Rocket Lab Retail Mood Hits All-Time Low After Neutron Delay — Can Takeover Target Iridium’s Earnings Turn The Tide?

• Rocket Lab pushed Neutron’s first flight into 2027 after finding manufacturing defects in a carbon-composite tank component.
• Iridium’s Altair partnership aims to bring satellite connectivity to IoT devices and next-generation AI wearables.
• The takeover’s regulatory review is ongoing ahead of the deal expected to close in mid-2027.

Retail sentiment around Rocket Lab (RKLB) sank to its lowest levels ever on Stocktwits after the company pushed Neutron’s first flight into 2027, leaving investors looking to takeover target Iridium Communications (IRDM) for a potential earnings bright spot.

RKLB stock fell 8% on Wednesday, marking its worst session in nearly three months and extending its losing streak to six sessions. Shares are down 13% for the week, putting them on track for their worst weekly decline in about three months.

Neutron Hits Another Launch Setback

CEO Peter Beck said the delay stems from tiny air pockets inside a carbon-composite dome that forms one end of Neutron’s first-stage propellant tank. The gaps between the material’s layers could weaken the component.

The problem appeared in thicker sections added during a redesign following an earlier tank-test failure. Rocket Lab moved from laying carbon fiber by hand through a supplier to using an automated machine while developing a process to harden the large components. 

Beck said engineers reproduced the defect in testing and adjusted the manufacturing process. The revised approach successfully produced a rear dome, and work is underway on a replacement front dome. 

Rocket Lab expects to finish building and inspecting the replacement before year-end, then assemble the first-stage tank and put it through pressure and extreme-cold tests in the first quarter of 2027. Beck said a more precise launch target would follow those milestones. 

How Much Could Iridium Add To RKLB?

The Iridium deal would more than double Rocket Lab’s annual revenue, based on the companies’ 2025 results. A regulatory filing from Rocket Lab puts their combined sales at $1.47 billion, including 601.8 million from Rocket Lab and $871.7 million from Iridium. 

Iridium would also add a profitable business. It earned $114.4 million in net income and reported $495.3 million in operational EBITDA last year. Rocket Lab lost $198.2 million the same year.

Rocket Lab said the acquisition will boost cash flow and profitability by combining its launch and satellite-building operations with Iridium’s communications network, L-band spectrum, and recurring customer revenue. The financial benefits will begin entering Rocket Lab’s accounts after the deal closes, currently expected in mid-2027. 

Can Iridium Deliver An Earnings Bright Spot?

Iridium’s second-quarter sales rose 4% to $225.2 million, with recurring service revenue making up 72% of the total. The company had about 2.63 million paying subscribers at the end of June. Profit fell to $9.7 million, or $0.09 per share, largely because of higher deal-related costs. 

Revenue is expected to rise 1.7% from $225.15 million to $230.85 million, while earnings per share (EPS) is forecast to fall 40% to $0.21 and EBITDA to decline 17% to $101.84 million, according to analysts at Fiscal AI.

Meanwhile, revenue is projected to rise 10% from the previous quarter to $248.54, with EBITDA increasing 13% to $134.75 million and earnings per share more than tripling to $0.32 from $0.09, according to Koyfin. Iridium said in July that it did not intend to hold quarterly earnings calls or provide or update financial guidance while the acquisition is pending. 

Iridium Expands Its Reach With Altair

Iridium announced on Wednesday that Altair Semiconductor is integrating Iridium NTN Direct into its ALT1350 and next-gen ALT1550 IoT chipsets. The integration will give devices access to terrestrial cellular coverage and Iridium’s satellite network without requiring a separate satellite modem.

Applications include asset tracking, logistics, smart meters, agriculture and industrial monitoring. Altair’s platform also targets AI-enabled wearables, including smart glasses and assistants.

Iridium Takeover Moves Towards Finish Line

Iridium shareholders approved the takeover last month, with 99.6% of votes cast backing the deal, representing about 81% of shares eligible to vote. The offer combines $27 in cash with Rocket Lab stock, with the number of shares determined by an agreed formula and price limits, for a notional value of $54 per Iridium share, according to the companies.

Rocket Lab raised $1.944 billion before expenses by selling about 29.3 million shares and obtained lenders’ permission to keep Iridium’s existing $1.775 billion term loan in place after the takeover. It also canceled its original $3.6 billion bridge-loan commitment. Now, the regulatory review is ongoing, with comments and petitions on the proposed transfer of Iridium’s licenses to Rocket Lab due Thursday, followed by oppositions on Oct.30 and replies on Nov.9.

How Do Retail Traders Feel About RKLB?

On Stocktwits, retail sentiment for RKLB slipped to ‘extremely bearish’ from ‘bearish’ levels a day ago to hit a record low of 22/100 amid a 363% surge in 24-hour message volumes. The ticker’s watcher base has jumped 52% in a year, signaling healthy retail interest. 

One user expressed confidence that the Iridum deal “is a sold business with positive cash flow and ebidta 2027. HOLD.”

Another user raised dilution concerns, saying: “the amount of shares they’re going to have to pay for iridium now is going to be asinine.” A separate user said Rocket Lab would become profitable as soon as the Iridium deal closes. 

RKLB stock has declined 15% year-to-date.

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