Planet Labs PBC Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Trevor Walsh - JMP Group, LLC - Analyst : Great. Thanks, team, for taking my questions. Maybe I'll start, Will, with you. If -- can you just give a little bit of your thoughts around the Tanager-1 launch and where you might think the immediate impacts to the business might come from that from a revenue perspective, and maybe, just keeping it simple, breaking it out between defense and intelligence, civil government, commercial just between those three buckets where you think you see the immediate demand coming from?

Question: Trevor Walsh - JMP Group, LLC - Analyst : Great, thank you. I appreciate the color on that. Ash -- yeah, absolutely, and thank you. Ashley, maybe just switching gears a little bit, understood the softness around commercial customers and especially, in the agricultural space. I guess two-part question there. One is from a numbers perspective. It looked like the percentage of the business in the quarter ticked down in commercial from about 29% to 22%, just looking at your investor deck charts you have there. Is that a combination of both the strength in the D&I business compounded by the contractions in the agricultural space, or just broadly within commercial or is it one outweighing the other there in terms of the contribution? And then, second question. Can you maybe just double click a little bit in terms of what's happening within that agricultural arena to have customers either reducing spend or shifting gears a little bit on that front?

Question: Trevor Walsh - JMP Group, LLC - Analyst : Great. Thank you, both. Appreciate it.

Question: Kristine Liwag - Morgan Stanley & Co LLC - Analyst : Hey, good afternoon, everyone. Will and Ashley, in terms of the government opportunities you highlighted, you mentioned last quarter, pursuing NGA's Luno program. And it looks like since they've announced Luno B and the A and B portions of the programs, could be like about $500 million in ceiling combined. So I guess how big of a focus is this for you? How do you think about positioning? Is this one of the big defense opportunities you had referenced? And when would you expect to make a decision or hear about a decision? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, PL.N - Q1 2025 Planet Labs PBC Earnings Call

Question: Kristine Liwag - Morgan Stanley & Co LLC - Analyst : Great. If I could sneak a second question here. It's great to hear that you've been making progress on AI. That's clearly a big driver of growth. A few months ago, we saw Spire announce a collaboration with NVIDIA to advance AI-driven weather prediction. I guess, can you provide more context regarding the AI opportunities you're pursuing? And is there an opportunity for you to also collaborate with NVIDIA, and what could that look like?

Question: Kristine Liwag - Morgan Stanley & Co LLC - Analyst : Great. Thank you very much.

Question: Jason Gursky - Citigroup Inc. - Analyst : Hey, good afternoon, everybody. Will, I wanted to start on Tanager. I'm not sure if I heard exactly your answer there as it relates to revenue generation on Tanager. So can you confirm that you get Tanager up and running? And that on a quarter-on-quarter basis, you're going to be generating higher levels of revenue? I just want to try to better understand exactly what Tanager is going to add to the revenue next year.

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay. Yeah, that is helpful. Yeah, I appreciate that. And then, on the DoD side of things and the three pilots that you've been working on, two have been completed. Is there a possibility here that what we could be adding that a revenue would be something at the scale of your annual EOCL contract? Can you just help us better understand what you think you've got here on the horizon potentially?

Question: Jason Gursky - Citigroup Inc. - Analyst : Will, you did the word, large here. So maybe you can just baseline things for us out here in the investment community. When you use the word large opportunity, is that a five-figure deal, a six-figure deal, seven, eight, nine? How about that word large in your vocabulary?

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay, great. Will, can you give us an update on Pelican and where we go to from here based on the recent tech demo that you did?

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay. So we're going to have some more launches coming in the next 12 months? Is that the right way to think about it?

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay, great. And then, what about international demand in the D&I area? Are there any opportunities for you all, (inaudible), Japan, the Middle East, is there any of our allied nations that might want something similar to any OCL kind of construct?

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay, great. And then, two last quick ones for me. The European regulations around deforestation and some of the basic products coming into the EU and the supply chain needing to demonstrate that they're not leading to deforestation. And I know there's an acronym associated with this regulation. I can't remember off the top of my head. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, PL.N - Q1 2025 Planet Labs PBC Earnings Call

Question: Jason Gursky - Citigroup Inc. - Analyst : Yeah. Thank you. Can you just give us a little bit of an update on the company's involvement in helping those that are importing those goods into the EU, demonstrating that their products aren't leading to deforestation? Has that been -- any catalyst at all for demand for Planet?

Question: Jason Gursky - Citigroup Inc. - Analyst : Last one for me, actually I can't let a quarter go by without asking you about cash flow breakeven and when do we get there?

Question: Jason Gursky - Citigroup Inc. - Analyst : Okay. Thanks, everybody.

Question: Ryan Koontz - Needham & Company, LLC - Analyst : Hi. Thanks for the question, and nice to hear the great progress in the government side and understand there's some strategic resets sound like going on the commercial side. And I know you've talked in the past about some of your efforts there on commercial are going to be with partners and we've heard some partner announcements in the past, and I wonder if you can give us an update there? And any milestones that we should REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, PL.N - Q1 2025 Planet Labs PBC Earnings Call look out for -- that we should look for with your partners as far as first deals or first sizable important strategic deals that we might look for from some of your commercial partners, either in ag or otherwise? Thanks.

Question: Ryan Koontz - Needham & Company, LLC - Analyst : That's really great. And on that new platform you're announcing here, where are we in that roadmap of having a product that the sectors or customer verticals you're chasing after that you feel that platform is fully featured enough to be widely adopted? Do you feel like we're there with this first version one or is this a roadmap where -- go ahead.

Question: Ryan Koontz - Needham & Company, LLC - Analyst : Got it. Super. And just a quick clarification on your UK announcement. Is this for -- again, is this for a platform partner that it will be a channel for you or is this a contract win for this customer to share your data with their customers? I'm a little confused as to the structure of the deal.

Question: Ryan Koontz - Needham & Company, LLC - Analyst : Got it. All right, that's all I have. Thanks so much.

Question: Jeff Van Rhee - Craig-Hallum Capital Group LLC - Analyst : Great, thanks. Just a couple of cleanups for me. Ashley, on the gross margin, obviously, considerably better than you expected, given you guided most of the way through the quarter. What changed? I wasn't clear how that came in so much better.

Question: Jeff Van Rhee - Craig-Hallum Capital Group LLC - Analyst : Okay. And on ag if I could, would you say that the challenges in ag are more macro related or go to market friction related?

Question: Jeff Van Rhee - Craig-Hallum Capital Group LLC - Analyst : Okay, great. I'll leave it there. Thank you.

Question: Edison Yu - Deutsche Bank AG - Analyst : Hey, thank you for taking our questions. One, to come back to AI. I know it's a big buzzword right now. Everyone's talking about it, all the valuations, I'm sure you've noticed have been popping on it. How do we think about the end game for you guys of where you want to get to? Is it Queryable Earth demo you showed before? And if that is the ultimate goal, what are we missing or what do we need to happen to get there? Is it more faster, cheaper compute? Is it better algos? What's the -- what do we kind of need to do to get to that end state?

Question: Edison Yu - Deutsche Bank AG - Analyst : Understood. Appreciate the color. And one on the financials. I know you're not giving full-year guidance, but just directionally, should we think about the second half growth trajectory at the very least increasing or is there any -- I realize this could be a wide range of outcomes but just any kind of directional color on the second half growth?

Question: Edison Yu - Deutsche Bank AG - Analyst : That's great. Appreciate it. Thank you.

Question: Mike Latimore - Northland Securities, Inc. - Analyst : Great. Just on EOCL, can you clarify the amount you're getting on this renewal? Is the next 12 months from EOCL similar to prior 12 months? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, PL.N - Q1 2025 Planet Labs PBC Earnings Call

Question: Mike Latimore - Northland Securities, Inc. - Analyst : Okay, thanks. And on the AI pilots, sounds like they were successful you concluded them. Is the next step looking for more pilots with the same customer or is it potential commercialization of the use case?

Question: Mike Latimore - Northland Securities, Inc. - Analyst : Great. And then a pilot, how long does a seven-figure pilot typically last?

Question: Mike Latimore - Northland Securities, Inc. - Analyst : Yeah. Great. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 06, 2024 / 9:00PM, PL.N - Q1 2025 Planet Labs PBC Earnings Call