Is Firefly Aerospace a Broken IPO?

Since joining the public markets in August, Firefly Aerospace (FLY +16.99%) has taken its investors on a very wild ride. IPO’ing at a $45 offer price, Firefly actually began trading 55% above that price, at $70 a share, and closed its first day of trading still up 33%, at $60.35.

Unfortunately for space investors, it’s been mostly downhill since. For most of the month of August, Firefly stock has actually traded _below _its $45 offer price – the very definition of a broken IPO.

You cannot say I did not warn you.

Image source: Getty Images.

Firefly’s high-flying IPO

On the eve of Firefly’s IPO last month, I ran down the facts and figures on what was soon to become the world’s newest space stock, seeking to determine if the IPO might be a buy. I pointed out how Firefly initially planned to IPO at a $35 price, but steadily ratcheted its offer price higher as more and more investors expressed interest in buying into the IPO – as high as $42 a share.

At that price, I calculated the stock would be selling for 27 times current-year sales, much higher than the 2x to 4x valuation more common among unprofitable space stocks. Firefly raised its offer price one last time, to $45 a share.

At that price, the stock was trading for 2_9_x estimated sales.

Had I known they were going to do that… well, to be honest, my opinion probably wouldn’t have changed much. After all, Firefly stock had really only gone from overvalued to just a bit more overvalued than it already was!

Firefly’s first earnings report

As it turns out, Firefly stock has now returned to the $42 stock price that (I thought) it was going to IPO at. And the most recent reason why that happened is that on Monday, Firefly made its first official earnings report as a publicly traded company.

Investors clearly weren’t impressed with the company’s report, selling off Firefly stock by more than 15%. But what was it specifically that upset them?

Beginning with the numbers, we see that Firefly collected $15.5 million in revenue in Q2 2025, down 27% versus Q2 2024. Cost of sales, however, dropped even more, with the result that Firefly actually grew its gross profit 35% for the quarter, to $4 million.

But that’s where the good news ended.

Between research and development and other operating costs, and interest on its debt, Firefly reported a net loss of $80.3 million for the quarter, which worked out to $5.78 per share. According to Yahoo! Finance estimates, however, analysts following Firefly had only been expecting the company to lose $0.46 per share – so the nearly $6-per-share loss came as an unpleasant surprise.

I suspect this “earnings miss” had a lot to do with why investors sold off Firefly stock this week.

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NASDAQ: FLY

Firefly Aerospace

Today’s Change

(16.99%) $3.50

Current Price

$24.10

Key Data Points

Market Cap

$3.3B

Day’s Range

$23.08 - $24.25

52wk Range

$16.00 - $73.80

Volume

91K

Avg Vol

3.3M

Gross Margin

-490.85%

Firefly updates its resume

Aside from the earnings miss, though, things actually don’t look so bad for Firefly. Looking beyond the numbers, for example, the space company was able to assure Congress that its successful Blue Ghost Mission 1 moon landing in March sets the company up to compete for future NASA Commercial Lunar Payload Services (CLPS) contracts, and to update investors on its progress preparing for its next moon landing, Blue Ghose Mission 2 – due to take place next year.

Firefly has also:

• Contracted to carry a United Arab Emirates moon rover on Blue Ghost Mission 2
• Made progress on a plan to begin rocket launches from Sweden
• Won a third mission (this one from the War Department) to launch an Elytra spacecraft into orbit
• Won a fourth NASA moon landing contract, for 2029, for Blue Ghost Mission 4. (For those keeping track, Firefly will be putting landers on the moon in 2026, 2028, and 2029 – and launching its Elytra spacecraft for the Pentagon in 2027.)

In perhaps the most important news of all, Firefly confirmed its partnership with defense contracting giant Northrop Grumman remains strong, and that Northrop has invested a further $50 million in codeveloping the two companies’ upcoming Eclipse medium-lift rocket.

Is Firefly Aerospace stock a buy today?

So where does this put us as investors? Honestly, I think we’re basically back where we started in August! Just like back then, on the eve of the IPO, Firefly Aerospace is a company with tons of potential, and a launch manifest brimming with exciting missions.

Just like back then, though, Firefly is a _stock _costing probably quite a bit more than I want to pay to own it. Valued today at $7.2 billion, and with guidance for 2025 revenue of no more than $145 million, I calculate the stock’s price-to-sales ratio at nearly 50x.

At that price, I fear the only realistic direction Firefly stock can go now is down.