Rocket Lab narrowed its loss and reported rising revenue in the second quarter as its backlog ballooned. The launch and space systems company reported a loss of $49.3 million, or 8 cents a share, compared with a loss of $66.4 million, or 13 cents a share, a year earlier. Revenue grew to $234.1 million, up from $144.5 million a year prior.

Product revenues nearly doubled to $181.3 million from $92.7 million, while service revenues ticked up to $52.7 million from $51.8 million. Analysts polled by Fact Set were expecting a loss of 6 cents a share on revenue of $231.6 million.

Shares of Rocket Lab fell 1.6% to $78.80 after Monday’s bell. The company’s backlog ballooned, signaling strong future demand for its launch and space systems offerings. Despite the slight earnings miss versus analyst expectations, the year-over-year improvement in both revenue and net loss reflects operational progress.

Investors will watch for continued momentum in product sales, which now account for the majority of total revenue. The narrowing loss and rising top line provide a positive backdrop as Rocket Lab scales its business and competes for commercial and government contracts.