Rocket Lab's stock sinks as Neutron launch is delayed again
Rocket Lab Corporation's (RKLB) shares dropped nearly 5% on Friday after it said that it will once again be pushing back the launch of its Neutron rocket, with the company now targeting the fourth quarter for the mission.
Rocket Lab noted the new estimated launch date as part of its fourth quarter and full year 2025 earnings.
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.
The latest delay does not come as a surprise after the company announced in January that the rocket had suffered "a rupture during a hydrostatic pressure trial" in overnight testing.
The company said at the time that it "pushes Neutron to the limits and beyond to qualify its systems and structures for launch" and the rupture happened during testing for the Stage 1 tank.
"Testing failures are not uncommon during qualification testing," Rocket Lab said in a statement. "We intentionally test structures to their limits to validate structural integrity and safety margins to ensure the robust requirements for a successful launch can be comfortably met."
Rocket Lab cited this rupture as the reason it was delaying the launch until Q4.
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.
Shaun D’Mello, Rocket Lab’s vice president for Neutron, has said that a "rocket like Neutron has never been built before, and we’re doing it at a pace and price point that’s going to bring the innovation and competition needed in today’s industry,”
But Bleeker Street Research published a short report on Rocket Lab in February 2025, accusing the company of overpromising on its Neutron rocket, suggesting insiders expected a delay of one to two years beyond the company’s original mid-2025 target.
CEO Peter Beck said during Rocket Lab's earnings call in August that the company needed every milestone to go right for Neutron before it gets the green light for a launch.
"We’re not going to rush and take stupid risks," he said.
Rocket Lab reported $180 million in revenue for Q4, beating Wall Street's expectations of $178.2 million. However, its loss of nine cents a share was higher than the consensus expectation for a loss of five cents a share.
Its full-year revenue of $602 million was good for 38% year-over-year growth.
KeyBanc analyst Michael Leshock reiterated a Sector Weight rating on RKLB shares despite the Neutron delay, noting that the firm still views RocketLab "as one of the highest quality companies within the Space sector," but noted that "near-term upside appears limited."
Meanwhile, Cantor Fitzgerald analyst Andres Sheppard maintained an Overweight rating on RLKB while raising his price target to $85 from $72 in a client note on Friday.
"RKLB has now completed >80 successful launches to date, and we continue to view this successful track record and launch heritage as an important moat in the industry," Sheppard said.