Rocket Lab Stock Is Spiraling Lower: What's Going On?

Rocket Lab USA Inc (RKLB) shares are trading lower in Wednesday’s after-hours session following the company’s announcement of a proposed offering.

What To Know: After the close on Wednesday, Rocket Lab said that it had commenced a private offering with institutional buyers to raise $275 million from convertible senior notes due 2029.

Rocket Lab intends to use a portion of the net proceeds from the offering to pay the cost of entering into capped call transactions with one or more initial purchasers. The company also plans to use $40 million to repay a portion of its borrowings under its equipment financing agreement.

The news comes just hours after Rocket Lab reported preliminary financial results for the fourth quarter. The company said it expects fourth-quarter revenues of $59 million to $61 million, gross margins of approximately 24.8% to 26.8% and a net loss of $49 million to $52.5 million.

“With our 43rd Electron mission now launched, more launches scheduled in 2024 than in any prior year, and a record backlog, we’re excited to continue building on our success delivering end-to-end space solutions to the market,” said Peter Beck, founder and CEO of Rocket Lab.

See Also: One Month Into 2024, SpaceX Is Already Falling Short Of Its Own Launch Targets: Temporary Setback Or Cause For Concern?

RKLB Price Action: Rocket Lab shares closed Wednesday down 2.61%. The stock was down another 12.01% after hours at $4.26 at the time of publication, according to Benzinga Pro.

Photo: courtesy of Rocket Lab.