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Rocket Lab Secures Tranche 3 SDA Satellite Agreement
Rocket Lab shares surged at the end of the week after the company secured a major satellite contract from the U.S. Space Development Agency (SDA), extending a rally that began following a successful government rocket launch earlier in the week. The move underscored growing momentum for the space startup as it deepens its role in U.S. defense and national security programs.
On Friday, the SDA announced that Rocket Lab, alongside Lockheed Martin, Northrop Grumman, and L3Harris, had been selected to participate in the latest phase of its missile-tracking satellite initiative. The program is part of the agency’s broader effort to build a resilient, low-Earth-orbit missile defense network through the Proliferated Warfighter Space Architecture (PWSA).
Major Satellite Contract Expands Rocket Lab’s Defense Role
Under the agreement, the four contractors will collectively deliver 72 tracking satellites designed to provide missile warning, tracking, and defense capabilities from low Earth orbit. Each company is responsible for supplying 18 satellites. The combined value of the agreements is approximately $3.5 billion.
According to details released Friday, Rocket Lab’s award includes an $806 million base contract, with additional options valued at up to $10.45 million. The SDA confirmed that Lockheed Martin’s portion could reach $1.1 billion, while Northrop Grumman and L3Harris secured contracts potentially worth $764 million and $843 million, respectively.
The satellites are part of Tracking Layer Tranche 3, a key phase in the SDA’s long-term plan to deploy hundreds of interconnected spacecraft capable of detecting and tracking missile threats globally.
Rocket Lab has prior experience with the program. The company previously won a Tranche 2 award to deliver 18 space vehicles, an agreement with a total value of $515 million. The latest contract significantly expands that relationship.
Cantor analyst Andres Sheppard described the deal as a milestone for the company, writing that Tranche 3 represents Rocket Lab’s largest contract to date and “roughly doubles” its contracted backlog, which stood at about $1.1 billion at the end of the third quarter of 2025.
Successful U.S. Space Force Launch Adds Momentum
The contract news followed a high-profile launch completed early Thursday for the U.S. Space Force. The mission had been expedited at the request of the military and moved up several months from its original schedule.
The launch, dubbed “Don’t Be Such A Square,” lifted off shortly after midnight from Rocket Lab’s launch facility on Wallops Island, Virginia, located off the eastern shore of the Delmarva Peninsula. It marked the company’s 20th successful launch of the year, setting a new annual record.
The Electron rocket carried four small, disk-shaped satellites known as DiskSats into low Earth orbit. Once deployed, the satellites are expected to undergo testing focused on maneuverability and performance in space, according to Rocket Lab.
The successful mission added to a string of recent operational wins. Earlier in the week, Rocket Lab also completed a launch from New Zealand for the Japan Aerospace Exploration Agency (JAXA), further highlighting the company’s growing international footprint.
Market Reaction Reflects Contract and Launch Developments
Following Thursday’s successful Space Force mission, Rocket Lab shares jumped sharply, extending gains into Friday after the SDA contract announcement. The two-day advance followed a period of choppy trading that had seen the stock fluctuate widely around key technical levels.
Earlier in the week, shares briefly dipped when news of the accelerated Space Force launch first emerged, a move that contrasted with the strong reaction that followed once the mission was successfully completed. Market observers noted that some earlier weakness may have reflected short-term profit-taking rather than concerns about Rocket Lab’s fundamentals.
Over the past year, the stock’s performance has been shaped by both rapid advances and sharp pullbacks. After touching a low in the high-30s during a correction phase, shares rebounded strongly, reflecting what many viewed as a reset after an otherwise strong year.
By the end of last week, Rocket Lab shares were approaching their prior record highs reached in mid-October, supported by back-to-back gains and a recovery above key moving averages. The recent rally came as the broader aerospace and defense sector benefited from increased government spending on space-based security infrastructure.
Expanding Role in Space and Defense Infrastructure
The SDA’s Tracking Layer is widely viewed as a cornerstone of future missile defense architecture, relying on redundancy and scale rather than a small number of high-value assets. Rocket Lab’s inclusion alongside long-established defense contractors highlights the company’s evolution from a small-sat launch provider into a more diversified space systems manufacturer.
With both launch cadence and government contracts increasing, Rocket Lab continues to position itself as a key supplier in the growing intersection of commercial space and national defense. The Tranche 3 award adds long-term visibility to its revenue pipeline and reinforces its standing within the U.S. space ecosystem.
