Shares of Intuitive Machines Inc. (NASDAQ: LUNR) fell sharply in premarket trading on Thursday, sliding 8.6% to $15.50, after the space exploration company reported second-quarter results that fell short of Wall Street expectations. The stock's decline reflects investor concerns about the company's ability to meet its full-year targets, which necessitate a significant acceleration in revenue growth during the second half of the year.
For the quarter ended June 30, Intuitive Machines reported revenue of $206.17 million, a 310% year-over-year surge, but still below the consensus estimate of $216.3 million. The company's adjusted EBITDA came in at a loss of $13.8 million, a sharp reversal from the positive $2.7 million recorded in the first quarter and well below the $3.2 million profit analysts had anticipated. This brought first-half adjusted EBITDA to a negative $11.1 million.
The company's guidance for the full year remains unchanged, calling for revenue in the range of $900 million to $1 billion. With first-half revenue totaling $392.87 million, Intuitive Machines must generate between $507.13 million and $607.13 million in the final two quarters to hit that target. This implies an average quarterly revenue of $253.57 million to $303.57 million, representing a 29.1% to 54.5% increase over the first-half's quarterly average. This steep ramp-up is the most significant challenge reflected in the company's maintained outlook.
To achieve positive adjusted EBITDA for the full year, the company will need to generate more than $11.1 million in profit during the second half, a substantial improvement from the current trajectory. The company's backlog, however, provides some support, having climbed to an all-time high of $1.8 billion as of the end of the second quarter, up from $1.055 billion at the end of March. This backlog represents approximately 1.89 times the midpoint of the annual revenue forecast, offering a cushion for future sales.
Recent contract wins have contributed to the backlog's growth. In March, NASA awarded the company a lunar-delivery task order worth $180.4 million, followed by a $148.3 million award in June as part of the sixth Commercial Lunar Payload Services (CLPS) contract. The combined value of these two contracts, $328.7 million, represents about 34.6% of the $950 million midpoint of the company's revenue guidance.
CEO Steve Altemus has emphasized a strategic shift toward commercial mass production of lunar infrastructure, a move that could enhance scalability but also increases execution pressures as the company ramps up for rapid integration and production. The timing of contract awards and the speed of backlog conversion will be critical to meeting the ambitious second-half targets.
Analysts remain cautiously optimistic about the company's prospects. A recent roundup of analyst ratings shows seven Buy recommendations, one Hold, and one Sell, with an average price target of $40.78, ranging from $11 to $75. However, these targets were set prior to Thursday's earnings release and are now subject to revision. The stock had rallied 37% from the start of August through Wednesday's close, making it particularly vulnerable to disappointment.
Investors are now looking for evidence that the backlog will convert into revenue quickly enough to meet the projected sales range and deliver positive adjusted EBITDA. Risks remain, including potential delays, reductions, or cancellations of government awards, extended mission timelines, and margin pressures from acquisitions. Conversely, faster-than-expected backlog conversion or additional contract wins could provide upside.
The immediate benchmark is clear: quarterly revenue must significantly outpace the first-half's rate, and adjusted EBITDA must turn firmly positive. Intuitive Machines benefits from a robust backlog, but whether that translates into profits depends on execution in the coming quarters.
