Financial Performance Overview

Virgin Galactic, an aerospace and space travel company, has reported its financial results for the three months ended March 31, 2025. The key highlights are as follows:

Revenue:

• Revenue for the three months ended March 31, 2025 was $461,000, primarily attributable to access fees related to the company’s astronaut community. This is a decrease from $1.985 million in the same period in 2024, which was primarily from commercial spaceflight revenue and access fees.

Expenses:

• Spaceline operations expenses decreased from $22.6 million in Q1 2024 to $20.8 million in Q1 2025, driven by lower employee-related costs.
• Research and development expenses decreased from $59.0 million in Q1 2024 to $33.3 million in Q1 2025, due to lower subcontractor and contract labor costs for next-generation vehicle development.
• Selling, general and administrative expenses increased from $27.9 million in Q1 2024 to $30.6 million in Q1 2025, primarily due to higher legal costs.
• Depreciation and amortization expense increased from $3.7 million in Q1 2024 to $4.2 million in Q1 2025 due to the acquisition of more property, plant and equipment.

Profitability:

• The company reported a net loss of $84.5 million in Q1 2025, an improvement from a net loss of $102.0 million in Q1 2024.

Liquidity and Capital Resources:

• As of March 31, 2025, the company had $172.2 million in cash, cash equivalents and restricted cash, and $394.4 million in marketable securities.
• Net cash used in operating activities was $75.9 million in Q1 2025, compared to $113.2 million in Q1 2024.
• The company raised $29.7 million in Q1 2025 through its at-the-market offering program.

Strengths and Weaknesses

Strengths:

• Significant customer demand, with reservations for approximately 675 future astronauts representing $189 million in expected future revenue.
• Continued progress in the development of the company’s next-generation Delta Class spaceships, which are expected to dramatically increase the annual flight rate.
• Strong liquidity position with $566.6 million in cash, cash equivalents, restricted cash and marketable securities.

Weaknesses:

• Temporary pause in commercial spaceflight operations, with the restart of service not expected until summer 2026.
• Ongoing high research and development expenses, though decreasing, as the company invests in its next-generation vehicles.
• Reliance on external funding through equity offerings to support operations and capital expenditures.

Outlook

Virgin Galactic is focused on the development and commercialization of its next-generation spaceflight vehicles, which are expected to significantly increase the company’s annual flight rate. The company anticipates commencing commercial service with its first research spaceflight in the summer of 2026 and the first private astronaut spaceflight in the fall of 2026.

The company believes its current capital is adequate to sustain operations for at least the next twelve months. However, the costs associated with the commercial launch and fleet expansion remain unpredictable and subject to significant risks and uncertainties. The company may need to seek additional debt or equity financing beyond the next twelve months to support its long-term growth and expansion plans.