Shares of Virgin Galactic (NYSE:SPCE) are coming back to earth after the space tourism operator reported its latest quarterly loss and further delayed its next spaceflight test. SPCE stock continued 10 days of declines, with shares off more than 20% in pre-market trading on Tuesday morning.
The space tourism company reported an adjusted EBITDA loss of $55.9 million, down slightly from a loss of $59.5 million in the previous quarter and falling short of the adjusted EBITDA loss of $63.6 million expected by analysts.
With no revenue generated for a second consecutive quarter, Virgin Galactic had some $617 million in cash available at the end of the first quarter, down from about $666 million in the fourth quarter.
The results come as competition is heating up in the emerging space tourism. Its rivals are private companies led by two of the most influential entrepreneurs in modern history. The first is Blue Origin, led by Jeff Bezos, and the other is SpaceX, led by Elon Musk.
Failure to Launch Keeps SPCE Stock Down
In its Q1 update, Virgin Galactic said the scheduled launch for its next test flight was now being reevaluated. It was expected to take place this month. The company’s president of space missions and safety, Mike Moses, said that “a potential wear-and-tear issue” was spotted last week on the aircraft that carries SPCE’s spacecraft prior to launch. Executives said they would report back next week with an update on timing.
Virgin Galactic has said previously it sees the first commercial flight in early 2022, about a year later than what it initially planned.
Rival Blue Origin last month achieved the 15th straight successful launch of its suborbital space rocket called the New Shepard. It included simulated passenger embarking and debarking, and would have a crew aboard the next time it goes up.
“So now it’s not just a race against their own cash position, but we’re starting to see a much more formalized race between Virgin Galactic and Blue Origin,” Andrew Chanin, co-founder and CEO of ProcureAM, told Investors Business Daily. The firm is the sponsor of the Procure Space ETF (NASDAQ:UFO), which includes SPCE stock in the exchange-traded fund’s top 10 holdings.
The delays are sure to further shake investor sentiment on SPCE stock, already reeling from concerns about insider selling that has taken place in the past few months.
InvestorPlace contributor Muslim Farooque recently wrote that SPAC investor Chamath Palihapitiya has sold his entire personal stake in the company. He sold close to 3.8 million shares in December and another 6.2 million in March. As well, Virgin founder Richard Branson has recently sold more than $150 million worth of his company stock. “The colossal unloading of the stock raises questions about Virgin’s potential,” he wrote.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News, McKinsey & Co. and McDonald & Company Investments.
