Rocket Lab lands $190M contract with US Defense Department

Rocket Lab Corporation (RKLB) announced that it has secured a $190-million contract from the US Department of Defense (also known as the Department of War) to perform 20 hypersonic test flights with its HASTE launch vehicle.

The company noted that it is the largest contract it has ever been awarded.

The test flights will be launched as part of the Defense Department's Test Resource Management Center (TRMC) Multi-Service Advanced Capability Hypersonic Test Bed (MACH-TB) 2.0 program.

This is a $1.45 billion, five-year program led by TRMC and the Naval Surface Warfare Center Crane Division (NSWC Crane) to accelerate hypersonic flight tests and advance aerospace technologies through affordable, rapid and reusable flight testing. Approximately 50 flight tests are expected to be conducted annually.

Rocket Lab is slated to perform 20 hypersonic flight tests with its HASTE launch vehicle over a four-year period. The flights will happen under the MACH-TB 2.0 Task Area 1, which is led by Kratos Defense & Security Solutions, Inc. (KTOS).

The company noted that the first of its missions will take place within months of signing the contract, which it said proves its "operational efficiency and ability to move quickly to meet modern warfare demands."

According to Rocket Lab, it has already conducted multiple successful HASTE launches at speeds of Mach 5+ for the MACH-TB program since 2023. It said that the "expanded multi-year launch partnership builds upon Rocket Lab’s demonstrated success delivering high-cadence hypersonic capabilities at scale for the warfighter."

The 20 hypersonic test flights now pushes the total number of launches in its backlog up to 70, creating more than $2 billion across both launch and space systems, the company added.

“Our expanded partnership with MACH-TB and the Department of War strengthens America’s national security and delivers reliable, modern hypersonic capabilities with speed and affordability," Rocket Lab founder and CEO Sir Peter Beck said in a statement.

"Our advanced technology, responsive launch schedules, and mass production of our HASTE hypersonic rockets are enabling faster progress across a range of hypersonic experiments by our government and industry partners, and this latest contract is another proud moment for the team that builds the strength and resiliency of the United States’ aerospace efforts.”

Analyst sees Rocket Lab competing with SpaceX

Rocket Lab recently suffered a setback when it said earlier this month that it was pushing back the highly anticipated launch of its Neutron rocket, with the mission now estimated to happen in the fourth quarter.

The company had initially planned to launch its Neutron rocket at some point in 2025, but kept delaying it due to further testing on the aircraft.

Rocket Lab announced in January that the rocket had suffered "a rupture during a hydrostatic pressure trial" in overnight testing.

There has been growing anticipation on Wall Street for the launch of Neutron because it is seen as putting Rocket Lab in competition with Space X's Falcon 9, while further bolstering the company's share of the burgeoning space economy market.

Rocket Lab has thus far built its name on its Electron launcher, which plays a significant role in the payload sector.

But Clear Street analyst Greg Pendy initiated a Buy rating on RKLB shares in a client note last week, citing "strong positioning and multiple growth levers driving further upside."

"RKLB is not merely a launch provider; its unique, vertically integrated model creates a powerful competitive platform that, in some areas, rivals and in certain respects surpasses the breadth of industry leader Space X's (private) offerings, while positioning the company for strong top line growth opportunities over the next five years," Pendy said.

RKLB shares have soared more than 271% over the past year.