[[Home|🏠]] <span style="color: LightSlateGray">></span> [[Interviews]] <span style="color: LightSlateGray">></span> May 14 2025 **Insider**: [[Peter Beck]], [[Adam Spice]] **Source**: [Scott O - Youtube](https://www.youtube.com/watch?v=9nLS-gN3l8o) **Date**: May 14 2025 <div class="responsive-video"> <iframe src="https://www.youtube.com/embed/9nLS-gN3l8o" title="Full Interview with Rocket Lab’s Sir Peter Beck and Adam Spice" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe> </div> 🔗 Backup Link: https://www.youtube.com/watch?v=9nLS-gN3l8o ## 🎙️ Transcript ### Introduction *[0:00]* **Vince**: Today we have a new interview with Sir Peter Beck and Adam Spice of Rocket Lab. We're going to ask you guys some questions about the Q1 earnings and some questions that the retail investors might want to have answers for. We want to congratulate you on a fantastic quarter which we felt it was and yeah, let's shoot away with the questions. ### Neutron Development and Customer Priority *[0:24]* **Vince**: The first question that I wanted to ask - it feels like on Neutron you guys have sold the next three slots: two was for a confidential customer and one is to the US Air Force. Do you know when you're going to be flying your own satellite on Neutron and what goes into prioritizing customers versus your own constellation? **Peter Beck**: Yeah, hey Vince. So the priority is to flesh out Neutron as a commercial launcher first before we start flying our own stuff. Now we'll be opportunistic if we have spare capacity. You know, just not that dissimilar to what we do with Electron - if we want to develop new hardware or get some flight heritage on some new hardware, we'll take that opportunity. But we're not really at the point yet where we are assigning tails to our own stuff. Like I say, we'll always take opportunities when they come but we're not there yet. ### Neutron Integration Approach *[1:36]* **Dave**: I was going through the payload guide and I don't claim to understand the majority of it, but I did think it was pretty interesting how you had the two modules there - the upper module and the lower module - and how you could transport them separately. I don't think I've seen that before so what was the decision-making on that and what benefits does it give you? **Peter Beck**: There's kind of two ways to integrate Neutron. One is that horizontal module approach and we developed that approach - what that does is it negates the necessity for a vertical stacking tower. Really that's just a capex decision. *[2:19]* In the ideal full flow, high cadence rate, we always said that we never want to break over the rocket. So literally the rocket will come off the barge, get transported back to the launch site, and then there's a gantry tower building that rolls over the rocket and can integrate satellites and stack the second stage and satellite stack all in one unit and drop it into the hungry hippo and close it and then go. So the rocket never ceases from being vertical. *[2:49]* But obviously a big rollover tower integration building is a fairly expensive capital item. For the initial launches we just do that by breaking off the module and shipping the module. This follows a similar approach we did with Electron - we didn't go out and build two launch pads and three clean rooms and a whole bunch of facilities. We started off with one hangar, one clean room, and then as the vehicle started flying and the cadence increases, then we make those investments. ### Neutron Testing Progress *[3:46]* **Scott**: With the success in testing so far on the Neutron campaign - the videos that you guys put out, stage one qualification and everything - I feel like we're getting very close. You're starting to see the milestones get closer to launch and I feel like we're getting to a place where a lot of these milestones are clumping up at the end. We're going to move very quickly once we get there. How far do you feel like we are from seeing a fully integrated Neutron at Wallops? And then how quickly would we see a wet dress rehearsal after that? **Peter Beck**: You've just laid out the dream run. If you look at all the milestones that we put up, we're at pains to reiterate that they're all happening concurrently. Some of them, as you point out, are very close to completion. Some of them are dependent on each other, a lot of them are independent of each other. *[5:14]* In some areas we're right at the nitty-gritty, the end test. Like take stage one module for example - every element, every piece of software is in that and we're in this all up testing phase. It's very tempting to say "I'll call that done because it's like 98% done." But until it's 100% done, it's not 100% done in our world. *[5:41]* As those components get integrated, providing that we don't find any issues, then you move pretty quickly into a wet dress. And if you do a wet dress and you find no issues, then you move very quickly into a launch. Now I think we should all be realistic about that - you're building an integrated complex machine for the first time. We all hope that there's going to be no issues, but there could easily be things that crop along the way. You've heard me say many times, "everything's great until it's not." But at the moment, we haven't had any major project setbacks or things that have just gone super pear-shaped, and we continue to track. If you look at an Electron wet dress, for example, we'll wet dress the day before and then go fly. But if you look at the very first Electron, we wet dressed and it was quite some time before we actually flew because we were trying to understand the rocket and all the new systems that you stand up. I think we're certainly better than we were when we did the Electron, but you can measure how good we are when we actually get to that point. ### Neutron Production Strategy *[6:57]* **Matt**: That's good feedback, and I'm sure we'll see milestones quickly. You guys have been doing a phenomenal job. A follow-up to that - I know when you guys were building the Archimedes, that first one that got onto the test stand at Stennis, I was very surprised to see that number two and number three came out very quickly to join it. And obviously now you guys are doubling capacity. I'm curious - before I hand it over to somebody else - are you guys already working to create another stage two/stage one with the Neutron? Are you waiting to get a kind of a fully integrated dynamic test before you roll out the model number two or serial number two rather for Neutron? **Peter Beck**: No, I mean, we intend to try and fly three times next year. That's our ramp rate. So we're building multiple flights worth of hardware now, and that's part of the scaling efforts that we've talked about. We've kind of moved past slightly past the minimum viable product to investing in like the barge 'Return on Investment' and in multiple serial numbers. In the components and areas we have super confidence in, we're plowing straight forward. **Adam Spice**: And by the way, part of what's consuming cash right now is exactly what Pete is saying. It's one thing to get to minimum viable product and infrastructure, but now we're actually investing in subsequent tails. We're investing like Pete said in the barge and so forth. So that's all about scaling the business, but it's starting to show up now in kind of the working capital needs of the business. It's all good stuff, it's just a matter of that's why we're so focused on making sure that we've done all the right things and put everything in place so that we can just deliver on the expectations. And flying a new rocket three times next year when the first launch is in the second half of this year - that's not an easy task. So we got to make sure that we're doing all the preparatory stuff, and I think we've made a lot of investments in the team and other parts of the business to really enable that that really wasn't in place seven years ago when Electron was just beginning to ramp up. ### Electron and HASTE Launch Updates *[9:10]* **Scott**: Since Electron was brought up, if you guys don't mind me pivoting - during Q1 we saw the eight new Electron signings, four of which were the second batch of iQPS. And then if we look at the other four that were signed during the quarter, it looks like the ASP lines up nicely with what could be assumed to be four HASTE launches. Is a 50/50 split between Electron and HASTE a fair assumption? And if so, is the Kratos mission that was announced in April one of these presumed HASTE signings? **Peter Beck**: I'd have to go back and have a look at that information. It's true that the HASTE ASPs are generally higher because the mission requirements are a lot more complex, ironically, than going to orbit. *[10:06]* **Peter Beck**: I think only one of those is the HASTE. **Adam Spice**: That's what I was going to say, yeah. It's one. The good news is we're seeing a firming of ASP across all of the different variants of Electron. Certainly as Pete mentioned, the HASTE variant really helps bring up the ASP. Partially it's a bit of a unique vehicle, but also there's the different mission assurance requirements that those HASTE customers require versus a traditional commercial launch. You don't get the same kind of rinse and repeat benefits you get when you sign up a 10-launch commercial deal. But all in all, the HASTE missions are helpful because they're growing quickly, they're margin accretive, and their ASP is accretive as well. ### International HASTE Capabilities *[10:53]* **Scott**: As a follow up on the topic of HASTE as well, Rocket Lab was recently selected by the UK's Ministry of Defense to help develop hypersonic capabilities. What are the limitations of HASTE at an international level given the defense nature? For example, if the UK were to require a HASTE launch from you guys, could that go off on American soil or is that going to be particular for each government - it has to be from their own soil? **Peter Beck**: It's a good question. Typically those launches are from US soil. In order to launch off foreign soil, you have to have technology safeguard agreements in place and a whole bunch of those regulatory or cross-government and cross-regulatory approvals. Not saying that's not possible, but that is required. And of course, we have to establish a launch site, whether it be mobile or fixed, in that nation, which is no trivial kind of thing. But typically they are joint research programs as well. ### HASTE Market Potential *[11:57]* **Dave**: Pretty excited about the growth prospects there with HASTE. Just kind of curious, can you give us an idea just how big that TAM is? Could we ever see a day maybe long in the future where there's more suborbital launches than orbital launches for Electron? **Peter Beck**: Yeah, potentially. The head of the hypersonic suborbital program was publicly stated as he wants to fly every day. Now I'm sure not a HASTE mission every day, but that gives you a sense of where that program's going. We maintain in a pretty unstable environment and the US really needs to get its stuff sorted with a whole bunch of these hypersonic systems. We certainly see strong growth in that area and we provide a really important service. We expect HASTE to be a pretty significant part of Electron going forward. ### UK Defense Contract and Hypersonic Expansion *[13:06]* **Matt**: There was the AUKUS Pillar 2 announcement in November 2024 and how it pertains specifically to expansion of the United Kingdom, Australia. I think part of what we saw with the UK deal was it was like one of five potential launch providers to be able to win a contract. As we've seen that UK contract come through, how competitive do we think Rocket Lab is? And what can you say with that with respect to the rest of hypersonic expansion opportunities in the rest of the EU? And the reason why I ask is because I know the United Kingdom and several four or five other countries have kind of a consortium for hypersonic with like High Flight and things like that. Where do we see the potential for that UK to eventually maybe spill over? **Peter Beck**: I think you teed it up nicely - the five eye allies or the AUKUS pillars group of countries are very deeply sharing in some of this defense technology. That's where the core focus of this will lie. One of which, New Zealand is a partner in the five eyes group, so that enables us to engage very deeply there as well from a New Zealand side. *[14:41]* With respect to your question of how competitive we think we're going to be - as far as I know, there's not too many vehicles that can provide anything up to sort of Mach 25 with a high frequency and high cadence ability. We think we're very uniquely placed. Just the ability to produce vehicles at rate and fly them at rate and fly them out of different launch sites - I don't know anybody else in the world who has that capability right now. ### Engine Testing and Qualification Process *[15:16]* **Vince**: I just want to circle back to Neutron for two last questions. One of them I feel like you kind of answered it, but I still just want to ask it. I'm the guy who's like "Okay, you did a hot fire test on the engine, you see it run once, why can't it be just strapped onto a rocket and then you fly?" So for non-rocket engineers, when you're doing the qualifications of stage one, stage two - what does that involve? In my mind it's like you flip on the switch, okay the lights come on, okay the canards are moving, it's good to go. That's how I would do it, and that's why I probably don't work at Rocket Lab. But what is it that goes into these qualifications? **Peter Beck**: Well to be fair Vince, that's how some others do it and we all know where that ends, right? The way we roll here is we'll test and probe every operation - nominal and off-nominal. We don't put anything on the pad or any spacecraft in orbit unless we've thoroughly tested. I think that's part of the magic of Rocket Lab - we have very good simulation tools, very good hardware in the loop tools, and then when we actually build the hardware there is no shortcut taken. *[16:31]* With respect to propulsion, we are exploring every part of the runbox. The challenge with the runbox in the Archimedes engine is it's not just a simple ascent burn where you've got very well conditioned propellants and 200 seconds later they're extinguished. You have the added complexity of coasting the first stage for a while, mixing the propellants with the ullage and all the gases, so the propellants get warm. And then when you go to relight for your landing burns, you've got totally different conditioned propellants, totally different pressures and temperatures, which all really matter. We've gone to pains to make sure the Archimedes is the simplest engine you can build but at the end of the day it's still a stage combustion cycle engine and it's still you know really complex piece of machinery that when you change the inlet temperatures and pressures of propellants, things move around. Right now we've just been doing I would say pretty abusive things to the engine, really trying to understand those startup and shutdown transients and all of the things we need to do. And then of course on stage two we have a couple of relights depending on the mission. So once again it can be 45 minutes before you do the relight. So what is the condition of propellants after that period of time and how do you define what the runbox looks like? The crude thing to do would be just do a first stage profile, run a few tests, call it good. But that's just not the way we roll. ### Retail Investor Interest *[18:18]* **Vince**: The retail group, quite understandably, would really like to have a launch party with you present at Neutron. I understand that it's very challenging because you cannot set a launch date and you're a very busy person. So I was thinking that maybe a middle way could be when Neutron is ready enough to have like a retail meetup with maybe someone like Adam or you present where the retail could get a tour of the facilities or the rocket if this is possible. **Adam Spice**: I'm actually more fun to party with than Pete, just to make a statement there. *[19:25]* **Peter Beck**: That's a fact! I can barely make my own birthday party let alone a launch party. The reality is that if it's launch day, any of us are not going to be interesting people to be around. It is all consuming. I'll most likely have spewing up in the corner with nervousness - that's not untypical of especially a new launch. *[19:59]* Everything has to be lined up and perfect. I think one interesting thing would be for one of you guys to come and watch a Neutron launch - sorry, an Electron launch - and sit in mission control. I think very few people understand the ballet of stuff that needs to happen in order to be able to even launch. All the weather and the space radiation concerns and then the vehicle and your payload readiness. It's amazing that anything ever launches if we're honest. *[21:43]* **Adam Spice**: Nothing's stopping you putting a party together Vince. You put the big party together and it doesn't necessarily have to be around a lot. Perhaps when we get to the line of sight vehicles on the pad, the right time. We're all about creating transparency and access right so I think that would be consistent with that. **Peter Beck**: Yeah, that'd be a much easier thing to do. We could do like an investor day or something like that and then there's a vehicle on the pad and you can wander around the pad and stuff. That would be pretty cool. ### Space Systems Overview *[22:19]* **Dave**: Up to this point I had viewed over the past year Lightning as kind of the big growth driver for space systems and now that Flatellite is in the picture, I'm curious as to how this all shapes up. Is Flatellite just a superior form factor or are there cases where Lightning would be a better option? **Peter Beck**: They're two totally different things. Lightning is actually a fantastic national security platform. It has all of the redundancies and equipment on board that national security missions really require. So that's kind of our go-to platform for a lot of those missions. *[23:10]* If we're doing a high volume large constellation, then every gram of the satellite matters because it equates to how many you can get into a launch vehicle. That's where Flatellite really excels - its ability to dispense with the dispenser and maximize every gram on the satellite to add as many of those in a launch vehicle as you possibly can. So it's kind of different products for different things. Lightning won't see a decrease because of Flat coming online. ### Flatellite Design Philosophy *[24:16]* **Vince**: On Flatellite, my question is how did you come up with that idea and was it something that customers were organically asking for? Are you in talks with customers about deploying Flatellite? **Peter Beck**: If you kind of devolve the engineering down to "I need to put the maximum number of spacecraft possible per rocket," then you naturally end up at that shape. It's just like a bicycle - if you derive the most efficient frame of a bicycle to carry the loads of a human, you end up with what looks like a bicycle. That's pretty much how we arrived at that. Look, there's other examples in the industry where other people had arrived at the same conclusion. I'm not going to proclaim any visionary moments here - it's just pretty matter of fact and functional that that's what you optimize down to. *[25:27]* We don't do stuff of dreams. Obviously customers approach us and a number of them have requirements for large constellations. So this is a response to those inquiries. ### Mynaric LaserComms [25:55] Matt: I noticed that obviously Mynaric and the laser obviously has a big component on Flatellite. I was just kind of curious - I know there's pros and cons of using radio, there's pros and cons of using laser for communications. Will Flatallite have both? And what do you see the pros and cons of utilizing lasers for Flatellite rather than potentially radio if radio isn't available on Flatellite? Peter Beck: You make a good point Matt. Radio links have been done in the past. Laser links are actually pretty new. It just comes down to bandwidth - you can just move so much more data at such less scale of antenna and boxes. It basically just comes down to that. If you're not meshing your satellites up and you're not needing to hand off data between them, then you can have a pretty low bandwidth radio link and that's super easy. But if you're looking to be providing a mesh network and handing off lots and lots of data, then you really need the laser links. Even government programs have gone to laser as we know with SDA. It's kind of the next evolution for inter-satellite communication. And then you have to worry about RF spectrum and all of that kind of stuff. [27:37] Matt: It was always kind of my thought that it's easier to - I don't want to say hack but I'll use the word hack - but it's less security, in my opinion, from what I've read. And then also it just seems like the interference with so many different people already utilizing it seems like it'd be pretty big issue. Peter Beck: Well, it's true. You have focused laser and you've got to be in pretty close proximity. I mean there's not really any scatter of information, you have to directly couple the laser up. So certainly you can't just sit on the ground with a big antenna and listen in, that's for sure. ### Component Development and Manufacturing *[28:18]* **Scott**: There were a few components announced during Q1, one of which was the 5NMS reaction wheel that was largely built on the heritage of Rocket Lab's reaction wheel family. Is it safe to assume that this new wheel was designed to serve Flatellite or is it more geared towards external customers? **Peter Beck**: External customers. It was kind of a hole in the offering. All of our products are responses to customers' inquiries or our own needs internally, but that one is definitely customer-driven. You expect to see this from us - we don't really talk about it a lot but there's a lot of products in development for the commercial market because we're looking to grow. As you become more prevalent in each industry, the only way to grow those is to develop and bring new products to market. *[29:35]* **Scott**: Since being acquired in 2022, SolAero has seen several large investments geared towards expansions and upgrades. With STARRAY being announced, are you able to shed some light in terms of the production capacity? **Peter Beck**: We continue to expand that. We would have seen that we won a lot of CHIPS money to put in new reactors and increase the capacity. We're continuing to invest and increase the capacity of that whole facility. We continue to see a really high utilization of all of the reactors and fabs. *[30:47]* The STARRAY is quite a cool product because we have a lot of customers coming to us - the original SolAero business, they would sell either cells or panels but they never made arrays. So this is a great example where we were able to bring other Rocket Lab businesses together, mainly the mechanisms businesses from PSC, who are used to doing separation systems and develop hinges and sliders. That enables us to provide a complete array. ### Defense Market and SDA Program *[31:57]* **Dave**: SDA obviously a very important customer. I was a little surprised to see they just announced they were pausing procurement of the Tranche 3 transport layer satellites. Do you think this could signal a bigger shift or are there any concerns about that constellation? **Peter Beck**: We weren't certainly that surprised with that. If you look at the transport layer, there's a lot of commercial coms stuff in play. So I think it's understandable for the government, especially when they're looking to save money, to go "let's pause this and let's see if we can achieve what we need to do with the commercial communications and transport layers that are out there." *[32:47]* The thing is that not everybody has a good understanding of the SDA program and its magnitude and the number of layers that are there. Transport is one, but there's a whole bunch of other layers like track and custody and things like that which there's no current commercial solution that even comes close to solving that. So you see that the track layers are still moving forward at full speed. *[33:31]* **Adam Spice**: We've learned from our execution under our transport contract - the facilities clearance, facility security clearance requirements and so forth of handling payload elements. This is not a trivial security undertaking. I have to scratch my head and wonder how much of that is just "hey, we've already procured a bunch of this stuff, let's get it put into use" before we do the next layer, rather than "is there really a wholesale swapping opportunity with stuff that's already out there?" I'm just a little bit skeptical that off-the-shelf stuff is really gonna get the job done for what they've got to deliver. ### NASA Budget Changes and Impact *[34:27]* **Vince**: It seems like the Trump administration is doing quite big cuts to the NASA budget and certain programs seem to be on the chopping board. For example, the Mars sample return program seems to be cancelled. What is Rocket Lab doing to stay competitive or being able to take advantage of these changes in the NASA budget? **Peter Beck**: Not that much of our work is actually historically and even today NASA based. So it's not like a huge part of our portfolio. Nevertheless, I love the interplanetary missions. I'm always a strong advocate for that, but for sure there's going to be some changes there. *[35:36]* The reality is that no matter what happens, if space wins, we win. We have just so much componentry and technology across the board that's integrated into so many of these platforms that if it pivots away from the moon to Mars or wherever, that's fine. We just make components for Mars rather than components for the moon. *[35:59]* Mars sample return we thought was very unique. We'll see if it's - I agree with you Vince, it's sounding like it's pretty dead. But you never know, especially as the Chinese make much more noise about going there and getting their own samples. It was a great opportunity for us to showcase a true end-to-end solution and how that can impact these big missions. $11 billion in 2040 got shaved down to under four in the early 2030s. That's the power of vertical integration and that's the power of an end-to-end space company. ### Global Space Race *[37:06]* **Matt**: Do you think there's a very modern global space race going on and what does that mean to you specifically? What do you think that means for Rocket Lab going into the next decade? **Peter Beck**: I think yeah, there is. If you look at China, it is the next evolving space superpower and it's pretty impressive how quickly they are advancing. From a few old heritage Russian rocket designs through to building their own space station, successfully bringing back samples from the back side of the moon, their own Mars sample return, their own aspirations to land astronauts on the moon. If you look at the scale and the rate of evolution there, it's really high. I think that's been noticed by a lot of people. I think there is somewhat of a space race going on. I think that's going to become much more prevalent in the coming decade. *[38:32]* **Adam Spice**: I agree with that. I also look at it from how it's picked up a lot of momentum since the change in administration where the geopolitical tensions have risen to the point where you've got this confluence now. You've got a rising amount of tension even amongst current or former allies, and the access that folks like us bring to the market as far as lower cost access to space. You really have these other sovereigns that used to have to rely on their partners - us being one of those - now they can really control their own destiny when it comes to having a space-based presence. *[38:59]* Five years ago I would have said this capability would be something that would be centralized and owned by one person and shared amongst many. I think now people don't trust that they'll have access and they can now afford to do it because the cost has declined so significantly. So I think the concept of the space race is quite real and I think it creates a multiplication factor when it comes to the size and number of opportunities. *[39:35]* Fortunately for us, there are very few organizations that have all the capabilities that we have. Even if there's an entity out there that can afford to do it that's not a US-based one, the likelihood that they would have sovereign capabilities to help deploy what they need is very low. So I think it's going to create a much bigger market opportunity than we were thinking about several years ago. ### European Market Strategy *[40:28]* **Vince**: When you turn on the finance news, everybody is saying that Europe is uninvestable, get out of Europe. And yet you guys seem to be very bullish on the prospects in EU. What do you guys see there? Is it government customers or do you see acquiring startups and talent that is in the EU? **Peter Beck**: We look for the best teams and the best technologies no matter where they lie in the world. That's point one. Point two is we've always kind of scratched our head about how do we enter the European market because as you know, it's very protected markets with the geo return. For those who aren't aware of that, ESA collects all the money from the various countries and then distributes it back out in a similar ratio. Germany's got propulsion, France has got a whole bunch of stuff, and the rest of the European countries have various elements. *[41:36]* Because it's such a protected environment, it's basically impossible for a US entity to work with those governments. By having that facility and company in Europe, it opens the door for us to work with those companies and countries that we were basically blocked from before. Yes, it's a smaller market than the US, but it's the next biggest addressable market in the world, so we should be in there. *[42:14]* **Adam Spice**: Like for example, if Mynaric just happened to be in Munich, happens to give us access to these ESA opportunities as Pete mentions, but it was the best technology solution for the problem that we're looking to solve. We had already vetted them and chose them as our solution partner for our SDA program win. For us it's - again, Pete said we go after talent and the best technical solution. Our first acquisition was Sinclair in Toronto. It's not like Canada's got a huge space opportunity to exploit, but it was a great team, the right product, the right solution, and then we've been able to come in and scale that business almost 10x since we acquired it only a few years ago. ### Deal Flow and Acquisitions *[43:56]* **Adam Spice**: When it comes to deals, it's a very active time right now. There's a lot of deal activity. Fortunately, we seem to be the go-to when an interesting asset looks to come to market. I think first it's probably driven by employees saying "Hey, where do we want to be?" Certainly the private equity owners or the VCs and the shareholders try to get the highest price, but it's no small consideration to think about where the asset would fit best from a culture and everything else. We see everything, and maybe we're seeing a higher deal flow because of where we sit in the ecosystem relative to our market cap and our broad platform. But it is very high - there's a lot of activity right now. ### Talent and University Partnerships *[44:49]* **Matt**: Are you looking to deepen any university partnerships? I was actually at one of the IEEE launchpads south of Houston recently and I noticed that a lot of these universities are really starting to get back into post-pandemic launch and being able to get their certifications. **Peter Beck**: We do, Matt, actually. Both in New Zealand here and also in the States. We work alongside a number of universities. It's a great talent pool and we have a very active internship program. The bar is unashamedly high to get in as an intern, but that has proven just to be a great source of talent. *[46:17]* Actually, I was quite surprised last year. I was sitting in on a valve design review for Neutron and we went through this whole review and there was 98% good, there was just like 2% where that engineer should have known better than that. I get right to the end and we're leaving and the guy's like "Well, my internship's finished now and I'm back to school." And I'm like "What? You did this whole design of this whole valve program as an intern?" It was truly spectacular. That guy works for us now, as you can imagine. Some of the kids that are coming through - pretty amazing stuff. ### Venus Mission Update *[47:19]* **Dave**: Could you tell us a little bit about the Venus mission? Why you remanifested it over to Neutron from Electron? I think the bus might have changed at some point as well. Is it still planned for maybe second half of '26? **Peter Beck**: Obviously Venus takes a backseat to everything else, but you're exactly right - we did remanifest it onto Neutron because that particular mass on Neutron is kind of like a rounding error. It just gives us a lot more flexibility. We can easily put that on as a ride share on a primary mission. Provided the customer agreed, it could stow away underneath a payload plate - nobody would ever know from a performance perspective. *[48:20]* Right now the manifest is packed with Electrons and we just continue to sign more and more of those. So pulling an Electron off the production line to fly a Venus mission that's purely philanthropic is getting harder and harder to do, whereas on Neutron it's much easier. The added advantage of Neutron is we're using the lunar Photon bus platform. That is an extremely high performance platform - every gram in that thing is accounted for especially when it's launched on an Electron. When it's launched on a Neutron, who really cares? You just don't have to - it's just not as hard to do anymore. It removes a whole bunch of constraints on ISP and engine performance and mass and all those kinds of things. ### ATM Equity Program *[49:39]* Scott: If we look at the recently announced at-the-market equity offering program, roughly 20% of that $500 million was tapped during Q1. Is this a similar rate we could expect going forward - this 20% per quarter - or should we expect something maybe a little bit lighter or maybe even a little bit more aggressive depending on the acquisition pipeline? **Adam Spice**: The beautiful thing about the ATM program is that it allows you to be flexible, allows you to be either proactive or responsive very targetedly. If we were to go out and put more capital on the balance sheet, you'd probably want to go do that similar size - call it 3 to 500 million - because that's an economically interesting thing to go do for certain types of investors. *[50:40]* When you do it in a marketed deal, you have to give a discount - typically anywhere between a 10 and 15% discount to market, which is not very shareholder friendly. You have to commit to maybe an amount of dilution that you might not ever actually put to work. The good thing about the ATM is you do it when you need to do it. You can be very precise about it. You don't pay a discount, you basically just pay a commission to the bank who executes on your behalf. *[51:22]* You may have noticed what we tapped was in the vicinity of the Mynaric deal that we announced and the capital that could be consumed from that deal. You can probably expect us to be pretty deal driven on something like that. Having a certain amount of dry powder is always very important. It's also very important to be able to point to a facility like an ATM and say "hey look, we were able to pull down $100 million to go facilitate this deal that's now public, and by the way we did it with very minimal to no disruption to the stock." *[52:48]* **Peter Beck**: Highly disciplined about it - you're not going to see us blow out hundreds of millions of dollars and do disruptive things. Very disciplined, very targeted. As Adam mentioned, it's a very target-rich environment right now and it's almost our duty to make sure that we have the ability to execute on some of these things when they come along. ### Neutron Reusability Strategy *[53:22]* **Matt**: We know that there's obviously one R&D launch at least planned. How many R&D launches? I know obviously we're going to try to land this thing. Is there kind of like a Starship-esque methodology where you fund several launches to be able to get that landing capability down? Or is it more so just the first launch is to establish "hey, we can get to orbit" and the rest of those landing opportunities will come from commercial launches? **Peter Beck**: It's kind of a bizarre program because the highest production rate of stage ones will be at the start of the program, not the end of the program. So it's kind of an inverse production problem. Normally you start off with just a few and then you ramp up production, whereas we'll consume the most amount of stage ones in the history of the program probably in the beginning of the program. *[54:21]* Of course, the most important thing is to deliver the customer's satellite to orbit - that's what we get paid to do. That will always be the focus to ensure we don't risk that. But it does give us good learning opportunities to get stage one nailed quickly. The first flight obviously we're going to do a soft splash down, but provided that goes well, we'll slip that bit of steel under there super fast and go from there. If it doesn't, then we'll continue to iterate on those stage ones. We've certainly built the capacity we need to be able to bang out those stage ones. *[55:11]* **Adam Spice**: From an investor perspective, I look at it like the first test launch has a couple win opportunities. The first win, as Pete said, is get the customer payloads to orbit because that's what's going to build confidence in the vehicle to continue to build backlog. The customer doesn't really care if we can return the rocket and put it to reusable configuration. But if success is determined as get to orbit, successful re-entry, successful controlled splashdown, and looks like all the data would tell us that we could slip the barge underneath there shortly thereafter - that really is the investor win number two. *[55:48]* Obviously the first is also a win for investors when we can deliver customer payloads, but the margin expansion just occurs very rapidly when you can get that reusability into play. So really in a perfect scenario on this first test launch, we basically validate both and allows you to build the backlog and expand on the confidence and getting that margin to come into focus that much sooner. ### Closing Remarks *[56:19]* **Vince**: We really want to thank you guys for taking the time to speak to retail investors. I think it's very special when companies give us this opportunity. Congratulations again on the quarter and we cannot wait to see what news you have and what happens with Neutron and all the rest. **Peter Beck**: Thanks, Vince. You better get started on that party! **Vince**: Exactly! **Adam Spice**: Thank you guys so much.