Virgin Galactic’s Q3 Revenue Falls Short, Shares Plummet
Space Tourism Ambitions Take a Hit
Virgin Galactic Holdings Inc. suffered a setback on Wednesday as it reported disappointing third-quarter revenue, sparking a 12% decline in its shares. The Richard Branson-founded company’s revenue for the period ending September 30 came in at $0.4 million, missing analyst expectations of $0.53 million. This marks a staggering 77% drop from the $1.7 million reported in the same period last year.
Raising Capital for New Spacecraft
To accelerate development and production of its fleet, Virgin Galactic announced an at-the-market equity program, allowing it to sell shares worth up to $300 million. These funds will be used to support the creation of a new “mothership” carrier plane and Delta Class spaceships. The company has been burning through approximately $120 million in cash each quarter since pausing its space tourism trips.
Cashing In on Delta Class Spaceships
The California-based firm expects its cash burn rate to decrease below $100 million in the fourth quarter of 2025, according to Chief Financial Officer Doug Ahrens. Virgin Galactic’s last flight took place in June, and it has since halted further trips to focus on its more advanced Delta spaceship, set to enter commercial service in 2026. The revamped vehicles will accommodate six passengers, two more than its previous craft, and are designed for faster turnaround between missions.
Ticket Sales and Production Timeline
Virgin Galactic finished initial flight control testing and plans to resume ticket sales about a year before the Delta spaceship takes flight. The company aims to have a second mothership operational around 2028, which will enable it to clear the existing backlog of around 700 ticket holders in approximately a year. Tickets on the Delta spaceship are expected to cost a staggering $600,000 per seat.
Financial Performance and Outlook
Virgin Galactic reported a loss per share of $2.66 in the third quarter, with its cash and cash equivalents decreasing by 25% to $172.4 million compared to last year. Despite the setbacks, the company remains committed to its space tourism ambitions, with shares currently trading at $6.28 in New York.
Leave a Reply