What happened

Rocket Lab USA (RKLB -0.24%) second-quarter results came in well ahead of expectations, and the company raised its outlook for the current quarter. Shares are blasting off, gaining 21% in Friday trading.

So what

Rocket Lab is one of the number of space stocks that have hit the market in recent years, attempting to disrupt what has historically been a very small industry. Rocket Lab is focused on the small-satellite launch market and has been attempting to develop into a one-stop shop that can build satellites for customers and then launch them.

The plan appears to be working. Rocket Lab reported Q2 revenue of $55.5 million, up from $11.28 million in the same quarter a year ago. It also lost less money, reporting a loss of $0.08 per share compared to $0.21 per share in Q2 2021. In a statement, CEO Peter Beck said:

We are encouraged by broad-based momentum that continued across our space systems business which comprised 66% of our revenue in the second quarter. Space systems continues to be significant growth area, with construction of our satellite constellation production facility in Long Beach substantially complete.

Rocket Lab also forecasted third-quarter revenue to come in at between $60 million and $63 million, ahead of the $54.4 million analyst consensus.

Now what

Rocket Lab hasn't gotten the amount of attention received by other space stocks focused on tourism or scientific pursuits, but it could end up being the best business. The small- to medium-sized launch market is the fasted growing subsector of the space market, and Rocket Lab is positioning itself as the low-cost leader with the ability to use its production facility to offer customers favorable pricing.

Though Rocket Lab shares are soaring today, the stock is still more than 60% below its 52-week high. If the company can keep generating growth like it did in the most recent quarter, there is still altitude to be gained from here.