Rocket Lab Secures Major Defense Contract Amid Flawless Launch Record

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Rocket Lab USA, the American aerospace manufacturer, has capped off 2025 with a landmark achievement, positioning itself as a formidable force in the defense sector. A significant contract award combined with an impeccable operational performance has fueled a substantial re-rating of the company's shares by market analysts.

In a decisive move for its defense business, Rocket Lab was selected on December 19, 2025, to construct 18 satellites for the Space Development Agency’s (SDA) Tracking Layer Tranche 3 (TRKT3). This constellation is designed to detect hypersonic threats, representing a strategically vital capability for U.S. national defense.

The contract carries a base value of $806 million, with additional options. This award, coupled with a prior $515 million SDA contract, elevates Rocket Lab’s total backlog from the agency to over $1.3 billion. A critical detail of this deal is the company's role as the prime contractor, marking a shift beyond its established identity as a launch provider or subsystem supplier.

Operational Excellence Underpins Confidence

The company’s technical execution has solidified the market’s growing trust. On December 21, 2025, Rocket Lab successfully deployed the QPS-SAR-15 satellite into orbit, completing its final scheduled Electron mission for the year. This launch marked the 21st consecutive successful flight in 2025, achieving a rare 100% success rate in an industry frequently challenged by delays and failures.

The demonstrated reliability and high launch tempo of the Electron rocket provide a distinct competitive edge for commercial clients. This consistent performance stands in contrast to the technical hurdles and schedule slips often faced by competitors.

Financial Community Reacts with Upgraded Targets

These developments have prompted a wave of positive reassessments from financial institutions. Needham analysts raised their price target to $90, which stands as the most bullish forecast among covering brokerages. Rocket Lab’s current market capitalization of approximately $37.7 billion reflects heightened expectations for its space systems division and the forthcoming Neutron rocket program.

The company’s evolution from a specialized launch provider to a fully integrated aerospace and defense entity appears complete. With the cornerstone SDA contract and an unblemished launch record, Rocket Lab has established a robust foundation for its next growth phase. The notable share price volatility following its recent rally, however, indicates that some investors are opting to realize profits.