Planet Labs PBC(PL) - 2022 Q4 - Annual Report

Part I Business Planet Labs PBC operates the largest Earth observation satellite fleet, providing daily global imaging data and analytics through a cloud-native subscription service - Planet's mission is to image the entire Earth's landmass daily using its fleet of approximately 200 satellites, the largest in history, to make global change visible and actionable[16][17] - The company generates revenue primarily through fixed-price subscription and usage-based licenses for its data and analytics, delivered via a cloud-based platform, allowing each captured image to be sold multiple times[21] - Planet operates as a Delaware public benefit corporation, aligning its business model with its mission to accelerate humanity toward a more sustainable, secure, and prosperous world[22][85] Fiscal Year 2022 Key Metrics | Metric | Value | | :--- | :--- | | Revenue | $131.2 million | | Satellites in Orbit | Approximately 200 | | Customer Count | Over 700 | Industry Overview The Earth Observation industry is shifting to commercial, product-driven data platforms, driven by lower launch costs and technological innovation - The Earth Observation market is projected to grow from approximately $5.5 billion in 2019 to an estimated $19 billion in 2027, driven by lower launch costs and technological innovation[25] - Two key global trends are fueling demand for Earth observation data: the digital transformation of the economy (leveraging data and AI) and the sustainability transformation (focusing on ESG goals and environmental impact)[24][26][27] Our Operations Planet's operations encompass its satellite fleet, global sales, multi-channel marketing, and continuous R&D in software and agile space missions - The company's global sales organization operates directly and through a network of over 250 partners across 72 countries, focusing on acquiring new customers, expanding existing relationships, and ensuring contract renewals[39][40] - R&D efforts are focused on software (AI, machine learning) and agile space missions, including advancing spacecraft technologies and automated operations for its satellite fleet and ground stations[44] - Planet partners with the non-profit Carbon Mapper to build and launch advanced hyperspectral satellites for identifying and tracking methane and CO2 emissions[48] Our Technology Platform Planet's platform uses agile aerospace for rapid satellite deployment, building a vast proprietary data archive accessible via diverse data solutions and analytics - The company pioneers "agile aerospace," applying agile software principles to rapidly develop and deploy compact, powerful satellites at a lower cost than traditional methods[50] - Planet collects over 30 terabytes of Earth data daily, contributing to a deep historical archive used for training AI models and providing unique insights[54] Proprietary Data Solutions | Solution | Description | | :--- | :--- | | Planet Monitoring | Daily imaging of the entire Earth's landmass at up to 3.5m resolution | | Planet Tasking | High-resolution (up to 50cm) rapid revisit capability, capturing a location up to ten times per day | | Planet Archive | Historical data dating back to 2009, with daily global scans since 2017 | Our Growth Strategy Planet's growth strategy focuses on scaling existing verticals, expanding into new markets, investing in data products, building a partner ecosystem, and strategic acquisitions - Scaling in existing verticals by investing in sales, marketing, and software solutions for civil government, agriculture, defense & intelligence, and mapping[72] - Expanding into new verticals like energy, finance, and insurance by making data more accessible to non-geospatial experts and partnering with independent software vendors[73] - Continuing strategic acquisitions to complement existing offerings, following past acquisitions of BlackBridge, Terra Bella, Boundless Spatial, and VanderSat[77] Our Competition Planet competes with both incumbent and next-generation satellite imagery providers, as well as data analytics platforms, some of which are also partners - Competitors in satellite imagery are divided between incumbents (e.g., Airbus, Maxar) with few high-cost satellites and next-generation players (e.g., BlackSky, Satellogic) with smaller, lower-cost satellites[79][80] - The company also competes with data analytics platforms such as Orbital Insights and Descartes Labs, which use geospatial data from various sources, with Planet partnering with some of these companies to provide data for their platforms[81][82] Risk Factors The company faces significant risks from its limited operating history, net losses, market adoption uncertainty, operational failures, cyber-attacks, intense competition, and capital needs - The company has a limited operating history at its current scale and a history of operating losses ($137.1 million in FY2022), making future results difficult to predict and profitability uncertain[108][110] - Market adoption for Planet's unique daily scan data is not guaranteed; if the market fails to grow as expected or customers do not adopt the platform, the business could be harmed[112][113] - Significant operational risks include satellite failures, launch delays or failures, cyber-attacks on infrastructure and data, and potential interruptions from weather or other external factors[123][134][140] - The business is capital-intensive and may require additional financing for its strategies, which may not be available on favorable terms[179] - The multi-class stock structure concentrates over 63% of voting power with the two co-founders, limiting other investors' ability to influence major corporate transactions[232] Properties Planet's corporate headquarters, including satellite manufacturing and R&D, is a 65,000 sq. ft. leased facility in San Francisco, with additional leased offices in Europe and D.C - The corporate headquarters is a ~65,000 sq. ft. leased facility in San Francisco, CA, which houses satellite manufacturing, testing, and R&D[283] - European offices are located in Berlin, Germany and Haarlem, Netherlands, while a Washington, D.C. office serves as the headquarters for Planet Federal[283] Legal Proceedings The company is not a party to any material legal proceedings, though it is involved in ordinary course litigation not expected to have a material adverse impact - The company is not currently a party to any material legal proceedings[285] Mine Safety Disclosures This item is not applicable to the company - Not applicable[286] Part II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Planet's Class A common stock and warrants are listed on the NYSE, with no cash dividends paid or anticipated, as earnings are retained for business growth - Class A common stock and warrants are listed on the New York Stock Exchange under the symbols "PL" and "PL WS," respectively[287] - The company has never declared or paid cash dividends and does not intend to in the foreseeable future, retaining funds for business development and growth[289] - On December 13, 2021, the company issued 1,900,739 shares of Class A common stock as part of the acquisition of VanderSat in an unregistered sale[295] Management's Discussion and Analysis of Financial Condition and Results of Operations In FY2022, revenue grew 16% to $131.2 million, gross profit improved, but net loss widened to $137.1 million due to increased operating expenses post-Business Combination Key Operational and Business Metrics For FY2022, Planet reported a Net Dollar Retention Rate of 108%, 770 customers, and 92% recurring ACV, with capital expenditures decreasing to 11% of revenue Key Metrics Comparison (Year Ended January 31) | Metric | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | Net Dollar Retention Rate | 108% | 113% | 102% | | Net Dollar Retention Rate including Winbacks | 116% | 117% | 103% | | EoP Customer Count | 770 | 618 | 442 | | % Recurring ACV | 92% | 92% | 88% | | Capital Expenditures as % of Revenue | 11% | 27% | 25% | Results of Operations In FY2022, revenue increased 16% to $131.2 million, gross profit improved, but net loss grew to $137.1 million due to a 56% rise in operating expenses Consolidated Results of Operations (FY2022 vs. FY2021) | (in thousands) | FY 2022 | FY 2021 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | $131,209 | $113,168 | $18,041 | 16% | | Gross profit | $48,222 | $25,785 | $22,437 | 87% | | Loss from operations | ($128,051) | ($87,442) | ($40,609) | 46% | | Net loss | ($137,124) | ($127,103) | ($10,021) | 8% | Consolidated Results of Operations (FY2021 vs. FY2020) | (in thousands) | FY 2021 | FY 2020 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | $113,168 | $95,736 | $17,432 | 18% | | Gross profit (loss) | $25,785 | ($6,657) | $32,442 | (487%) | | Loss from operations | ($87,442) | ($106,460) | $19,018 | (18%) | | Net loss | ($127,103) | ($123,714) | ($3,389) | 3% | Liquidity and Capital Resources As of January 31, 2022, Planet had $490.8 million in cash, primarily from the Business Combination, and believes it has sufficient liquidity for the next twelve months Cash and Cash Equivalents | Date | Amount (in millions) | | :--- | :--- | | January 31, 2022 | $490.8 | | January 31, 2021 | $71.2 | Summary of Cash Flows (Year Ended January 31) | (in thousands) | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | Net cash used in Operating activities | ($42,211) | ($4,027) | ($33,687) | | Net cash used in Investing activities | ($25,149) | ($30,800) | ($27,172) | | Net cash provided by Financing activities | $489,184 | $83,940 | $8,728 | - As of January 31, 2022, the company had total principal commitments of $194.8 million, with the largest portion ($180.9 million) related to a non-cancelable hosting service agreement with Google through January 2028[394] Quantitative and Qualitative Disclosures About Market Risk Planet faces foreign currency risk (20% of FY2022 revenue in foreign currencies), but interest rate risk is minimal, and inflation has not materially affected operations - Approximately 20% of revenue for the fiscal year ended January 31, 2022, was in foreign currencies, primarily the Euro and Norwegian Krone, exposing the company to foreign currency exchange risk[457] - Interest rate risk is low as the company had no borrowings as of January 31, 2022, and its cash and cash equivalents are held in depository accounts not significantly affected by interest rate changes[459] - The company does not believe inflation has had a material effect on its business but notes that an inability to offset higher costs through price increases could harm future results[461] Financial Statements This section presents the company's audited consolidated financial statements for FY2022, FY2021, and FY2020, with accompanying notes and an unqualified auditor's opinion Consolidated Balance Sheets As of January 31, 2022, total assets significantly increased to $821.4 million, driven by a rise in cash to $490.8 million from the Business Combination Consolidated Balance Sheet Summary (in thousands) | | Jan 31, 2022 | Jan 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $490,762 | $71,183 | | Total current assets | $551,520 | $125,427 | | Property and equipment, net | $133,280 | $159,855 | | Total assets | $821,441 | $399,308 | | Liabilities and Stockholders' Equity | | | | Total current liabilities | $132,041 | $108,814 | | Total liabilities | $173,196 | $291,797 | | Total stockholders' equity | $648,245 | $107,511 | | Total liabilities and stockholders' equity | $821,441 | $399,308 | Consolidated Statements of Operations and Comprehensive Loss For FY2022, revenue was $131.2 million, gross profit improved, but increased operating expenses led to a $137.1 million net loss Consolidated Statement of Operations Summary (in thousands, except per share data) | | FY 2022 | FY 2021 | FY 2020 | | :--- | :--- | :--- | :--- | | Revenue | $131,209 | $113,168 | $95,736 | | Gross profit (loss) | $48,222 | $25,785 | ($6,657) | | Loss from operations | ($128,051) | ($87,442) | ($106,460) | | Net loss | ($137,124) | ($127,103) | ($123,714) | | Basic and diluted net loss per share | ($1.72) | ($2.87) | ($2.89) | Notes to Consolidated Financial Statements The notes detail accounting policies, the reverse recapitalization of the Business Combination, revenue recognition, acquisitions, debt, equity, and related-party transactions - The Business Combination with dMY IV was accounted for as a reverse recapitalization, with Former Planet as the accounting acquirer, resulting in $533.2 million in net proceeds[481][485] - In February 2021, the company changed its accounting estimate for the useful life of certain satellites from 6 to 9 years, resulting in a $17.6 million net decrease in depreciation expense for fiscal year 2022[510][512] - As of January 31, 2022, the company had remaining performance obligations of $153.4 million, with approximately 72% expected to be recognized as revenue over the next 12 months[592] - The company has a significant relationship with Google, a >10% shareholder, recognizing $8.6 million in revenue from Google and incurring $19.4 million in hosting expenses to Google in FY2022[686][688][689] Controls and Procedures Management concluded disclosure controls were effective as of January 31, 2022, and prior material weaknesses from the SPAC were remediated post-Business Combination - Management concluded that as of January 31, 2022, the company's disclosure controls and procedures were effective[722] - Material weaknesses in internal controls identified by the predecessor SPAC (dMY IV) were determined to be remediated and no longer existed as of January 31, 2022, following the Business Combination[724][725] - The company is not yet required to provide a management report or auditor attestation on internal control over financial reporting due to its status as a newly public and emerging growth company[723] Part III Directors, Executive Officers and Corporate Governance This section lists Planet's directors and executive officers, detailing the board's three standing committees and adopted code of business conduct Key Directors and Executive Officers | Name | Position | | :--- | :--- | | William Marshall | Chairperson, Co-Founder and CEO | | Robert Schingler, Jr. | Director, Co-Founder and Chief Strategy Officer | | Ashley Johnson | Chief Financial and Operating Officer | | Kevin Weil | President, Product & Business | | Carl Bass | Director | | Ita Brennan | Director | - The Board of Directors has three standing committees: an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee[747] - The company has adopted a code of business conduct and ethics applicable to all directors, officers, and employees[745] Executive Compensation This section details FY2022 executive compensation, including base salary, bonuses, and significant stock and option awards, with a new policy for non-employee directors FY 2022 Summary Compensation Table | Name and Principal Position | Salary ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Comp. ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | :--- | | William Marshall, CEO | 275,000 | 4,050,217 | 6,328,801 | 200,000 | 10,863,643 | | Ashley Johnson, CFO & COO | 367,500 | 2,004,346 | 3,214,726 | 185,000 | 5,798,319 | | Kevin Weil, President, Product & Business | 49,545 | 12,361,690 | 6,339,338 | — | 18,751,976 | - Executive compensation includes earn-out shares contingent on achieving specific stock price milestones post-Business Combination, which are accounted for as stock-based compensation[759][773] - The company adopted a new Outside Director Compensation Policy in connection with the Business Combination, effective for the fiscal year ending January 31, 2023, which includes annual cash retainers and equity awards[791] Security Ownership of Certain Beneficial Owner and Management and Related Stockholder Matters Significant beneficial owners include Google LLC and Draper Fisher Jurvetson, while co-founders Marshall and Schingler retain significant voting control via Class B stock Security Ownership of 5% Holders (as of April 7, 2022) | Name of Beneficial Owner | Class A Shares | % of Class A | Class B Shares | % of Class B | | :--- | :--- | :--- | :--- | :--- | | Google LLC | 31,942,641 | 12.95% | — | — | | Entities affiliated with Draper Fisher Jurvetson | 23,474,504 | 9.52% | — | — | | William Marshall | 13,661,703 | 5.25% | 10,578,793 | 50.0% | | Robert Schingler, Jr. | 11,413,653 | 4.42% | 10,578,793 | 50.0% | - All directors and executive officers as a group beneficially own 9.95% of Class A common stock and 100% of the high-vote Class B common stock[799] Certain Relationships and Related Transactions, and Director Independence All directors are independent except for the CEO and CSO; significant related-party transactions with Google include content license revenue and substantial hosting service commitments - The board has determined that all directors are independent under NYSE and SEC rules, with the exception of CEO William Marshall and CSO Robert Schingler, Jr[808] - Planet has a significant commercial relationship with Google, a major shareholder, including a Content License Agreement (revenue for Planet) and a Google Cloud Platform License Agreement (expense for Planet)[811] - Under its agreement with Google for cloud services, Planet has aggregate purchase commitments of $193 million from August 1, 2021, through January 31, 2028[811] Principal Accounting Fees and Services This section details fees billed by Ernst & Young LLP for FY2022 and FY2021, categorized into Audit, Audit-Related, and Tax fees, under an audit committee pre-approval policy Accounting Fees Paid to Ernst & Young LLP | Fee Category | Fiscal Year 2022 | Fiscal Year 2021 | | :--- | :--- | :--- | | Audit fees | $2,300,000 | $3,359,845 | | Audit-related fees | $257,900 | — | | Tax fees | $871,987 | $357,800 | | All other fees | — | — | | Total fees | $3,429,887 | $3,717,645 | Part IV Exhibits, Financial Statement Schedules This section lists all financial statements, schedules, and exhibits filed with the Form 10-K, including corporate governance documents and material contracts - This section provides an index of all financial statements and exhibits filed with the Form 10-K[826][828] Form 10-K Summary This item is not applicable - None[833]