Intuitive Machines (LUNR 4.23%), a producer of lunar landing and exploration vehicles, went public by merging with a special purpose acquisition company (SPAC) on Feb. 13, 2023. Its stock started trading at $10 per share and skyrocketed to a record high of $81.99 just nine days later.
Yet that rally sputtered out as it struggled with delayed launches and steep losses. On Jan. 4, 2024, the stock closed at its all-time low of $2.04. At the time, many investors dismissed it as just another SPAC-backed space start-up that overpromised and underdelivered.
But despite that rough start, Intuitive's stock now trades at about $11 a share. Its price soared again as the company's first two landers reached the moon, it secured more contracts from NASA, and it attracted more commercial clients.
So will this space stock soar even higher over the next 10 years?
Image source: Getty Images.
Why did Intuitive Machines' stock bounce back?
Intuitive Machines generates most of its revenue from its lunar exploration contracts with NASA. Last February, its first Nova-C lunar lander, IM-1 (Odysseus), landed on the moon. That marked the first successful U.S. landing on the moon since 1972. Its second Nova-C lander, IM-2 (Athena), reached the moon this March.
Both missions ran into some issues. Odysseus tipped over after it landed on the moon, but its solar panels collected enough energy to transmit over 350 megabytes of data before shutting down. Athena, which landed on the Moon's south pole, also tipped over upon landing -- but it still transmitted some data before its panels lost power.
Despite those mistakes, NASA still awarded Intuitive with new lunar terrain vehicle contracts, an exclusive near-space network services contract, and a lunar logistics solutions contract. It also remains locked into NASA's long-term Commercial Lunar Payload Services (CLPS) contracts (which include IM-1 and IM-2) for more lunar landers.
NASDAQ: LUNR
Key Data Points
Intuitive Machines' revenue surged from $80 million in 2023 to $228 million in 2024 after it achieved its first successful landing and gained more milestone payments. But it racked up a steep net loss of $284 million in 2024 -- compared to a net profit of $60 million in 2023 -- as its engineering, testing, and mission development costs increased.
Intuitive expects to scale up its business over the next few years. At the end of the first quarter of 2025, it still had a backlog of $272 million, $373 million in cash and cash equivalents, and no long-term debt. Its biggest near-term catalysts will include its IM-3 launch in late 2025 to early 2026, followed by its IM-4 launch in 2027.
Assuming Intuitive successfully executes those landings -- and those landers don't tip over -- it could secure even more contracts from NASA and widen its lead against competing CLPS contract holders like Astrobotic Technology, Firefly Aerospace, and Draper Laboratory. Looking ahead, Intuitive's development of a lunar satellite constellation for communications through its NSNS contract with NASA could generate recurring revenue and reduce its dependence on mission-based revenue and milestone payments.
The expansion of its commercial ride-sharing business, which helps other companies deliver their own payloads to the moon, could gradually reduce its dependence on NASA and boost its margins. It could also secure more non-CLPS contracts from NASA or Department of Defense contracts.
How much bigger could Intuitive Machines grow in 10 years?
From 2024 to 2027, analysts expect Intuitive's revenue to grow at a CAGR of 25%. They expect its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to turn positive in 2026 and surge 151% in 2027. Those rising profits are being driven by its improving operating efficiency and a rising mix of higher-margin services.
The global space lander and rover market could expand at a CAGR of 9.7% from 2025 to 2034, according to Global Market Insights. So, assuming Intuitive matches analysts' expectations through 2027 and continues to grow its revenue at CAGR of 10% over the following eight years, it could generate $946 million in revenue by 2035. If it still trades at about 5 times sales by the beginning of 2035, its market cap could more than triple to $4.73 billion in 10 years.
That outlook seems promising, but Intuitive is still a speculative play that relies on the unfettered expansion of the lunar exploration market. That secular growth story could be disrupted by recessions, geopolitical conflicts, and other unpredictable macro headwinds -- so investors should carefully weigh the risks and rewards before pulling the trigger.
