The Space Infrastructure Builder Stumbles While the Launch Provider Burns Through Cash Faster

"Redwire focuses on space infrastructure and autonomous systems. The company completed its Edge Autonomy acquisition and reported 50.7% year-over-year revenue growth. Management maintained full-year guidance of $320 to $340 million, and the book-to-bill ratio of 1.25 suggests demand is holding. But the business is bleeding cash with a net loss of $41.2 million in Q3, nearly double the $21 million loss from the prior year. Gross margin sits at just 16.3%, leaving almost no room for error."

"Firefly operates launch services and spacecraft systems. Revenue nearly doubled quarter-over-quarter with 98% sequential growth, driven by its SciTec acquisition for national security capabilities. The company secured a $176.7 million NASA Blue Ghost Mission 4 contract, validating its lunar lander technology. But profitability is worse. Firefly reported a net loss of $133.4 million in Q3. Gross margin of 27.6% beats Redwire but remains unprofitable. The company holds $995 million in cash, which buys time but raises questions about burn rate."

"Redwire bets on infrastructure supporting satellites and spacecraft in orbit. The Edge Autonomy deal expands into defense-adjacent markets, potentially providing steadier revenue than pure space hardware. The book-to-bill above 1.0 suggests the pipeline is growing, but execution has been messy. Redwire missed analyst estimates by 142% in Q3 and posted worse surprises in Q2 (-1009%) and Q4 2024 (-667%). That pattern suggests either overly optimistic guidance or operational problems management hasn't fixed."

Redwire posted Q3 revenue of $103.4 million and EPS of -$0.29, showing 50.7% year-over-year revenue growth and completion of the Edge Autonomy acquisition. Management kept full-year guidance at $320 to $340 million and reported a book-to-bill ratio of 1.25, while Q3 net loss widened to $41.2 million and gross margin was 16.3%. Firefly reported Q3 revenue of $30.8 million and EPS of -$0.33, with 98% sequential growth driven by the SciTec acquisition and a $176.7 million NASA Blue Ghost Mission 4 contract. Firefly’s net loss was $133.4 million, gross margin 27.6%, and cash balance $995 million. Both stocks fell over 20% in the past week.

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