Planet Labs PBC

AP of Investor Relations. Thank you. You may proceed, Chris.

Thanks, Operator. And hello, everyone. This is Chris Genualdi, Vice President of Investor Relations at Planet Labs PBC. Welcome to Planet's fiscal fourth quarter and full year 2024 earnings call. I'm joined today by Will Marshall and Ashley Johnson, who will provide a recap of our results and discuss our current outlook, as well as Kevin Wheel, who is joining us for the Q&A portion of today's call. We encourage everyone to please reference the earnings press release 8K filing and earnings update presentation for today's call, which are available on our investor relations website. Before we begin, we'd like to remind everyone that we may make forward looking statements related to future events or our financial outlook. We reference qualified pipeline, which represents potential sales leads that have not yet executed contracts. For the customer contracts referenced during this call, please note that the revenue figures we cite will generally be recognized over the term of the contract, which can last multiple years. Further, the terms of these contracts can vary, and we may not realize all expected revenue. Any forward-looking statements are based on management's current outlook, plans, estimates, expectations, and projections. The inclusion of such forward-looking information should not be regarded as a representation by a planet that future plans, estimates, or expectations will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions as detailed in our SEC filings, which can be found at www.sec.gov. Our actual results or performance may differ materially from those indicated by such forward-looking statements, and we undertake no responsibility to update such forward-looking statements to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. During the call, we will also discuss historic and forward-looking non-GAAP financial measures, We use these non-GAAP financial measures for financial and operational decision making as a means to evaluate period-to-period comparisons. We believe that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. For more information on the non-GAAP financial measures, please see the reconciliation tables provided in our press release issued earlier this afternoon. Further, throughout this call, we provide a number of key performance indicators used by management and often used by competitors in our industry. These and other key performance indicators are discussed in more detail in our press release and our earnings update presentation, which are intended to accompany our prepared remarks. At this time, I'd now like to turn the call over to Will Marshall and its CEO, chairperson, and co-founder. Over to you, Will.

Thanks, Chris, and hello, everyone. Thanks for joining the call today. Planet delivered a strong fourth quarter to cap off the year. For the full fiscal year 2024, we generated a record $220.7 million in revenue, representing 15% year-on-year growth. Non-GAAP gross margin for the full year was 54%, and adjusted EBITDA loss was $55.3 million. We continue to make progress towards our target of reaching adjusted EBITDA profitability by Q4 of this fiscal year. We also surpassed 1,000 customers during the fourth quarter of fiscal 2024, an exciting milestone for Planet. Growth for the year was led by the government sector. During fiscal 24, our revenue in the defense and intelligence vertical grew over 30% year over year, while revenue in the civil government vertical saw solid growth as well. In the near term, we expect growth will continue to be driven by government sector particularly during the period of heightened security, increased sustainability priorities, and climate risks. In the defense and intelligent market, our business has historically been led by our differentiated high-resolution tasking fleet, a business which continues to grow year over year. However, recently, we've seen increased demand from defense customers for our PlanetScope daily scanning capabilities, particularly when enhanced by AI-enabled partner solutions. While the unique value of our PlanetScope daily scan has always been clear, recent advances in AI are leading to new solutions that extract critical value from our proprietary dataset. We are seeing new scan and search capabilities developed based on our proprietary daily scan, which enable critical applications such as broad area threat monitoring for NASA security purposes. These AI-based solutions help lower customer barriers to entry and speed customer time to value. This shift is just beginning, but we're already starting to see it in our bookings and pipeline. As an example, we were recently awarded a competitive seven-figure ACV contract by the US Navy's Naval Information Warfare Center, NIWC Pacific, for vessel detection and monitoring over key areas throughout the Pacific Ocean. NIWC Pacific will integrate PLANET data and AI capabilities from our partner CIMMAX into their C-Vision platform to help improve maritime domain awareness and support broad area monitoring throughout the region. PLANET is the prime contractor for the award and CIMMAX is a Houston-based satellite analytics and intelligence company whose advanced AI solutions do vessel monitoring and classification. As you may recall, we previously partnered with CIMAX to provide energy and maritime intelligence solutions, and we recently expanded our strategic partnership with CIMAX, increasing the breadth of opportunities we can pursue together, and we're already seeing demand from other governments for our combined capabilities. Additionally, we have multiple seven-figure pilot programs in flight or in procurement with forward-leaning defense agencies, which, if successful, have the potential to scale significantly. Similar to the NIWC Pacific Award, these pilots include AI-based partner solutions sold alongside their data, enabling broad area monitoring applications. These pilots are primarily focused on monitoring land-based locations. This is part of a growing trend that signals increased customer interest in purchasing insights with our data. We are pursuing many of these large pilots this year. I'll turn now to the civil government vertical, where we are also seeing solid traction for solutions sold alongside our data. Solutions for this vertical include those built by customers leveraging our internally developed planetary variables product line, as well as solutions developed by partners. In Q4, we closed over 50 new and expansion opportunities in the quarter, with governments ranging from large federal agencies to state and local governments, which is more civil government opportunities than in any quarter during fiscal 24th. Recent wins include an expansion with Bolivia's Institute of National Agrarian Reform, which is expanding its use of planetary variables and our Sentinel Hub platform to manage public land and enforce property titling regulations, and an expansion with the Ministry of Natural Resources and Environmental Sustainability of Malaysia, which is using PlanetScope and SkySat data to monitor large forested areas for policy planning and management purposes. As you recall from our investor day last week, October, the civil government market makes up a significant portion of the six-figure opportunities and the majority of the seven-figure opportunities in our qualified pipeline. It's a large and reliable stream of opportunities for our sales team to close. As we previously shared, the ROI for civil government customers can be many multiples greater than their investment in our data, such as the Indian state of Odisha, which saved over $200 million through fraud elimination in their first year, and Brazil's government, which has collected billions of dollars in fines, seized goods and assets, frozen, aided by plant's data. With both in-house and partner-developed solutions, as well as Sentinel Hub's platform capabilities, we see opportunity to unlock additional segments of the civil government market by speeding time to value and driving expansions with existing customers looking to enhance their ability to manage broad areas of land. Shifting to the commercial vertical, during the fourth quarter, we signed expansions with large customers in the agriculture and energy sectors. However, budget constraints and the completion of the large legacy contract, which we've previously discussed on prior calls, resulted in an overall year-over-year decrease in revenue from this vertical. During Q1 of fiscal 25, we will lap the difficult year-over-year comparison, but continue to anticipate that the commercial market will be slower to develop based on budgetary constraints, particularly in the ag sector. Our strategy for the commercial sector is centered around partner-led opportunities and our efficient platform sales. We see strong indications that this is the best way to serve commercial customers and grow the addressable market for our solutions. To highlight some of our recent wins in the commercial sector, we closed a three-year expansion with Swiss Re. Swiss Re continues to be a great partner and we're proud of how our relationship is growing. The expansion adds planets land surface temperature planetary variable to swiss reese tool belt in addition to our soil water content planetary variable that which they already use these tools support swiss reese parametric insurance products by feeding pricing models validating claims and credit forecasting potential risk and identifying opportunities within new markets We also closed a large new multi-year deal with an agriculture-focused insurance company in Canada, which is leveraging Planet's broad area monitoring solutions and planetary variables to modernize its drought insurance program and for crop insurance claim validation. We also announced that PlanetScape data is now available on Google Cloud Marketplace, allowing GCP's existing customers to purchase Planet data using GCP credits so that they can easily onboard and analyze, process, and derive meaningful insights from our data at scale. We've already had a customer in the commercial sector make a purchase for a seven-figure renewal through the marketplace. Shifting gears to share a business update that spans across verticals, as you may have seen at the press release this afternoon, we recently signed an eight-figure data license agreement with Carbon Mapper to provide hyperspectral core imagery to the nonprofit and its partners until 2030. As a reminder, Carbon Mapper has been a key partner for Planet in developing the Tanager hyperspectral constellation. This contract is an extension of an existing arrangement, and we would expect revenue under this contract to begin in 2026. Importantly, this agreement demonstrates our shared confidence around the program and our shared mission to improve understanding and accelerate reductions in global methane and carbon dioxide emissions. We continue to expect to launch the first Tanager satellite later this year. Now let me turn to product updates. Our first Pelican tech demo, which we launched in November, continues to perform excellently. The hundreds of system tests that we've conducted over the 10 subsystems of the satellite have gone well. We are gaining valuable on-orbit learnings and making solid progress towards operationalizing the Pelican platform. As we shared previously, our agile aerospace approach with rapid iteration of capabilities in orbit enables fast improvement cycles to our spacecraft designs. We expect to launch additional Pelicans, including the first production satellites, during the next 12 months. Turning now to software and platform updates. Similar to our approach in spacecraft, we practice rapid iteration and constant improvements of our software products as well. We recently launched Field Boundaries Analytics, which is the latest addition to our suite of planetary variable solutions. Field Boundaries provides the spatial context necessary to better understand planted acres for different crop types and growth throughout the agricultural season, enabling more accurate yield estimation for our customers at a global level. We've also recently upgraded our crop biomass planetary variable with PlanetScope data, as well as made meaningful improvements to our road and building detection solution Consistent improvements in our AI-powered analytic solutions are helping make our data more accessible and speed customer time to value. In summary, demand in the government sector is very strong. We are seeing a shift in our business towards selling solutions alongside our data. AI is enabling broad area search atop our unique daily scan and is opening use cases and markets with exciting early traction in the defense and intelligence vertical. We are prioritizing investment behind these areas. I want to emphasize that we remain committed to striking the right balance between growth initiatives and operational discipline so that we can achieve our adjusted EBITDA profitability by Q4 of this year, which is an important milestone on the path to building a high margin, sustainable cash flow generating business. Growth for fiscal 2025 will be driven by closing the large deals in front of us and scaling our platform and solutions partners globally across vertical markets. our product and engineering teams continue to make incredible strides on both our agile space technologies and equally agile software stack. And I couldn't be more excited about the developments here. And there is more to come. We are hosting a milestone platform launch, which will be webcast virtually on April 11th. So I encourage you to tune in. Before I hand the mic over to Ashley, I'd like to discuss the management transition announced earlier today. As we shared, Kevin Wheeler's role is evolving to be an advisor to Planet Labs PBC and a member of the Planet Federal Board, and Ashley will be taking on the role of president. I first want to express my thanks to Kevin, who is here on the call with us today, for all of his impact at Planet, and I look forward to continuing to work with him. I'm very glad that Planet will continue to benefit from his partnership and guidance in this new way. I'd like to congratulate and recognize Ashley here for the expanded role that she'll be taking on at Planet. I'm pleased to share that she will be assuming the responsibilities of leading our go-to-market and business strategy as president and CFO. I'm excited about her taking on this new role because, as you know, Ashley's leadership and depth of experience are an incredible asset to Planet. She has over 20 years of experience scaling technology businesses, driving financial performance, and building operational excellence at global organizations. Her results-driven focus and deep understanding of Planet make her the right person to lead our go-to-market and business execution during this next chapter. Additionally, Robert Cardillo, Chair of Planet Federal and the former head of the National Geospatial Intelligence Agency, who continues to bring a wealth of knowledge, understanding, and relationships in the national security domain, is taking on a larger role overseeing strategy for our defense and intelligence business globally. I'll now turn it over to Ashley for a review of the financials and our outlook. Over to you, Ashley.