term. As Sundar put it, I think within 10 years, he expects most compute spending to go into orbit. That's a big amount of money.

Speaker #4: Sun Catcher is going well. It's early days. Just to recap, that project is about putting their TPUs into space. It's an early tech demo—that is what we're doing right this second for them.

Speaker #4: It's a lot of interest in that space that you've seen in recent months. It's very exciting. It's heating up. But we're focused on executing towards those research goals, and there's a big potential market there long term.

Speaker #4: As Sundar put it, I think within 10 years he expects most compute spending to go into orbit. That's a big amount of money. That's a huge, huge market to go after.

Will Marshall: That's a huge market to go after, but we're very early days, so, you know, it's exciting. We're staying focused on executing on those early missions. Then to NVIDIA. Yeah, that is also exciting. It was great to announce that extension of our partnership. It's also a research partnership at this stage. You all know about the fact that we've been putting those NVIDIA GPUs into orbit on our Pelican spacecraft, which is pretty cool. This is actually more focused on the compute on the ground, how we leverage their GPUs in particular to speed up our data pre-processing pipeline. You know, in an increasingly fast-changing world, people want those answers really quickly, and GPUs have the potential to really speed things up.

Speaker #4: But with very early dates, so it's exciting. We're staying focused on executing on those early missions. And then to NVIDIA, yeah, that is also exciting.

Speaker #4: It's great to announce that extension of our partnership. It's also a research partnership at this stage. You all know about the fact that we've been putting those NVIDIA GPUs into orbit on our Pelican spacecraft, which is pretty cool.

Speaker #4: This is actually more focused on the compute on the ground, how we leverage their GPUs in particular to speed up our data processing pipeline.

Speaker #4: In an increasingly fast-changing world, people want those answers really quickly. And GPUs have the potential to really speed things up. We've seen some early results that are very promising, with big speed-ups like 100x on certain parts of our code base. Getting answers to our clients faster is really important.

Will Marshall: We've seen some early results that are very promising, where big speed ups, like 100x on certain parts of our coding base. Getting answers to our clients faster is really important. Research collaboration, they're leaning in and we are leaning in too. It's very exciting. As to the revenue implications, I don't know if you wanted to touch on that, Ashley Johnson.

Speaker #4: So, research collaboration—they're leaning in, and we are leaning in too. It's very exciting. But as to the revenue implications, I don't know if you wanted to touch on that.

Speaker #1: Actually, I mean, I would just remind you that the Sun Catcher partnership is structured as an R&D partnership. So, it's recognized as contra revenue.

Ashley Johnson: I mean, I would just remind you that the Suncatcher partnership is structured as an R&D partnership, so it's recognized as contra revenue. With respect to the NVIDIA partnership, that's really just a research collaboration.

Speaker #1: And with respect to the NVIDIA partnership, that's really just a research collaboration.

Will Marshall: Yes. R&D.

Speaker #4: Yes, R&D.

Speaker #3: Got it, got it. And then as we think about imputing working capital or tailwinds for 2027, is there a right framework to think about it, maybe as like a percentage of the backlog increase, or kind of high-level, what are the building blocks of working capital that we should consider?

Colin Canfield: Got it. As we think about imputing working capital tail or tailwinds for 2027, is there a right framework to think about it? Maybe as like a percentage of the backlog increase or kind of high level, kind of what are the building blocks of working capital that we should consider?

Ashley Johnson: First of all, I just want to correct myself. I made a misstatement on my prior answer. It's not contra revenue, it's contra R&D expense. Thanks for letting me clarify that. As for your second question, in terms of the building blocks for working capital, obviously, as I said, as we are acquiring investments to execute on our backlog. That includes all of the capital expenditures we need to make to build out the Pelicans for our customers. That obviously will weigh into the procurements quarter to quarter. The nice thing about the way these contracts are structured is they typically provide us upfront capital to match the timing of those expenses, at least on an annual basis.

Speaker #1: First of all, I just want to correct myself. I made a misstatement on my prior answer—it's not contra revenue, it's contra R&D expense.

Speaker #1: Thanks for letting me clarify that. As for your second question in terms of the building blocks for working capital, obviously, as I said, as we are acquiring investments to execute on our backlog.

Speaker #1: So, that includes all of the capital expenditures we need to make to build out the Pelicans for our customers. That obviously will weigh into the procurements quarter to quarter.

Speaker #1: The nice thing about the way these contracts are structured is they typically provide us upfront capital to match the timing of those expenses, at least on an annual basis.

Speaker #1: There may be differentials quarter to quarter as to when we make procurements and when we receive milestone payments. So, as I said in the prepared remarks, cash flow is expected to vary quarter to quarter, but on an annualized basis.

Ashley Johnson: There may be differentials quarter to quarter as to when we make procurements and when we receive milestone payments. As I said in the prepared remarks, cash flow is expected to vary quarter to quarter, but on an annualized basis, these contracts really enable us to operate the business in a free cash flow positive way.

Speaker #1: These contracts really enable us to operate the business in a free cash flow positive way.

Speaker #3: Got it. Thank you for the call. Appreciate it.

Edison Yu: Got it. Thank you for the call. Appreciate it.

Colin Canfield: Got it. Thank you for the call. Appreciate it.

Speaker #2: Your next question comes from the line of Ryan Cootes from Needham & Co. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Ryan Koontz from Needham & Company. Your line is open. Please go ahead.

Speaker #3: Great, thanks for the questions and congrats on a great quarter and outlook. Starting with maybe some of the segment—what were your real strengths you saw in Europe in the quarter?

Ryan Koontz: Great. Thanks for the questions and congrats on a great quarter and outlook. Starting with maybe some of the strength you saw in Europe in the quarter, wonder if you can maybe unpack that for us. You know, what were some of the drivers behind that? Obviously a lot of defense work there, but any kind of color you can give us on the European market and how that's been progressing so well for you.

Speaker #3: I wonder if you can maybe unpack that for us. What were some of the drivers behind that? Obviously, a lot of defense work there, but any kind of color you can give us on the European market and how that's been progressing so well for you?

Speaker #4: Yeah, well, maybe I can kick it off. I spent quite a big fraction of the quarter in Europe, going to a number of capitals, speaking to a lot of our customers there.

Will Marshall: Yeah. Well, maybe I can just kick it off. I spent quite a big fraction of the quarter in Europe, going to a number of capitals, speaking to a lot of our customers there. The demand is off the charts. We are leaning into it as best we can, both for our data and AI solutions, and constellation services. We talked about the interest in that going up. Yeah, I mean, it's back to the geopolitical dynamics, right? That's what's underneath this and driving a lot of this demand. They need their own sovereign systems. They need it quickly. They need speed and sovereignty, and we can offer both of those things. Speed, immediate access to our present satellites. Sovereignty, building satellites dedicated for them.

Speaker #4: The demand is off the charts. We are leaning into it as best we can, both for our data and AI solutions, and constellation services.

Speaker #4: We talked about the interest in that going up. Yeah. I mean, it's back to the geopolitical dynamics, right? That's what's underneath this and driving a lot of this demand.

Speaker #4: They need their own sovereign systems. They need it quickly. They need speed and sovereignty. And we can offer both of those things: speed, immediate access to our present satellites; sovereignty, building satellites dedicated for them—and even that we can do very swiftly compared with anyone else.

Will Marshall: Even that we can do very swiftly compared with anyone else. Our history of having launched hundreds of satellites really puts us in a great position to do that. That's the sort of demand signal. Ashley, toward the breakdown, I don't know if you wanna comment at all on that.

Speaker #4: And our history of having launched hundreds of satellites really puts it in a great position to do that. So that's the sort of demand signal, actually, towards the breakdown.

Speaker #4: I don't know if you want to comment at all on that.

Ashley Johnson: We provide the breakdown in the materials. I would just say, you know, we have historically had a very strong presence in Europe, and have a strong team in Berlin foundationally, and we've built on that with acquisitions that have given us presence in the Netherlands as well as in Slovenia. That really helps us when we're engaging with governments across both their civil, defense, and intelligence needs.

Speaker #1: We provide the breakdown and the materials. I would just say we have historically had a very strong presence in Europe, and have a strong team in Berlin, foundationally.

Speaker #1: And we've built on that with acquisitions that have given us presence in the Netherlands as well as in Slovenia. And that really helps us.

Speaker #1: And when we're engaging with governments across both their civil and defense and intelligence needs.

Speaker #4: And if I could just add one final thing: of course, our commitment to building satellites there in Berlin adds to that interest. I mean, we've both needed it for expanded manufacturing for our Pelicans.

Will Marshall: If I could just add one more final thing, of course, our commitment to building satellites there in Berlin adds to that interest. I mean, we both needed it for expanded manufacturing for our Pelicans, and it lent into the European demand because of course that helps connect the dots there.

Speaker #4: And it lent into the European demand because, of course, that helps connect the dots there.

Speaker #3: Sure, that's great. And just any comments around supply chain right now? Is it getting more difficult to acquire the types of key components you need on the supply chain side?

Ryan Koontz: Sure. That's great. Just any comments around supply chain right now? Is it getting more difficult to acquire the types of kind of key components you need on the supply chain side?

Speaker #4: Not really. No, we're not seeing anything material.

Will Marshall: Not really, no. We're not seeing anything material.

Ashley Johnson: Obviously-

Ryan Koontz: Great.

Ashley Johnson: It's something that we track carefully and our teams are always seeking to diversify our supply chain sources.

Speaker #1: Obviously, it's something that we track carefully, and our teams are always seeking to diversify our supply chain sources.

Ryan Koontz: Got it. Thanks so much, guys.

Speaker #3: Got it. Thanks so much, guys.

Ashley Johnson: Thank you.

Will Marshall: No worries.

Speaker #1: Thank you.

Speaker #4: No worries.

Operator: Your next question comes from the line of Edison Yu from Deutsche Bank. Please go ahead.

Speaker #2: Your next question comes from the line of Edison Yu from Deutsche Bank. Please go ahead.

Edison Yu: Thank you very much and congratulations on the quarter. Wanted to come back to the AI element. You talked a little about LLMs. What's the latest, I guess, status on the Anthropic partnership? Have we kind of progressed further from kind of just testing or early testing the models or the training?

Speaker #3: Thank you very much, and congratulations on the quarter. I want to come back to the AI element. You talked a little about LLMs. What's the latest, I guess, status on the Anthropic partnership?

Speaker #3: And have we kind of progressed further from kind of just testing—our early testing of the models or the training?

Will Marshall: Yeah. I mean, in AI in general, as I said, we're moving from this world of LLMs that can tell you about things about the text of the internet to how models are increasingly trying to move towards real world models and real world models needing real world data. Planet has this stack that's necessary. We're doing these research collaborations that we've mentioned, and they're very exciting. What they're really building a foundation towards is, you know, we've been building these bespoke solutions, these what we call AI-enabled solutions for our broad area, PlanetScope daily scan. The maritime domain awareness solution, the global monitoring solution, and the area monitoring solution to civil government.

Speaker #4: Yeah. I mean, AI in general—as I said, we're moving from this world of LLMs that can tell you things about the text of the internet to how models are increasingly trying to move towards real-world models.

Speaker #4: And real-world models needing real-world data. The client has this stack that's necessary. We're doing these research collaborations that we've mentioned, and they're very exciting.

Speaker #4: What they've really been building a foundation towards is we've been building these bespoke solutions, these what we call AI-enabled solutions for our broad area PlanetScope daily scan.

Speaker #4: So the maritime domain awareness solution, the global monitoring solution, and the area monitoring solution for civil government—and those have been really good, and they're starting to take off.

Will Marshall: Those are really good, and they're starting to take off, and that's what's driving a lot of the great growth that you're seeing in the numbers. AI has this potential of making that more generic. That is that anyone can turn up, build their own bespoke application of equivalent fidelity in short order, like maybe within an hour. You know, in a completely bespoke way for their needs. That is just on the horizon. What we're focused on with those research collaborations is how we can build towards that capability. That is what, I mean, what's so exciting about that is the ability to unlock all the potential of our data, especially for commercial and civil government markets, where we've been less focused of late because of the strong interest on the defense and intelligence side.

Speaker #4: And that's what's driving a lot of the great growth that you're seeing in the numbers. But AI has this potential of making that more generic.

Speaker #4: That is, that anyone can turn up, build their own bespoke application of equivalent fidelity in short order—like maybe within an hour—and in a completely bespoke way for their needs.

Speaker #4: That is just on the horizon. And so, what we're focused on with those research collaborations is how we can build towards that capability, and that is what I mean. What's so exciting about that is the ability to unlock all the potential of our data, especially for commercial and civil government markets, where we've been less focused of late because of the strong interest on the defense and intelligence side.

Will Marshall: They are huge markets for Planet. Basically, that's the direction and leaning of those partnerships is enabling us to build out that capability to expand the TAM.

Speaker #4: But our huge markets for Planet. So basically, that's the direction and leaning of those partnerships—enabling us to build out that capability to expand the TAM.

Edison Yu: Absolutely.

Will Marshall: Does that answer the question?

Edison Yu: Just a follow-up on that.

Speaker #3: Absolutely. And just a follow-up on that.

Will Marshall: Yeah.

Edison Yu: Yeah, just a follow-up on that. To get there, what do you see as the biggest? I don't know if you wanna say bottleneck or thing we should look out for. Is it a question of just you need more compute? Is it a question of just-

Speaker #4: Yeah, yeah. Just a follow-up on that to, I guess, get there. What do you see as the biggest—I don't know if you want to say bottleneck—or thing we should look out for?

Speaker #4: Is it a question of just, you need more compute? Is it a question of just, it takes more time, more training? How do you think about the path there, and the bottlenecks?

Will Marshall: Mm.

Edison Yu: You know, it takes time, more training? Like, how do you think about like the path there and the bottlenecks?

Will Marshall: Well, it's complex and evolving in that the space is changing so fast. I mean, literally, we are seeing capabilities that just a couple of months ago we weren't able to do because of the advances in, especially, coding. Like, that makes it now that you can even build whole applications very quickly. We are just seeing that potentially take off much faster than we thought. There's nothing really standing in the way per se. We have the data, that's the critical ingredient, and it's the differentiating ingredient for AI. As I said briefly, like, I mean, in many ways, AI, it's commoditizing more the software layer that's making the AI piece, the data piece most useful for AI.

Speaker #3: Well, it's complex and evolving, in that the space is changing so fast. I mean, literally, we are seeing capabilities that, just a couple of months ago, we weren't able to do because of the advances—in especially coding—like that.

Speaker #3: That means now you can even build whole applications very quickly. So we are just seeing that potentially take off much faster than we thought.

Speaker #3: There's nothing really standing in the way, per se. We have the data—that's the critical ingredient, and it's the differentiating ingredient for AI. And as I said briefly, I mean, in many ways, AI is commoditizing more of the software layer.

Speaker #3: That's making the AI piece—the data piece—most useful for AI, and so that's very differentiating that we have such this unique dataset coming into it.

Will Marshall: You know, that's very differentiating that we have this unique data set coming into it. There's nothing holding us back there, and it's moving very fast. That's why I was saying that I think you're gonna start to see this come to fruition this year. Watch this space.

Speaker #3: So there's nothing holding us back there, and it's moving very fast. And that's why I was saying that I think you're going to start to see this come to fruition this year.

Speaker #3: And so watch this space.

Greg Pendy: Amazing. Thank you.

Speaker #4: Amazing. Thank you.

Operator: Your next question comes from the line of Kristine Liwag from Morgan Stanley. Please go ahead.

Speaker #2: Your next question comes from the line of Christine Leeweg from Morgan Stanley. Please go ahead.

Gabby: Hi, this is Gabby on for Kristine Liwag. Congratulations on the quarter. Just given the recent decision to extend the satellite imagery delay in the Middle East to 14 days as a result of the ongoing conflict, have you seen any changes in customer behavior? Are there any potential contractual implications that we should maybe be aware of?

[Analyst] (Morgan Stanley): Hi, this is Gaby on for Kristine Liwag. Congratulations on the quarter. Just given the recent decision to extend the satellite imagery delay in the Middle East to 14 days as a result of the ongoing conflict, have you seen any changes in customer behavior? Are there any potential contractual implications that we should maybe be aware of?

Speaker #5: Hi, this is Gabby on for Christine. Congratulations on the quarter. Given your recent decision to extend the satellite imagery delay in the Middle East to 14 days as a result of the ongoing conflict, have you seen any changes in customer behavior?

Speaker #5: And are there any potential contractual implications that we should maybe be aware of?

Will Marshall: Yeah. I mean, the short answer is nothing material. Look, what we're focused on there is helping our critical customers in the region do the things they need, which is get critical answers fast, and trying to help them through that. We're focused and mainly heads down on supporting those customers in this critical time as best we can. The delay is a lot to do with the balance of thinking about those operational needs and making sure we don't put people in harm's way, and it's very genuine needs. At the same time, our transparency and accountability mission that we care about and ensuring all of our actors get access eventually. It's a carefully thought through decision, and we're just trying to do our best to help the people that need it.

Speaker #4: Yeah. I mean, the short answer is nothing material. Look, what we're focused on there is helping our critical customers in the region do the things they need, which is get critical answers fast.

Speaker #4: And trying to help them through that, we're focused and mainly heads down on supporting those customers in this critical time as best we can.

Speaker #4: The delay has a lot to do with the balance of thinking about those operational needs and making sure we don't put people in harm's way.

Speaker #4: And it's very genuine needs. At the same time, our transparency and accountability mission that we care about, and ensuring all of our actors get access eventually.

Speaker #4: So it's a careful, carefully thought-through decision, and we're just trying to do our best to help the people that need it.

Gabby: Great. Thank you. Super helpful color. If I could ask a quick follow-up. I mean, you announced the satellite services agreement with Sweden in January. Can you just talk about how you're seeing the pipeline for similar deals progressing relative to what you had laid out at the Investor Day? What are you seeing in terms of conversion timelines and potential scale of upcoming opportunities?

[Analyst] (Morgan Stanley): Great. Thank you. Super helpful color. If I could ask a quick follow-up. I mean, you announced the satellite services agreement with Sweden in January. Can you just talk about how you're seeing the pipeline for similar deals progressing relative to what you had laid out at the Investor Day? What are you seeing in terms of conversion timelines and potential scale of upcoming opportunities?

Speaker #5: Great, thank you. Super helpful, caller. And if I could ask a quick follow-up—I mean, you announced the satellite services agreement with Sweden in January.

Speaker #5: Can you just talk about how you're seeing the pipeline for similar deals progressing, relative to what you had laid out at the Investor Day?

Speaker #5: And what are you seeing in terms of conversion timelines and potential scale of upcoming opportunities?

Will Marshall: Yeah. I mean, as I've mentioned in my prepared remarks, since that October Investor Day, both the number and the average size of those deals has been increasing. I mean, just to give you a sense that it is a strong market demand right now, even stronger than we had said then. You know, it's a bit too early to talk about sort of average deal length because it's just these are very few in number, right? I haven't got any comments to that effect. Overall, the demand is very strong.

Speaker #4: Yeah, I mean, as I've mentioned in my prepared remarks, since that October investor day, both the number and the average size of those deals has been increasing.

Speaker #4: And so, I mean, just to give you a sense that it is a strong market demand right now, even stronger than we had said then.

Speaker #4: And it's a bit too early to talk about, sort of, average deal length because it's just—these are very few in number, right? So I haven't got any comments to that effect.

Speaker #4: But overall, the demand is very strong.

Gabby: Great. Thanks so much.

[Analyst] (Morgan Stanley): Great. Thanks so much.

Speaker #5: Great. Thanks so much.

Operator: Your next question comes from the line of Jeff Van Rhee from Craig-Hallum Capital Group. Please go ahead.

Speaker #2: Your next question comes from the line of Jeff Van Ree from Craig Hallum Capital Group. Please go ahead.

Jeff Van Rhee: Great. Thanks for taking the questions, guys. Congrats, a lot here to love. Let me start first with civil commercial, about 40%, a little less than that of revenues. What do you think, you know, when you look at those markets, obviously DNI is killing it. You've got a lot of sovereign deals flowing through, and it makes sense to be pursuing those deals. I'm wondering how you think about civil and commercial, and what dynamics have to play out for those markets to reaccelerate.

Speaker #6: Great. Thanks for taking the questions, guys, and congrats. A lot here to love. Let me start first with civil commercial—about 40%, a little less than that as a percent of revenues.

Speaker #6: What do you think when you look at those markets? Obviously, D&I is killing it. You've got a lot of sovereign deals flowing through, and it makes sense to be pursuing those deals.

Speaker #6: I'm wondering how you think about civil and commercial, and what dynamics have to play out for those markets to re-accelerate.

Will Marshall: Well, as I said, see earlier answer to Edison about the AI piece, because that's what unlocks these things, and enables it. We're just on the precipice of that. Yeah, I see that beginning to come this year. Just to be clear, in my opinion, the biggest markets are those two segments, not defense and intelligence. We think that is a long and sustaining and really great market. The civil government market is huge. The commercial market is huge. There's so many. It's been lacking those critical solutions. Here we have a generic way of crossing that chasm to the fuller solution that enables us to unlock that market.

Speaker #4: Well, as I said, see the earlier answer to Edison. About the AI piece, because that's what unlocks these things and enables it. And we're just on the precipice of that.

Speaker #4: And so yeah, I see that beginning to come this year. And just to be clear, in my opinion, the biggest markets are those two segments, not defense and intelligence.

Speaker #4: And we think that's a long and sustaining and really great market. But the civil government market is huge; the commercial market is huge.

Speaker #4: There are so many, but it's been lacking those critical solutions. Here, we have a generic way of crossing that chasm to the fuller solution that enables us to unlock that market.

Will Marshall: We know those capabilities that those answers are latent in our data, and this gives the bridge to the actual solution that the customers need. I mean, you know, it's back to my earlier point. AI is gonna enable it, and I think we're gonna see the beginnings of that really take off this year.

Speaker #4: And so we know those capabilities, that those answers are latent in our data. And this gives the bridge to the actual solution that the customers need.

Speaker #4: So, I mean, it's back to my earlier point. AI is going to enable it, and I think we're going to see the beginnings of that really take off this year.

Jeff Van Rhee: Yeah. Over to the sovereign deals for a second. I mean, obviously, three mega deals here, roughly trailing twelve months, give or take. You know-

Speaker #6: Yeah. And over to the sovereign deals for a second. I mean, obviously, what – three mega deals here, roughly trailing twelve months, give or take. It sounds like the pipeline has expanded.

Will Marshall: Yeah.

Jeff Van Rhee: It sounds like the pipeline is expanded. Sounds like you're thinking, you know, deal count there should improve. I mean, just any other observations on those sovereign deals, on the magnitude of the growth in the pipeline? Sounds like it really accelerated even further, potentially in the last 90 days.

Speaker #6: It sounds like you're thinking deal count there should improve. I mean, just any other observations on those sovereign deals, on the magnitude of the growth in the pipeline—it sounds like it really accelerated even further, potentially, in the last 90 days.

Will Marshall: No, I didn't want to quantify that, but just give you a sense that it is really growing and it's very strong. Yeah, that's it.

Speaker #4: No, I didn't want to quantify that, but just to give you a sense that it is really growing and is very strong. And yeah, that's it.

Ashley Johnson: The only other thing that I would add, Jeff, which I think is an important point, is that when we are selling these sovereign capabilities, we are coupling with that our data and solutions. It actually is the synergies across that that is a competitive differentiator because we can drive value to these customers out of the gate. We can give them visibility and intelligence that they didn't have before as we work with them over the longer term contract to build out what their sovereign capabilities will ultimately be. It's worth pointing out that actually a lot of our backlog growth is in data and solutions. In fact, that part of the backlog has almost doubled year over year.

Speaker #2: And the only other thing that I would add, Jeff, which I think is an important point, is that when we are selling these sovereign capabilities, we are coupling with that our data and solutions.

Speaker #2: And it actually is the synergy—synergy is across that—that is a competitive differentiator, because we can drive value to these customers out of the gate.

Speaker #2: We can give them visibility and intelligence that they didn't have before, as we work with them over the longer-term contract to build out what their sovereign capabilities will ultimately be.

Speaker #2: And so, it's worth pointing out that actually a lot of our backlog growth is in Data and Solutions. In fact, that part of the backlog has almost doubled year over year.

Jeff Van Rhee: Oh, that's great color. Last one, if I could, just on the Owl. Any updates there that you could share?

Speaker #6: Wow, that's great color. Last one, if I could, just on the owls—any updates there that you could share?

Will Marshall: Yeah, I mean, we're building that tech demo as we announced last year towards that improved daily scan capability. The team's working hard on it. It's going well. It's quite an incredible capability that we're obviously building there. Just remind everyone that we're moving towards 1-meter scan rather than 3-meter, and that's roughly 10 times more data per unit area of the ground and roughly a 10X improvement in latency as well, because they will be equipped with both onboard compute systems as well as satellite telecoms so that we can get the data back as well. Those things are all gonna be faster as well. Much lower latency of 10X there too. It's really a significant improvement on that system. Yeah, we're looking forward to launching a demo.

Speaker #4: Yeah, I mean, we're building that tech demo, as we announced last year, towards that improved daily scan capability. The team's working hard on it.

Speaker #4: It's going well. It's quite an incredible capability that we're obviously building there. Just remind everyone that we're moving towards one-meter scan rather than three-meter.

Speaker #4: And that’s roughly 10 times more data per unit area of the ground, and roughly a 10x improvement in latency as well, because they will be equipped with both onboard compute systems as well as satellite comms, so that we can get the data back as well.

Speaker #4: So those things are all going to be faster as well. So much lower latency—a 10x there, too. So it's really a significant improvement on that system.

Speaker #4: And yeah, we're looking forward to launching a demo.

Jeff Van Rhee: Sounds great. Thanks, guys.

Ashley Johnson: Thanks, Jeff.

Speaker #6: Sounds great. Thanks, guys.

Operator: Your next question comes from the line of Jason Gursky from Citi. Please go ahead.

Speaker #2: Thanks, Jeff. Your next question comes from the line of John Goodin from Citibank. Please go ahead.

Jason Gursky: Hey, guys. Thanks for taking my question. Really appreciate it. I just wanted to square off the backlog strength and all of the positive commentary with revenue guidance. The revenue guidance is fantastic, don't get me wrong. But even so, it just seems like there's upside to it based on the commentary of, you know, incredibly strong demand signals, particularly in Europe, as well as the fact that as a percentage of the backlog that you guys have right now, it doesn't seem like the revenue guide is particularly large percentage versus maybe how you've set guidance in the past.

Speaker #7: Hey, guys. Thanks for taking my question, really appreciate it. I just wanted to square off the backlog strength and all of the positive commentary with revenue guidance.

Speaker #7: The revenue guidance is fantastic, don't get me wrong. But even so, it just seems like there's upside to it based on the commentary of incredibly strong demand signals, particularly in Europe, as well as the fact that, as a percentage of the backlog that you guys have right now, it doesn't seem like the revenue guide is a particularly large percentage versus maybe how you've set guidance in the past.

Ashley Johnson: Yeah, it's obviously a good question, John. We're in a really favorable position right now in terms of the level of visibility that we have. Obviously, there's a lot of execution that goes into turning backlog into revenue, and we are laser focused on that. And in terms of setting guidance, I think what you've seen from us, particularly in recent periods, is we try to give ourselves room for the fact that, you know, on these big mission-critical types of transactions and contracts, there are things that can shift from quarter to quarter, and we wanna give room in our guidance for that to happen so that we can keep our customers, you know, front and center, around execution.

Speaker #5: Yeah, it's obviously a good question, John. We're in a really favorable position right now, in terms of the level of visibility that we have.

Speaker #5: Obviously, there's a lot of execution that goes into turning backlog into revenue, and we are laser-focused on that. And in terms of setting guidance, I think what you've seen from us, particularly in recent periods, is we try to give ourselves room for the fact that on these big, mission-critical types of transactions and contracts, there are things that can shift from quarter to quarter.

Speaker #5: And we want to give room in our guidance for that to happen, so that we can keep our customers front and center around execution.

Ashley Johnson: Similarly, we have a great pipeline of opportunity, but when those deals land, given how big they can be, can really impact revenue in the year. We tend to assume that new signings are back half loaded, which give us opportunity to deliver upside if that doesn't end up being the case, if it ends up landing sooner. Doesn't put us in a position where we're out over our skis in terms of the numbers we've given you.

Speaker #5: Similarly, we have a great pipeline of opportunity, but when those deals land, given how big they can be, they can really impact revenue in the year.

Speaker #5: And so we tend to assume that new signings are back half-loaded, which gives us opportunity to deliver upside if that doesn't end up being the case.

Speaker #5: If it ends up landing sooner, but doesn't put us in a position where we're out over our skis in terms of the numbers we've given you.

Jason Gursky: Okay, that makes a lot of sense. It sounds like, you know, that there are some layers of conservatism in there which is appropriate, and we'll see how that plays out throughout the year. If I could ask one more. Just in terms of the activities in the Middle East, the conflict there, do you feel that has additionally kind of turbocharged the demand for your product in any way? I know the backdrop is strong, but has it had an obvious impact, you know, as sort of a recent event?

Speaker #7: Okay, that makes a lot of sense. It sounds like there are some layers of conservatism in there, which is appropriate, and we'll see how that plays out throughout the year.

Speaker #7: If I could ask one more, just in terms of the activities in the Middle East, the conflict there, do you feel that that has additionally kind of turbocharged the demand for your product in any way?

Speaker #7: I know the backdrop is strong, but has that had an obvious impact as sort of a recent event?

Will Marshall: Well, obviously there's a huge amount of focus in that, but again, as I said earlier, we're just focused on delivering pieces. We're doing mission critical things. We're trying to focus on that. We'll see. It's early days.

Speaker #4: Well, obviously, there's a huge amount of focus in that. And we are, but again, as I said earlier, we're just focused on delivering because we're doing mission-critical things.

Speaker #4: We're trying to focus on that, but we'll see. It's early days.

Ashley Johnson: Yeah, I think, you know, one of the things that we have seen in these types of situations is you do see an increase in usage as there's just more urgency in getting as much data as possible around the situation. You know, ultimately, as Will said, situations like this can be very dynamic.

Speaker #5: Yeah, I think one of the things that we have seen in these types of situations is you do see an increase in usage, as there's just more urgency in getting as much data as possible around the situation. But ultimately, as Will said, situations like this can be very dynamic.

Jason Gursky: Got it. Thank you.

Speaker #7: Got it. Thank you.

Operator: Your next question comes from the line of Trevor Walsh from Citizens. Please go ahead.

Speaker #2: Your next question comes from the line of Trevor Walsh from Citizens. Please go ahead.

Trevor Walsh: Great. Hey, all. Thanks for taking my questions. Will, you called out the SHIELD IDIQ in your prepared remarks. Can you maybe just give us a sense? I know early days on this, very large project and a lot of it's sensitive, but can you give us a sense of how you're thinking about that opportunity? Is that something where it's just kind of bread and butter Planet Labs Earth observation data that you would be providing for that as you go after contracts and opportunities there? Or might it even look like something more of akin to satellite services where you might even just building spacecraft that are fairly non-traditional for you guys, but just being used for all the things that are part of that project?

Speaker #8: Great. Hey, all. Thanks for taking my questions. Will you call out the Shield IDIQ in your prepared remarks? Can you maybe just give us a sense?

Speaker #8: I know it's early days on this very large project, and a lot of it's sensitive, but can you give us a sense of how you're thinking about that opportunity?

Speaker #8: Is that something where it's just kind of bread and butter, Planet Labs, earth observation data that you would be providing for that as you go after contracts and opportunities there?

Speaker #8: Or might it even look like something more akin to satellite services, where you might even just be building spacecraft that are fairly non-traditional for you guys, but just being used for all the things that are part of that project?

Will Marshall: Well, yeah, as you say, it's early days. There's obviously a big opportunity. There's, you know, huge budget behind it. The specific ways in which we fit in will have to be figured out as we understand the architecture, and they're still working on many of those aspects. There are, of course, ways in which our present data sets could fit into that. Early warning of certain things, strategic analysis across the board areas. That obviously makes sense. Right now, that is merely a vehicle, and then we'll compete on awards within that, and that's the same for all the people that have got awards under that system. Yeah. Obviously finding unknown unknowns, you know, there could be specific missions, but it's very early days to be thinking about that.

Speaker #4: Well, yeah. As you say, it's early days. There's obviously a big opportunity. There's huge budget behind it. But specific ways in which we fit in will have to be figured out as we understand the architecture.

Speaker #4: And they're still working on many of those aspects. There are, of course, ways in which our present data sets could fit into that—early warning of certain things, strategic analysis, of course, broad areas.

Speaker #4: That obviously makes sense. But right now, that is merely a vehicle, and when we compete on awards within that, it’s the same for all the people that have got awards under that system.

Speaker #4: So, yeah. But obviously, finding unknown unknowns—there could be specific missions, but it's very early days to be thinking about that. What I will say is that we're continuing to lean into specific opportunities that are very live right now, like with Luno, with our Navy customers, and others.

Will Marshall: What I will say is that we're continuing to lean into specific opportunities that are very live right now, like in with Luno, with our Navy customers and others. You know, we're seeing a lot of interest in comms around the world. You know, the department has a lot of interest across the board and we're leaning into it.

Speaker #4: So we're seeing a lot of interest in COCOMs around the world. So the Department has a lot of interest across the board, and we're leaning into it.

Michael Latimore: Great. Awesome. Appreciate that. Ashley, maybe just one follow-up for you. I appreciate the color you gave around free cash flow. I know you guys aren't giving an official guide, but just given how strong you guys ended this current fiscal year, and as we think about 2027, there can be a bit of a step-down from just going from $50 million to something that's just generally positive. Just wanna make sure we don't get. Just given the CapEx spend and everything else, could you just give us a little bit of maybe guardrails as to how we think about that for 2027? That would be, that'd be great.

Trevor Walsh: Great. Awesome. Appreciate that. Ashley, maybe just one follow-up for you. I appreciate the color you gave around free cash flow. I know you guys aren't giving an official guide, but just given how strong you guys ended this current fiscal year, and as we think about 2027, there can be a bit of a step-down from just going from $50 million to something that's just generally positive. Just wanna make sure we don't get. Just given the CapEx spend and everything else, could you just give us a little bit of maybe guardrails as to how we think about that for 2027? That would be, that'd be great.

Speaker #8: Great. Awesome. Appreciate that. Ashley, maybe just one follow-up for you. I appreciate the color you gave around free cash flow. I know you guys aren't giving an official guide, but just given how strong you guys ended this current fiscal year and as we think about '27, there's kind of a there's obviously a there can be a bit of a step down from just going from 50 million to something that's just generally positive.

Speaker #8: So just want to make sure we don't get just given the CapEx spend and everything else. If you could just give us a little bit of, maybe, guardrails as to how we think about that for '27, that would be great.

Ashley Johnson: Yeah. I mean, first, I'll just reiterate the point that I made. We definitely expect there to be pretty significant fluctuations quarter to quarter. Just like I said, timing of procurement versus timing of milestone payments can cause, you know, one quarter to be much more positive and another quarter to be, you know, significantly negative. That's one caution that I provide. That makes it a little bit harder to give, you know, very precise guidance around it, which is why I haven't. To your point, you know, depending on, you know, how much more of this opportunity we continue to realize, it would not make sense for us to optimize expanding free cash flow on the year versus setting ourselves up to both deliver against the contracts we have and to bring more on.

Speaker #2: Yeah. I mean, first, I'll just reiterate the point that I made. We definitely expect there to be pretty significant fluctuations quarter to quarter. Just like I said, the timing of procurement versus the timing of milestone payments can cause one quarter to be much more positive and another quarter to be significantly negative.

Speaker #2: So that's one caution that I provide, and that makes it a little bit harder to give very precise guidance around it, which is why I haven't.

Speaker #2: And to your point, depending on how much more of this opportunity we continue to realize, it would not make sense for us to optimize expanding free cash flow on the year versus setting ourselves up to both deliver against the contracts we have, and to bring more on.

Ashley Johnson: If that offers enough color to you without giving specific guidance, which I'm really not in a position to do, we're not focused on, you know, kind of, sustaining or expanding free cash flow from last year, but really focused on

Speaker #2: So if that offers enough color to you, without giving specific guidance—which I'm really not in a position to do—we're not focused on kind of sustaining or expanding free cash flow from last year, but really focused on balancing it quarter to quarter and leaning into the market.

Michael Latimore: Great

Ashley Johnson: ...balancing it quarter-over-quarter and leaning into the market.

Trevor Walsh: Great

Ashley Johnson: ...balancing it quarter-over-quarter and leaning into the market.

Michael Latimore: That makes sense. That's helpful. Thanks, Ashley.

Trevor Walsh: That makes sense. That's helpful. Thanks, Ashley.

Speaker #8: That makes sense. That's helpful. Thanks, Ashley.

Ashley Johnson: Yeah, thank you.

Operator: Your next question comes from the line of Greg Pendy from Clear Street. Please go ahead.

Speaker #2: No, thank you. Your next question comes from the line of Greg Pendy from ClearStreet. Please go ahead.

Greg Pendy: Hey, guys. Thanks for taking my question. Just one quick one, just so that I understand kind of the approach on this year of leaning in in terms of the commercial and civil side. I mean, it's hard to think back, but you know, you did have a cost rationalization program at one time, and your sales and marketing is down around 15% from fiscal 2024, yet your revenues are up roughly 40%. Is it kind of that the customers through Anthropic will figure out how to use the data and how valuable it is into their daily workflows? Or do you think that, you know, you'll need some boots on the ground to educate the civil and commercial markets? Thanks.

Speaker #7: Hey, guys. Thanks for taking my question. Just one quick one, just so that I understand kind of the approach on this year of leaning in in terms of the commercial and civil side.

Speaker #7: I mean, it's hard to think back, but you did have a cost rationalization program at one time. And your sales and marketing is down around 15% from fiscal 2024.

Speaker #7: Yet your revenues are up roughly 40%. So, is it kind of that the customers through Anthropic will figure out how to use the data and how valuable it is in their daily workflows, or do you think that you'll need some boots on the ground to educate the civil and commercial markets?

Ashley Johnson: Yeah. Greg, it's a very good call-out. We did, you know, realign the team across the board to really focus on where we had the largest account opportunities, which I think did disproportionately impact, you know, how much resource we were putting behind going after a more distributed commercial market. As we said, we were building out the platform to enable smaller customers to really access the data on a self-serve basis. I think as we are growing those markets and leaning into the AI that Will highlighted, we will be making some targeted investments in those markets where we're seeing the most traction out of the gate. We do have feet on the street going and meeting with customers and demonstrating for them.

Speaker #7: Thanks.

Speaker #5: Yeah, Greg, it's a very good callout. We did realign the team across the board to really focus on where we had the largest account opportunities.

Speaker #5: Which I think did disproportionately impact how much resource we were putting behind going after a more distributed commercial market. And as we said, we were building out the platform to enable smaller customers to really access the data on a self-serve basis.

Speaker #5: I think as we are growing those markets, and leaning into the AI that will highlight it, we will be making some targeted investments in those markets where we're seeing the most traction out of the gate.

Speaker #5: So, we do have feet on the street going and meeting with customers and demonstrating for them, and that is a really exciting part of these new capabilities that we have, is we can really show, not tell, in these customer meetings.

Ashley Johnson: That is a really exciting part of these new capabilities that we have, is we can really show, not tell in these customer meetings, all the insights you can extract from the data to answer their specific questions. We did a lot of training with our sales team earlier this year, really showing them how to use these tools in demo environments. Obviously, the world has changed a lot in the last six years. You can do a lot of that without putting people on airplanes. But it will require some investments across sales and marketing, and I did highlight that as one of the investment areas for us this year.

Speaker #5: All the things that you can—all the insights you can extract from the data—to answer their specific questions. So we did a lot of training with our sales team earlier this year, really showing them how to use these tools and demo environments.

Speaker #5: Obviously, the world has changed a lot in the last six years. You can do a lot of that without putting people on airplanes. But it will require some investments across sales and marketing.

Speaker #5: And I did highlight that as one of the investment areas for us this year.

Greg Pendy: That's very helpful. Thanks a lot.

Speaker #7: That's very helpful. Thanks a lot.

Operator: Your next question comes from the line of Michael Latimore from Northland. Please go ahead.

Speaker #2: Your next question comes from the line of Alex Lattimore from Northland. Please go ahead.

Michael Latimore: Hey, guys. Excellent quarter. Michael Latimore on here for Mike Latimore. I had one question. I just wanted to hit on guidance one more time. Good raise on guidance. I was wondering if you could talk about what assumptions are factored into that raise on guidance. Does this assume any new eight-plus figure wins or any commentary there?

Speaker #6: Hey, guys. Excellent quarter. Alex Lattimore on here for Mike Lattimore. I had one question. I just wanted to hit on guidance one more time.

Speaker #6: Good raise on guidance. I was wondering if you could talk about what assumptions are factored into that raise on guidance. Does this assume any new 8-plus-figure wins or any commentary there?

Ashley Johnson: Yes. Thanks, Alex. I'd say we're very balanced in terms of how we think about those types of opportunities that may be in our pipeline, because obviously those could swing outcomes, based on whether they come in or not. Typically, what we'll look at is a pipeline of opportunity where if an eight-figure deal were to fall out of the pipeline, what type of backup we have for that opportunity, and then probability adjust it. We are definitely looking at active opportunities probabilities, and then giving ourselves room for those deals where maybe we don't have enough pipeline to make up for, that one landing on time or in the year, which gives us opportunity to outperform. Like I said earlier, it doesn't put us in a position where we feel over our skis.

Speaker #5: Yes, thanks, Alex. I'd say we're very balanced in terms of how we think about those types of opportunities that may be in our pipeline, because obviously those could swing outcomes based on whether they come in or not.

Speaker #5: So typically, what we'll look at is a pipeline of opportunity where if an eight-figure deal were to fall out of the pipeline, what type of backup we have for that opportunity, and then probability-adjust it.

Speaker #5: So we are definitely looking at active opportunities probabilities, and then giving ourselves room for those deals where maybe we don't have enough pipeline to make up for that one landing on time or in the year.

Speaker #5: Which gives us opportunity to outperform and, like I said earlier, doesn't put us in a position where we feel over our skis.

Michael Latimore: Awesome. One more. I just wanted to hear if there's any footholds in the Golden Dome initiative. I understand there was a $10 billion incremental add to the Golden Dome initiative for space-based capabilities. I'm not sure if you're seeing any demand there for Planet systems. Any commentary around Golden Dome would be helpful.

Speaker #6: Awesome. And then one more. I just wanted to hear if there's any footholds in the Golden Dome Initiative. I understand there was a $10 billion incremental add to the Golden Dome Initiative for space-based capabilities.

Speaker #6: I'm not sure if you're seeing any demand there for Planet systems. But any commentary around Golden Dome would be helpful.

Will Marshall: Yeah. I sort of said all that that I can on that at the minute. It's very early days as they're architecting that system. That's the SHIELD IDIQ, just to be clear, is the Golden Dome. That answer was about that. It's a framework that we have, and now we will bid for actual awards under that program. We don't know what they are exactly yet, and when we do, we will respond. Per my earlier answer, the general thing is giving domain awareness, and other things that could be useful for that. We obviously have to wait and see what comes through that.

Speaker #7: Yeah. I sort of said, oh, I can't on that at the minute. It's very early days as they're architecting that system, and there's potentially the Shield IDIQ. Just to be clear, the Shield IDIQ is the golden dome.

Speaker #7: And so that answer was about that. And again, it's a framework that we have, and now we will bid for actual awards under that program.

Speaker #7: So, but we don't know what they are exactly yet. And when we do, we will respond. But per my earlier answer, the general thing is giving domain awareness and other things that could be useful for that.

Speaker #7: So, but we obviously have to wait and see what comes through that.

Colin Canfield: Awesome. Excellent quarter. Thanks, guys.

Michael Latimore: Awesome. Excellent quarter. Thanks, guys.

Speaker #6: Awesome. Excellent quarter. Thanks, guys.

Operator: Thank you. Your next question comes from the line of Caleb Henry from Quilty Space. Please go ahead.

Speaker #5: Thank you.

Speaker #2: Your next question comes from the line of Caleb Henry from Quilty Space. Please go ahead.

Caleb Henry: Hi, guys. Thanks for the call. Couple of questions on the satellite manufacturing. Actually, first one, sorry, on Pelican. I've noticed that you guys lowered one of the Pelican satellites a little past 400km recently. Is that part of a larger fleet migration to a very low Earth orbit, or is there another way that we should think about that?

Speaker #8: Hi, guys. Thanks for the call. A couple of questions on satellite manufacturing. Actually, the first one—sorry—on Pelican. I've noticed that you guys lowered one of the Pelican satellites a little past 400 kilometers recently.

Speaker #8: Is that part of a larger fleet migration to a very low Earth orbit? Or is there another way that we should think about that?

Will Marshall: Yeah. We lower spacecraft, of course, to the operational altitudes. Pelican, part of the reason we call it Pelican was to fly low. Pelicans fly low to the water, and so we were sort of mimicking that when we were talking about this. They have ion engines such that they can fly really low. In time, that is part of the process that gets us to the 30-centimeter ultimate resolution target for those missions. No changes to the plan. Those were just operational adjustments as we will start always with the satellites in a slightly higher orbit and bring them down to operational orbits as we progress. By the way, you may just on Pelican, you may wanna look in the associated deck with this earnings.

Speaker #7: Yeah. We lower spacecraft, of course, to the operational altitudes, and Pelican—part of the reason we call it Pelican was to fly low. Pelicans fly low to the water, and so we were sort of mimicking that when we were talking about this. And they have ion engines such that they can fly really low.

Speaker #7: And in time, that is part of the process that gets us to the 30-centimeter ultimate resolution target for those missions. But no changes to the plan.

Speaker #7: Those were just operational adjustments, as we will start always with the satellites in a slightly higher orbit and bring them down to operational orbits.

Speaker #7: As we progress—and by the way, just on Pelicans—you may want to look in the associated deck with this earnings. There's a few really cool pictures of some of the fast response timelines that we had.

Will Marshall: There's a few really cool pictures of some of the fast response timelines that we had three pictures about a year. It's very exciting to see-

Caleb Henry: About an hour.

Speaker #7: Three pictures about a year. It's very exciting to see, and not yet. In about an hour. And just other great performance of that system.

Will Marshall: In an hour. Not yet. In about an hour. Just other great performance of that system, so it's very exciting as. We've got multiple launches for more of those systems going up this year, so it's exciting times. Was there a broader question about the manufacturing?

Speaker #7: So it's very exciting, and we've got multiple launches for more of those systems going up this year. So, exciting times. And was there a broader question about the manufacturing?

Caleb Henry: Yeah. I definitely kinda looked through those pictures. Looking at the contract for Sweden and tying that into manufacturing, is that, can you give a sense of when those satellites are supposed to be delivered and how many satellites? Is that sort of the reason for the ramp-up in manufacturing space in California?

Speaker #8: Yeah, I definitely kind of looked through this picture, but looking at the contract for Sweden and tying that into manufacturing, can you give a sense of when those satellites are supposed to be delivered and how many satellites?

Speaker #8: Is that sort of the reason for the ramp-up in manufacturing space in California?

Will Marshall: Nothing specific I gotta say specifically to that customer, but we're ramping up because of the demand overall, right? We're building fleets for multiple customers as well as for our own system. That demand is obviously already clear such that we're expanding here in San Francisco and in Berlin.

Speaker #7: Nothing specific. I'm going to say, specifically to that customer. But we're ramping up because of the demand overall, right? And we're building fleets for multiple customers, as well as for our own system.

Speaker #7: And that demand is obviously already clear, such that we're expanding here in San Francisco and in Berlin.

Caleb Henry: Okay. Last question. I was just curious if you could shed more light on what makes 2026 the year you first anticipate seeing a return on investment on AI. Was there more of an aha moment that happened, or is this just the natural evolution of the years of investment and how customers use Planet data?

Speaker #8: Okay. And then, last question—just curious if you could shed more light on what makes 2026 the year you first anticipate seeing a return on investment on AI.

Speaker #8: Was there more of an 'aha' moment that happened, or is this just a natural evolution of years of investment and how customers use Planet data?

Will Marshall: Yeah. That's an oversimplification because, I mean, we've had revenue from AI a fair bit before. What I meant is in terms of the big way in which AI can unleash those other market potential, and I think we're gonna really start to see those generic solutions that I mentioned, ways in which anyone can turn up, build a application, that's relevant to their needs and then start getting value. That unlocks other markets that we've been talking about for years, latent in our data, agriculture, energy, insurance, finance, so on. I think that it's just more that I see that all the pieces are coming together such that that will come to fruition this year, and you will start to really see that take off.

Speaker #7: Yeah. And that's an oversimplification because, I mean, we've had revenue from AI a fair bit before. What I mean is, in terms of the big way in which AI can unleash those other market potentials.

Speaker #7: And I think we're going to really start to see those generic solutions that I mentioned—ways in which anyone can turn up, build an application that's relevant to their needs, and then start getting value.

Speaker #7: That unlocks the markets that we've been talking about for years that are late in our data—agriculture, energy, insurance, finance, and so on. And so I think that it's just more that I see that all the pieces are coming together such that that will come to fruition this year, and you will start to really see that take off.

Will Marshall: Just like, you know, the constellation service or satellite services really started to take off in FY 2026.

Speaker #7: Just like the constellation service or satellite services really started to take off in FY26.

Operator: Thank you. That's all the time we have for questions today. I will now turn the call back to Will Marshall, CEO and co-founder, for closing remarks.

Speaker #2: Thank you. That's all the time we have for questions today. I will now turn the call back to Will Marshall, CEO and co-founder, for closing remarks.

Will Marshall: Well, I'll just say that, obviously it's great to see the business doing great, both in the satellite services and in the AI powered solutions side. We're very proud of the financials that we reported today, not just the beating the revenue expectations, but I'm especially proud of the backlog improvement to $900 million and achieving the Rule of 40 again in a quarter. It really has set us up for a strong foundation for this coming year. Given that backlog and confidence in our pipeline, we've projected, you know, quite strong growth again for this year, and that's why, and even for years that follow, which is why we're investing this year strongly into that market opportunity.

Speaker #7: Well, I have to say that, obviously, it's great to see the business doing great both in the satellite services and in the AI-powered solutions side.

Speaker #7: And we're very proud of the financials that we reported today. Not just beating the revenue expectations, but I'm especially proud of the backlog improvement to $900 million and achieving the rule of 40 again in the quarter.

Speaker #7: And it really has set us up for a strong foundation for this coming year. And given that backlog and confidence in our pipeline, we've projected quite strong growth again for this year.

Speaker #7: And that's why, and even for years that follow, which is why we're investing this year strongly into that market opportunity. And like I was just saying, this is the year for AI for Planet.

Will Marshall: Like I was just saying, this is the year for AI, for Planet. I think this bridge of the solutions gap will unleash a huge opportunity latent in Planet's data. I just wanna end by thanking our teams, as we started, around the globe that have enabled all of this to be possible. Thanks again for joining, everyone.

Speaker #7: And I think this bridge to the solutions gap will unleash a huge opportunity later in Planet's data. I just want to end by thanking our teams as we started.

Speaker #7: Around the globe that have enabled all of this to be possible. Thanks again for joining, everyone.

Operator: This concludes today's call. Thank you all for attending. You may now disconnect.

Q4 2026 Planet Labs PBC Earnings Call

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