Greetings, and welcome to the Rocket Lab First Half twenty twenty one Earnings Conference Call. As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Gideon Massey, Finance, Planning and Analyst Manager. Thank you, sir. You may begin.
Thank you, operator. Good afternoon, everyone, and thank you for joining us on today's conference call to discuss Rocket Lab's First Half twenty twenty one Financial Results. Today's call is being hosted by Peter Beck, Founder and CEO And Adam Spice, Chief Financial Officer. After our prepared comments, we will take questions. Our comments today include forward looking statements within the meaning of applicable security laws, including statements relating to our guidance for 3rd and 4th quarter 2021 revenue.
Revenue growth expectations in our principal target markets, GAAP and non GAAP gross margin, GAAP and non GAAP operating expenses, tax expenses and effective tax rate and interest and other expense. In addition, we will make forward looking statements related to trend, opportunities and uncertainties in various products In geographic markets, including without limitation, statements concerning opportunities arising from our Launch are dependent on a limited number of customers, average selling price trends and risks that our market and growth More information on these and other risks may affect the forward looking statements is outlined in the Risk Factors section of our recent SEC filing, statements presented on a basis consistent with GAAP will disclose certain non GAAP financial measures, including gross margin and operating expenses. Other non reoccurring interest and other income expense, net attributable to acquisitions and non cash income tax benefits and expenses. We also supplement our unaudited historical statements and forward looking guidance with the measure of adjusted EBITDA, foreign exchange gains or losses, other non operating income and loss excluding interest expense related to debt and other non reoccurring gains or losses. We encourage investors to review the detailed reconciliation of our GAAP and non GAAP presentations in our investor updated available on our website.
We do not provide a reconciliation of non GAAP guidance for future periods because of the inherent uncertainty associated with our ability to project certain future charges, including Stock based compensation and its associated tax effects and the effects of warrant expense related to customers and partners. Non GAAP financial measures discussed today are not in accordance with and do not serve as an alternative for the presentation of Rocket Lab's GAAP Financial Results. We are providing this information to enable investors to perform more meaningful comparisons of our operating results In a manner similar to management's analysis of our business. We believe that these non GAAP measures have limitations and that they do not reflect All of the amounts associated with our GAAP results of operation. These non GAAP measures should only be viewed in conjunction with corresponding GAAP measures.
Lastly, this call is also being webcast with a supporting presentation and a replay and copy of the presentation will be available on our website for 2 weeks. Now let me turn the call over to Peter Beck, Founder and CEO.
Thank you very much, Gideon, and thank you for joining us today as we review Rocket Lab's business highlights and financial results for the first half of twenty twenty. I founded Rocket Lab in 2,006 with a vision to unlock the potential of space and it's a Pleasure to be joining you today and sharing details on just exactly how we're doing that. I'm joined by our Chief Financial Officer, Adam Spice. Adam has served as are CFO since May 2018. Prior to joining the Rocket Lab team, Adam was the Vice President and Chief Financial Officer at Today, we'll be talking you through a brief introduction of in Rocket Lab's business followed by our key accomplishments for the first half of twenty twenty one.
We'll be covering our financial highlights and outlook, sharing our up and coming conference schedule and will leave time for questions and answers. So let me first open with a quick overview of Rocket Lab. We're a vertically integrated end to end space company spanning launch services and spacecraft manufacturing with a vision to move into space applications, perhaps We design, manufacture and launch the Electron Rocket, which has been flying since 2017. This has made us the 2nd most frequently launched U. S.
Rocket for the past 2 years behind only SpaceX's Falcon 9. We have 3 launch pads, including 1 operational pad and another nearing completion in New Zealand. The 3rd The 3rd in Virginia is scheduled to be operational in the coming months pending NASA certification. Beyond launch, we design, manufacture and operate spacecraft, 2 of which have been launched and operating in orbit right now. Our photon spacecraft has been selected by NASA for mission to the moon, to Mars and has been selected by commercial satellite operators for missions in low earth orbit.
Operating as a launch provider and spacecraft manufacturer, we have unique insight into the industry, particularly across supply chains. Something that became quickly apparent to us was that while small satellite industry was growing, it was constrained by satellite As typically these products have been produced in small quantity and are hugely expensive and require ordering sometimes years in advance. So we've set out to change that by producing what we consider best in class spacecraft components at scale, a capability we strengthened with the acquisition of Sinclair InterPlanetary in 20 So with that brief overview of the Rocket Lab story to date, let me take you through some of the achievements for the first half of this year. This year, we started off strong with 3 Elektron launches in the first half, which saw us hit our milestone 20th Elektron launch to date. We managed to launch twice in the same period last year, so we've increased our launch cadence by 50% for the first half of twenty twenty one.
Across these missions, we reached another key milestone deploying 100 satellite to orbit. We've actually now exceeded that and are sitting at 105 satellites deployed to orbit for are participating in our customers across government and commercial markets, plus 2 of our own Photon spacecraft as well. It was on this 20th launch that we successfully recovered Elektron's first stage booster via Ocean Splash Down after launch. The first half of this year also registered significant growth in backlog with June 30 will be available to the 2021 backlog of $141,000,000 June 30, 2020 backlog of 59,900,000 This is underpinned by several significant new electron launch contracts, including a 5 launch deal with BlackSky Global to support their constellation growth as well has a new launch contract with General Atomics. We continue to see strong growth from government customers too with new launch contract awarded for a dedicated launch for the U.
S. Government, for commercial sensitivity and security reasons, several of our commercial and government customers do wish to remain undisclosed at this point. We also saw strong growth on the Space Systems side. We were awarded a contract to design and build 3 photon spacecraft for Varda are in the space manufacturing company. We are awarded a study to develop 2 Photon spacecraft for NASA's Escapade mission to Mars.
In addition to Photon's contracts, we secured new deals for satellite components across a number of large undisclosed customers. And of course, in the first half of twenty twenty one, we had a big milestone by entering into the merger agreement with the Spektaq Acquisition Corporation being a journey to become a publicly traded company listed on the NASDAQ. In anticipation to our public listening, we also welcomed New Board members, Melene, John and Alex, we're proud and excited to have them on the team as we embark on this new chapter. On the R and D side, we announced plans to develop a new 8 ton payload class rocket called Neutron, Where Electron solved the challenge of dedicated responsible launch for small satellites, Neutron will provide a right sized solution for launching the constellations of the in the future. Since announcing plans in March, we've continued to make great progress and look forward to sharing a detailed development update in the coming months.
That provides a brief snapshot of the highlights of the first half, but I'd like to also touch briefly on some of our key achievements On July 29, we successfully launched our 21st Electron mission, are dedicated launch for the United States Space Force. This is a second mission under the Space Test Program, the first taking place in May 2019. So we're proud to have delivered a mission success for our government customers once again. As is often the case with government customers, pinpoint accuracy and orbital deployment are participating in the replay again and again. Beyond launch activity, from June 30 to August 31, we continue to grow our backlog to $174,000,000 This is underpinned by launch contracts with commercial satellite operators, including Aurora Propulsion Technologies, Alba Orbital, as well as a number of undisclosed commercial and government customers across launch and space systems.
Contributing to this is another multi launch deal. Just today, we announced that Rocket Lab has been awarded a 5 launch contract with Kness to deliver 25 satellites to orbit with the Elektron from 2023. This represents are at higher constellation and really cements Electron's value proposition of putting our customers in control of their missions. By launching on Electron, Kness has much more control over their launch schedule orbital parameters as well as that pinpoint deployment accuracy that is provided by the kick stage. On the Space Systems side, we recently announced that construction is underway of a new production line for reaction wheels, a are in the range of 20.20 1.
As mentioned earlier, satellite components have typically been produced in small numbers, which has really limited the speed and scale of constellation development. Participants. The line has been built to solve that, enabling production at scale to meet the growing needs of the customers and the industry at large. And of course, one of the key achievements of the year so far has been the successful closure of our merger with Vector Acquisition Corporation. As of 25th August, Rocket Lab is a publicly traded company on the NASDAQ.
The transaction saw Rocket Lab receive $777,000,000 in gross proceeds. We also saw a tremendously low redemption rate of just 3% on publicly traded VACQ are due to some of the most restrictive COVID-nineteen measures globally, including our current stay at home orders, which prevent launch operations from taking place. In addition, New Zealand's strict international border restrictions have created delays. However, we have been successful in securing our customers' entry into New Zealand so far. Indications are that the current lockdown restrictions may ease by the end of with the Delta cases dropping in New Zealand, but of this are joining us today and I will now turn the call over to Mr.
Vice, Chief Financial Officer.
Thanks, Pete. I will first review our first half twenty twenty one results and then further discuss our outlook for Q3 provide color around our Q4 twenty twenty one revenue outlook. Our first half twenty twenty one results highlight revenues of 29,500,000 are participating in the call, representing year on year growth of 2 37% and GAAP and non GAAP gross margins of 13% and 23%, respectively. Specifically, Launch Services revenue grew 185 percent and stood at $24,100,000 or 82 percent of total revenue and Space Systems contributed $5,400,000 or 18 percent of total revenue. Space Systems grew dramatically off a small base year on year to $5,400,000 from approximately $300,000 as the period benefited from the combination of full period contribution from the acquisition of Sinclair Interplanetary closed in April 2020.
Overall strong growth in shipments for reaction wheels and star trackers as well as contribution for our broader space systems initiatives, are in the range of 16% and 16% of revenue, respectively. This compares to GAAP and non GAAP gross margins of negative 67% and negative 59%, respectively in the first half of twenty twenty. Expansion both GAAP and non GAAP gross margins were largely the result of increases in Elektron build rate and launch cadence and the related effects on launch and production overhead cost absorption as well as the mix effect 2021 is primarily driven by $600,000 of stock based compensation and $100,000 of acquisition related intangible asset amortization. GAAP operating expenses for the first half of twenty twenty one were $29,300,000 up $11,900,000 versus the first half of twenty twenty, with 80% of the OpEx increased spending attributable to R and D targeted at further developing TAM expanding technical capabilities. GAAP R and D expenses of $15,600,000 included stock based compensation of $1,000,000 and amortization of purchased intangibles of approximately 7 are in the range of $100,000 yielding $13,900,000 of non GAAP operating expense for the first half of twenty twenty one.
The previously referenced targeted investments in R and D spend that stepped up $9,500,000 were driven largely by increased staffing and productivity expenses related to our space are in the range of $1,000,000 and $1,000,000 and $1,000,000 and the initial spend on our recently announced Neutron launch vehicle. GAAP SG and A expense of $13,700,000 included stock based compensation of $800,000 and amortization of purchased intangibles of approximately $50,000 yielding $12,800,000 of non GAAP SG and A expense for the first half of twenty twenty one. Are in the market, partially offset by reductions in facilities and other related overhead expenses. Our cash flow consumed from operating activities in the first half of twenty twenty one was $36,600,000 which reflects an increase of cash consumed of 24 point $5,000,000 versus the first half of twenty twenty. This increase was largely driven by a $9,100,000 larger net loss combined with a $13,800,000 increase in accounts receivable due to the lengthening payment terms extended to a strategic customer undergoing a protracted financing process, which is now nearing its conclusion and an increase in inventory of $5,300,000 Offset somewhat by $5,500,000 in non cash expense associated with preferred stock warrants.
Cash flow consumed from operating activities was $5,700,000 in the first half of twenty twenty one compared to cash consumed of $27,800,000 in first half of twenty twenty, with the year on year period reduction in cash consumed driven by several large capital projects that were consuming cash in the first half of twenty twenty related to the acquisition of Sinclair and Air Planetarium in April 2020. The combination of cash consumed from operating and investing activities was more than offset by the $97,400,000 net cash generated from the financing activities in the period, resulting in $109,000,000 in cash and cash equivalents and restricted cash As of June 30, 2021, an increase of $30,900,000 versus the prior ending period June 30, 2020. Subsequent to the June 30, 2021 period, we completed the de stacked transaction with Vector Acquisition Corporation on August 25, resulting in $777,000,000 in gross proceeds from a combination of a $467,000,000 pipe and $310,000,000 from Vector Acquisition Corporation's Continued investments targeted at expanding our total addressable market for strategic space systems solutions. With that, let's turn to our guidance for Q3 2021. We currently expect revenue in the Q3 of 2021 to be approximately $4,000,000 to $5,000,000 We expect Q3 2021 GAAP and non GAAP gross margins of negative 2 21% and negative 52%, respectively.
These negative gross margins are a product of the significantly lower production and launch volumes forecasted in the quarter and related unabsorbed production and launch period resulting from New Zealand COVID level 4 restrictions referenced earlier on the call. We believe our high degree of vertical integration is very strategic and a key factor enabling future operating leverage. However, in periods such as this, vertical integration can have the opposite effect. As production and launch activities resume, we expect gross margins to recover accordingly. We expect Q3 2021 GAAP operating participants are participating in the range of $41,000,000 to $43,000,000 and non GAAP operating expenses of $18,000,000 to $20,000,000 As we continue to fund strategic development programs targeted at delivering strong top line growth in 2021 and beyond across launch and space systems and We expect Q3 2021 GAAP and non GAAP interest expense to be $3,400,000 Given the requirement to fair market value of the Vector Acquisition Corp.
Public and private warrants and Rocket Lab customer and partner warrants based on the end of quarter stock price, We cannot estimate these below the line GAAP other income and expense items at this time, nor are we able to forecast foreign exchange gains or losses. We expect Q3 2021 adjusted EBITDA loss to range between $17,000,000 $20,000,000 Our manifest for the remainder of the year remains strong, which supports demand for more than $40,000,000 of revenue in the 4th quarter. Given the uncertainty of COVID restriction in New Zealand, however, we are judging our 4th quarter revenue forecast to range between $17,000,000 $20,000,000 This assumes the COVID-nineteen restrictions ease prior to the end of September, allowing our launch services to resume. This revenue guidance of $4,000,000 to $5,000,000 for Q3 and $17,000,000 to $20,000,000 for Q4, when combined with our first half in the books, are encouraged to forecast in a very uncertain time with regards to COVID restrictions in New Zealand. To this end, the estimate for 4th quarter revenue assumes modest sequential growth in Space Systems are not perishable, but rather just the timing of execution against these binding contractual launch services agreements.
So in closing, despite near term challenges presented by COVID restrictions primarily affecting our Launch Services business, we are very encouraged by the progress made against key strategic programs and expansion initiatives and particularly by the continued expansion in our backlog. And with that, I'd like to open up the call for questions.
The first question is from the line of Edison Yu with Deutsche Bank. You may proceed.
Thanks for taking the questions and congratulations on the Q1 out. Just had a couple of things I wanted to ask. 1 For near term, another thing kind of farther out. Realize that you're being a bit conservative on the launch cadence due to COVID. Could you maybe go over what's the potential to maybe make that up in like the first half of twenty twenty two, given you clearly have the capacity to?
Is it still possible to kind of get those launches and maybe in the Q1 of 2022? Curious about that. And then the second thing, a bit more longer term. It seems like the pace of announcements of wins has really accelerated, I would say, in the last few months. Could you maybe go over again the pipeline that you've outlined in the past?
Is that also expanding across the various verticals that you're playing in? I'm just curious, it just seems participants The pace of wins has really accelerated. Thanks.
Adam, I can I'll take a couple of these and add any color that you wish to it. With respect to can we make up The manifest, obviously, we are provided we can produce launch vehicles, participants. Then we can push those out to the pad pretty quickly. Operating our own private orbital launch range gives us A huge amount of flexibility to manage the manifest. We're not subject to any other launch vehicles scheduling constraint.
So That puts us in a good position to make those up and control that. With respect to the pipeline expanding, The pipeline does continue to expand and we continue to see growth in the pipeline and opportunities thereof.
Yes. I'll jump in, Allison. I think when it comes to the catch up sorry, go ahead.
No, go ahead. Go ahead. I had a follow-up.
Sorry. Go ahead and ask your follow-up and then I'll follow-up to join in after.
Yes. I was also going
to say is, I guess, I assume 4Q doesn't include any launches out of Wallops, right? I was just going to make sure.
Okay, Pete, I'll take that. So yes, currently right now, we don't have Any launches scheduled on the manifest for Q4 out of Wallops. As we've discussed in the past, We're really awaiting the final certification of our automated flight termination system. We're waiting on NASA's software to be certified on our hardware. So until that happens, we're unable to launch out of wall.
So we've also there's a targeted date of having that operational by the end of the year, Whether we could get a launch off within that kind of towards the very end of the year is a question.
Pete, do you want
to provide any color?
That's exactly right, Adam. The Launchpad is complete and it's commissioned. We're just waiting on this to complete that
And then, Edson, I'll jump back on to the question as far as catching up Q1. I would say that we're certainly not throwing in participants are now on Q4 and supporting as many of the launches, those 5 launches that we have on the manifest. It was just really out of, I would say, being prudent and conservative with regards to forecasting are participating for the financial community what we're willing to sign up for and commit to. This is not at all an indication that we are changing our manifest or not kind of still doing everything we can to execute to that, but I think it was just prudently cautious of us to put a lower financial commitment out there. But again, I want to make sure that people don't confuse that with what actually exists on the manifest and what ultimately the bogey would be.
Participants And then I would follow on the other question as far as the pipeline pace and so forth. I would agree, We're seeing a lot of diversity in the pipeline across launch, across government, across commercial. And then I think even more specifically probably on the space system side is where we're seeing a tremendous amount of strength and where we're getting a lot of diversity building in the business. To me that's probably the most encouraging because I think having that diversity of the business allows us To deal with some of the lumpiness that's natural in the launch business, right. Launches can be affected by weather, they can be affected by a lot of things, whereas you get this diversified portfolio of space systems business across Components, satellite build, design services, on orbit, operational management contracts and so forth, I mean that really does provide a nice got a diversified stable base in which you can build your business.
So we're very, very excited about that particular part of the growth in our pipeline.
Great. That's great color. If I could just sneak one more Any sort of updates on Neutron? I know you said that you'll give more details in the coming months. Curious what's maybe some reactions from Potential customers, the progress, is everything kind of on track timing wise?
Just anything there?
Yes, sure. New Neutron continues to develop really well. And we're just we're spending our time participants are getting through tremendous amount of work and holding our cards a little bit close to our chest. Look, Neutron is a vehicle that is not kind of an increment on electron. It is something that really sets a new standard within the space industry in our view.
So we're going to do a really significant announcement about that here in the coming months where we'll expose a lot more of its details. But at the moment, we'd like to just keep our head down in working super hard and getting through a large portion of the vehicle design and con ops. I don't think anybody will be disappointed with the when we reveal more information.
Thanks, Emily.
Thank you, Mr. Yu. The next question is from the line of Cai von Rumohr with Cowen. You may proceed.
Yes. Thank you very much. So You raised a lot of money. It looks like more than you need for Neutron and until you reach cash breakeven. And I think you've talked of sort of inorganic growth.
Can you give us a little bit of color of what the M and A pipeline looks like? And participants. What are you looking for in terms of size of deals and when might we see a transaction? Thanks so much.
Sure. I mean, your point is exactly correct. We've ensured that we would have have sufficient dry powder to really expand the TAM. And it's fair to say that the kind of acquisitions we're looking for and have been pursuing ones that really grow our position very strategically. So obviously, you've seen the value of the I think it's a little bit early
Sure. Yes. No, I think that what's interesting about this market right now is it does really feel like it's ripe for consolidation and Not consolidation in the sense of large companies necessarily getting together, but the fact that the investability of space is a relatively new phenomenon. For quite some time, it was very difficult to raise private capital in this market. So there's a lot of mom and pop or bootstrap companies Where they are founder controlled, really nice businesses though, businesses that are reasonably integratable, they are digestible from that perspective.
Also, they tend to have had a focus on profitability. So you're not picking up what are typically kind of venture found venture funded Cash burning operations. So we're actually seeing quite a bit of opportunity and we always have in our pipeline a half dozen or so deals that we're actively investigating or trying to progress. So I definitely think that the outlook looks good for us landing transactions. I think as Pete mentioned earlier, the Sinclair Acquisition has really emboldened us to lean forward and look at opportunities.
And fortunately, we're also finding that when we have discussions with companies, They seem to really want to be part of this platform, right. So I think that's in my experience inquiring engineering oriented companies, participants. Engineers are drawn to other great engineers and that's one thing that we really have to offer here at Rocket Lab is a great platform with great engineers and kind of when you have those Engineer to engineer conversations, you really start to get a mind meld and you get a sense that people would really want to be part of the true operating company And one that's got a leading platform that they can ultimately get their products to market. So I think that we're not seeing and we're really not looking at what we would consider to be large deals. We're really looking more participants are in the range across the breadth of the market, but primarily on the space system side.
Obviously, all participants. That's where the majority of the opportunity is because we believe we've got launch pretty well in hand obviously with Electron and now with Neutron. And there might be some technologies that we kind of add to the portfolio on that side of the house as well, but the focus is really disproportionately on the space system side and building out Our footprint in that ecosystem in a prudent way, but also in a way that I think just fits the model and will kind of deliver the type of business profile that we've been articulate to investors thus far.
Thank you very much. And as a follow on pricing, I think you've mentioned that you have a couple of Planet launches that you signed up for in 2015 that basically have lower prices. What is the recent trend in pricing both with respect to what you're able to get now that you're kind of more proven and what you're seeing from competition given those guys basically have yet to prove themselves, but obviously they like to have business.
So at the end of the day, Our customers value a couple of things more than anything else. They value reliability and not just reliability of the launch vehicle, Reliability of the schedule and just a proven service. So we haven't seen pricing eroded and Customers understand the value that a reliable dedicated small launch provides. So I would participants We really haven't seen really any kind of issues there.
Yes. I'll add a little more color this evening. Sorry, go ahead, Kai.
No, I was just saying, have you seen any improvement in pricing now that you've kind of done more satellites?
I would say that we've seen stability in our pricing. Certainly since I joined, I joined in May of 2018 And the pricing that we were talking about at that point in time was considerably lower than it is today. So pricing has actually gone up for us. And I think a lot of Perhaps would have predicted that not to be the case, but certainly has developed to be that. And I think what we're seeing what's helping that stability and pricing is effective.
We're bringing more and just launch, I don't want to minimize launch, launch is incredibly complex and we believe the keys to playing in space overall. But Photon has really been a huge, I would say, complement to our launch business, right, where When you can offer a customer a complete turnkey solution where all they can all they need really to focus on is the data, which is really what they want from the are coming to them with a combined launch plus Photon solution is incredibly powerful and that allows us to have again a lot more I would say control over pricing because we're really not dealing with other competitors out there that have that same suite of offerings. So, we feel that's really been helpful to provide support for pricing and for this not to really get too affected by others. And of course, the other thing on pricing too is A lot of people can be out there talking about launches, but we're one of the few that's actually putting assets on orbit on a predictable And frequent basis, so that helps as well. And then also what we're seeing, I think, develop is that multi launch deals have come forward.
So we talked about the Canasta earlier today. I I think we really are starting to see, I think, proof that the new space LEO market is really starting to take off and you start to see these multi launch commitments. And that's something that's really, I'd say kind of evidenced itself in the last, I'd say, 6 to 12 months, and we're again starting to see more and more kind of momentum along those lines. So less of the kind of one off bespoke launchers agreements and more for multi launch, which is very encouraging.
Participants Thank you
very much.
I think satellite operators also understand the value of small dedicated launch on a reliable platform, whereas prior, it was Less obvious, but as more and more customers are flying with us and they see the value then, I think that certainly helped with that as well.
Yes. I think, Kai, I think one of the things that really helps too on the pricing stability is heritage, right? So, as Pete mentioned, having hit the milestones we have as far as the number of launches, 21 launches, that's significant, right? That's differentiated in the marketplace. Think people now as they get really serious about putting their assets in orbit, they want to go with somebody who's proven they can do it and they can do it reliably repeatedly.
So All those things have kind of factored in to provide a what we see as a pretty stable environment for pricing.
Thank you. Thank you, Mr. Von Rumohr. The next question is from the line of Suji
I want to dig into your comments on the component strategy and the gross margin that it can be negatively impacted during times like this and then Rebound, is that a strategic difference for you guys versus competitors and financially? And help us understand which components you try to bring in source and in house and which ones You don't, but how you kind of draw that line?
Yes. I mean, the launch business is always a fairly lumpy business because At the end of the day, as a launch provider, you're always subject to spacecraft readiness and customer readiness. So launch is always a lumpy business. And our decision to move into Space Systems It wasn't something that we did consciously recently. It was something that was baked into the plan from day 1.
If you look at the very second rocket that we launched, the kick stage that we put in orbit had recesses for solar panels right back on launch 2. So our view on really providing an end to end space company has been foundational from day 1. And when you're going to be that interim space company, components or satellite components actually form a really fundamental layer and an important differentiator between you and others. Because as we found out participants Very quickly, when we started to order satellite components, the lead times were just too long. Like, we don't have 9 to 12 months to wait for a reaction.
So after kind of experiencing that in our own satellite program, we kind of understood the rest of the industry and the rest of the market. And The satellite industry is kind of bounded by the fact that you have, as Adam mentioned, a number of small shops Everybody's head just explodes. So if the space industry and satellite constellations are going scale at the rate that everybody predicts, then this problem has to be solved. And the one thing that we're super good at as a company is producing really complex in the volume and space components of volume. So our strategy here is obviously provide components into our own platforms, but also into others and really help support and jolly along the growth of the satellite and the large constellations in general.
And you can can see that with an example of that obviously with the Sinclair deal where we're now supplying not 100, but up to 1,000 reaction wheels into a variety of platforms. Okay. And then on
the launch cadence and the push outs here, I'm wondering if that has any impact on the timing of when you expect Space services, if you would, revenue to come in. I presume you have some learnings and testing there before you monetize that. Does the launch push out in New Zealand push that back or is a lot of that already in place to hit your targets for that flowing into revenue in a few years?
Yes. No, I mean, this impact won't affect those future plans. I mean, The launch manifest gets moved around all of the time. It's very like I say, we're always subject to So it all gets thrown in there. And like I say, the biggest influence that we have is actually earning our own launch range have been able to move those manifests and manage that manifest so that everybody gets off in the shortest time frame.
Thank you, Mr. DeSilva. The next question is from the line of Austin Moeller with Canaccord Genuity. You may proceed.
Hi, good afternoon.
Hi, Austin.
Just to go ahead with my first Question here. If we think about the Space Systems segment, where do you foresee in terms of revenue mix, the ultimate breakout are being in the next few years in terms of the sales of the Photon satellite bus versus the sales of the components.
Yes, I can provide a little bit of color. No, go ahead, You go, Adam. You go, Adam. Yes. So Austin, if you look at the breakout, right now, certainly components is a little bit larger because it had a bit of a, I would say, a little bit more of a running start from the acquisition of Sinclair.
But when we look at our The overall contribution in 2021, it gets to be pretty balanced by the time we're getting out into this Q4 period. So I would say that they both have the opportunity to scale, although my guess would be that components will outstrip The design services and satellite bus and other related functions in space systems for probably the next 12 months to perhaps 18 months, but then the opportunities on the broader side of space systems outside of components, both at the satellite bus level and services get to be pretty, pretty large. I would say that there was a question earlier about our pipeline. We have some very, very large opportunities that we're pursuing in our pipeline that are very needle So right now, I'd say the default is that components will be a little bit larger because those kind of opportunities are a little bit further developed and may be a little bit easier quantified, but I think things outside of components more on the full systems side of things, the satellite bus and services side, I think overall, they have an opportunity to scale much more greatly in the longer term once you get out past the kind of 18 to 24 month period.
And with that, I'll let Pete, if you view it any differently.
No, you've exceeded exactly what I was going to say.
Okay, great. And so if we think about potential future acquisitions along the same line of Sinclair. Are you guys envisioning targeting Companies that are more within that larger space system, either satellite bus or services sort of sphere or more components as you
Well, I mean, I'd say we have to be a little bit careful from a participants are not showing too much of a hint competitively, but I would say it's a little bit of certainly a little bit of both.
There are no additional questions waiting at this time. I would like to pass it back to Peter Beck for any additional remarks.
Thank you very much. And before we wrap up the call, I would like to thank everybody who participated in today's call, and we look forward to having the opportunity to provide further updates on our business, including through our participation at Deutsche Bank's Virtual Technology Conference in September 10, participants are in the discussion of the 2020 1 on September 22 and the UBS CEO Disruptive CEO Conference on October 19. Once again, thanks to everybody on the call and have a great rest of your day.
That concludes the Rocket Lab First Half twenty twenty one Earnings Conference Call.