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Firefly Aerospace (FLY) delivered a mixed Q2 report in its first earnings release since its successful August 7 IPO, with a strong backlog and NASA momentum overshadowed by a much wider-than-expected loss and underwhelming FY25 revenue guidance.

• The company posted a much larger-than-anticipated loss of $(5.78) per share, triggering a steep post-earnings sell-off that pushed shares below the $45 IPO price.
• FY25 revenue guidance of $133-$145 mln was merely in line with expectations and failed to justify the stock’s rich valuation following yesterday’s run-up.
• Adjusted EBITDA came in at $(47.9) mln, essentially flat yr/yr, reflecting continued investment in infrastructure, R&D, and mission readiness.
• Key drivers of unprofitability include higher launch vehicle development costs, increased headcount, and lunar operations scaling.
• FLY did announce a $10 mln contract addendum under NASA’s Commercial Lunar Payload Services program for Blue Ghost Mission 1. This contract extension, related to science and operational data collection beyond the original scope, helped spark a pre-earnings rally.
• Backlog grew to approximately $1.3 bln as of Q2-end, driven by new awards and momentum behind the Blue Ghost missions, with continued traction from partnerships with NASA, Northrop Grumman (NOC), and Lockheed Martin (LMT).

Briefing.com Analyst Insight:

FLY is still in the early innings of commercialization and scaling, which explains its steep losses -- but investors were clearly caught off guard by the magnitude of the miss. While the CLPS award extension and a $1.3 bln backlog underscore strong long-term potential, especially with marquee partners like NASA and LMT, today’s sharp sell-off reflects the tension between near-term financials and the long-term growth narrative. With the FY25 outlook failing to surprise to the upside and profitability still likely years away, FLY will need to consistently execute on future missions to maintain investor confidence. For now, the stock’s valuation premium (P/S of about 46x) appears difficult to defend.