An initial look at the combined Rocket Lab-Iridium government business

By agreeing to acquire Iridium Communications, Rocket Lab is looking to chart a new course for itself as a company whose products and systems would cover all aspects of space.

Rocket Lab was born as a launch provider in 2006 and that will remain core to its business plan going forward. The $8 billion cash-and-stock pact to purchase Iridium adds spectrum, an established satellite network and a customer base that includes U.S. government agencies.

Speaking on an investor presentation Monday, Rocket Lab founder and CEO Peter Beck described the user base of Iridium’s 66-satellite NEXT constellation and how they connect to the network.

“[The Iridium network] delivers continuous pole-to-pole global communication coverage to every ocean, every mountain and every airway in the entire planet,” Beck said. “Iridium is critical to the people and the systems that just can't lose signal: pilots, mariners, first responders, governments, critical infrastructure and remote sensors operating at the ends of the Earth.”

Rocket Lab employs roughly 2,600 people worldwide and Iridium touts a workforce of around 1,000 staffers. Both companies also derive significant amounts of revenue from contracts for U.S. government work, according to their annual 10-K reports for investors.

Of Rocket Lab’s $601.8 million in revenue for 2025, approximately 47% of that was derived from contracts with federal agencies or other prime contractors. Substantially all of Rocket Lab’s prime contracts are fixed-price.

Rocket Lab also touts having launched at least 200 spacecraft for its customers since inception, a figure that includes U.S. agencies such as Space Force and NASA.

Iridium posted $871 million in revenue for 2025 with 29% of that from contracts with agencies or other prime contractors.

The bulk of Iridium’s federal business centers around the Enhanced Mobile Satellite Services contract with DOD, which started in 2013 and was renewed in 2019 at a $738.5 million ceiling over up to six years.

The current EMMS contract has a fixed-price annual rate of $110.5 million through September 2026, while Iridium expects to negotiate the follow-on before that sunset date or six-month extension in early 2027.

At its essence, EMSS functions as a family plan for U.S. government agencies to access the NEXT constellation with unlimited voice and narrowband data. This includes satellite phones, messaging devices, remote sensors and other products.

During the presentation, Beck said Iridium provides “a little bit of a shortcut” to Rocket Lab in terms of acquiring spectrum and standing up a satellite constellation.

Through this transaction, Rocket Lab is going down a similar path that SpaceX has in bringing together launch services with satellite network connectivity.

SpaceX closed its record initial public offering in early June and views its Starlink communications unit as a main growth avenue, along with artificial intelligence to enable computing in space.

Rocket Lab and Iridium expect to close the transaction in mid-2027, pending regulatory approvals and other closing conditions.

The $8 billion cash-and-stock value breaks out to $54 per share of Iridium’s common stock and debt Rocket Lab will assume following closure. Iridium stockholders will receive $27-per-share in cash and a number of shares in Rocket Lab that will be calculated according to an exchange ratio.

As part of the transaction, Rocket Lab has also received commitments for a $3.6 billion 364-day senior secured bridge term loan facility from Deutsche Bank and Wells Fargo.

Rocket Lab’s advisers for the transaction are Deutsche Bank Securities, Wells Fargo, PJT Partners, Wilson Sonsini Goodrich & Rosati, Goodwin Procter LLP and DLA Piper LLP. Iridium’s advisers are Evercore Davis Polk & Wardwell LLP, Wilkinson Barker Knauer LLP and Joele Frank.

Below is a Bloomberg TV interview with Beck aired Monday.