[[Home|🏠]] <span style="color: LightSlateGray">></span> [[Interviews]] <span style="color: LightSlateGray">></span> November 14 2024 **Insider**: [[Peter Beck]] **Source**: [CNBC Closing Bell: Overtime](https://www.youtube.com/watch?v=MO9y8HsEgKk) **Date**: November 14 2024  🔗 Backup Link: https://www.youtube.com/watch?v=MO9y8HsEgKk ## 🎙️ Transcript >[!hint] Transcript may contain errors or inaccuracies. **Morgan:** Joining me now, Peter Beck, CEO and founder of Rocket Lab. Peter, it's great to speak with you today. You just put out quarterly earnings, better than expectations. You also raised fourth quarter guidance. You continue to do more Electron launches, and Space Systems continues to grow strongly. Walk me through what you're seeing across your businesses right now and what's propelling the momentum. **Peter Beck:** Yeah, no, thanks very much Morgan. Well, I mean, it is as you say. We continue to execute well on the Space Systems business. And Electron, the small launch vehicle product that we have, is continuing to do well. The ASP continues to rise, and bookings are incredibly strong. Then of course, Neutron is making great progress. There's a lot of technical milestones met and also some commercial ones as well with the first signing of some contracts. So it was a great quarter, and we continue to see really strong momentum within all the business lines. ### Space Systems Business **Morgan:** I do want to get to Neutron, but first, just the fact that so much of the time we talk about Rocket Lab, we talk about the rockets, but that Space Systems business is the business that's growing so strongly right now and is moving you closer to this path of profitability. So if we could just talk a little bit about what you're seeing there and the growth you're seeing there. **Peter Beck:** No, you're exactly right. I mean, what we're trying to build here is an end-to-end space company, and launch is super important—it's literally the keys to space. But our Space Systems group is what enables us to build the infrastructure in orbit. We supply components to a tremendous number of projects around the industry. But if you look across the Space Systems group right now, we have over 40 spacecraft in backlog, ranging from missions to Mars through to telecommunications and National Security missions. So that part of the business continues to go from strength to strength. But I think it's always important to remind everybody that the end goal here is to build an end-to-end space company, with launch being a cornerstone. But as you point out, the ability to build whatever satellite you need to provide whatever service is desired is super important. ### Launch Business: Electron and Neutron **Morgan:** And so if we shift back to Electron and Neutron launch here, what are you seeing in terms of interest for Electron, especially as you do start to develop this new medium-lift rocket, Neutron? **Peter Beck:** So Electron had another strong quarter with over $55 million of new bookings. And then of course Neutron—this is the largest project within the company. Neutron is really designed to do a couple of things: 1. To try and dislodge some of the medium class launch monopoly that's in the industry today 2. Provide an ability for us to launch our own payloads and build our own constellations and services in orbit So having that reusable multi-ton capability is really, really important. **Morgan:** Neutron still track for its first flight next year? **Peter Beck:** You bet. We're hitting some great milestones. The Archimedes engine is going really well, and we had a major milestone of a stage two tank in full flight configuration in a wet dress. So it's going well. I always caveat with it's a rocket program, so anything can happen at any time, but right now I think the team's feeling really good and we're reaching milestones that we need to. ### National Security **Morgan:** And you announced that you signed your first customer as well. You've also stated your intention to go for National Security contracts. What do you see as the biggest marketplace for that new rocket? **Peter Beck:** It's a bit of both really. There's tremendous demand within the commercial sector—a lot of mega-constellations. You saw us sign our first commercial customer in that vein. But also on National Security, if you look at the National Security front right now, especially in SSL Phase Three Lane One, the last award was to one provider. So there's a desperate need for some kind of diversity within National Security around that Lane One medium class launch. We've been very lucky over the years to work very closely with the Space Force to bring a vehicle to market that is incredibly relevant to the mission. So we look forward to on-ramping the vehicle and playing our role within the National Security of the nation. ### Space Policy **Morgan:** So what do you think a second Trump Administration is going to mean for space policy? **Peter Beck:** I think it's good. The Administration has a very strong focus on space and National Defense, and when space does well, Rocket Lab does well. So we're very happy about that. And of course, there's an even stronger focus on highly efficient contracting and highly efficient outcomes for taxpayers' dollars in the space domain. That's where Rocket Lab excels as well. If you look at our historical government missions, they've always been at price points and timelines that I think this Administration will find very attractive. **Morgan:** SpaceX has dominated the launch market largely. You now have Elon Musk in the mix with the administration. What do you think that potentially means? **Peter Beck:** I think it'll be an even sharper focus on those two things: a sharper focus on space and a sharper focus on efficiency, which is great for us. ### Competitive Landscape **Morgan:** And in terms of Neutron, as you do start to see more other types of rockets come online, including SpaceX's Starship, I just wonder what you see this competitive landscape evolving to? **Peter Beck:** It's funny—I recall a conversation we probably had a few years ago about the small launch industry. There was at one point something like a hundred small launch vehicles, and it basically shaped out to just one. And I think you'll see a similar kind of whittling down in the medium class as well. I think there's a number of medium class launch vehicles in development, but getting a vehicle to the pad and then scaling it is extraordinarily hard, as we've seen. So I think it's going to be a relatively condensed environment for launch, which is great for demand. But I think there's a number of new interesting launch vehicles and services coming on the market. It'll be busy times for everybody. ### Most Excited About **Morgan:** And whether it's from the launch standpoint or whether it's from space system standpoint, the fact that Rocket Lab has its hands in some of the most dynamic space exploration programs that we're seeing take shape right now, I wonder what you're most excited about. **Peter Beck:** There's a lot to be excited about. Obviously, Neutron opens up a lot for us, especially in providing and ultimately providing services from space. But I think about some of the other programs—we've talked about the National Security, but one that we've got our eye on is the Mars Sample Return. It's one of NASA's most important missions, and we think we're really well placed to go after that. If you look at all the key elements, whether it's launching off a little planet with little rockets—I'm not sure who does that better than us—and through to bringing samples back to Earth, there's a lot to be excited about. We're certainly putting our oar in the water in a lot of those really large, nationalistic programs. **Morgan:** You still have plans to go to Venus? **Peter Beck:** Absolutely, but as you know, it's a nights and weekends project, so there's not that many nights and weekends anymore. We're too busy doing all the other stuff. But it's a philanthropic project that we have to search for life in Venus. Currently, I think we're aiming for about a 2026 launch. It'll be very helpful to have Neutron up and running there to be able to loft that up. But it's certainly a project that we're very passionate about here. ### Rocket Lab Stock **Morgan:** And then finally, given the fact that Rocket Lab stock is up double digits today, it's more than tripled over the past three months, it's up something like 380% over the past 6 months—I could just keep going here—but it does seem like a tide has turned in terms of investors starting to understand the space business. I wonder if you think that's true? **Peter Beck:** I think so. SpaceX is the largest space company in the world, and I think people are starting to understand that Rocket Lab is looking like it's going to come in as the number two. If you look at SpaceX's valuation, it's something like over $200 billion. Rocket Lab is 5% of that or under 5% of that. And as those two companies start to look more and more similar, it's not surprising that the valuation gap starts to decrease over time. **Morgan:** Peter Beck, founder and CEO of Rocket Lab, always great to speak with you. Thank you so much. **Peter Beck:** Thanks Morgan, great to catch up.