What a difference a few days can make. After falling nearly 3% on Friday, shares of Astra Space (NASDAQ:ASTR) are up 30% in this morning’s pre-market session after one of the Alameda, California-based company’s rockets reached orbit for the very first time.
In a news release, Astra Space announced that it had successfully completed its first commercial orbital launch in a test flight that was carried out for the U.S. military.
Specifically, the company said that, late Friday night, it had sent its STP-27AD2 rocket into orbit carrying a test payload for the U.S. Space Force. The successful launch came hours after the company had abruptly aborted a planned launch early Friday morning for unspecified reasons. The earlier delay had sent ASTR stock lower headed into the weekend.
What Happened With ASTR Stock
The launch of Astra Space’s STP-27AD2 rocket was carried out at the Pacific Spaceport Complex in Kodiak, Alaska. The company said that its rocket achieved an orbital velocity of 7.61 kilometers per second and was in Earth’s orbit for a total of 8 minutes and 47 seconds. The U.S. Space Force contracted the launch through a “Defense Innovation Unit Other Transaction Agreement.”
Importantly, Friday marked the first successfully completed launch by Astra Space, which was founded in 2016. A previous rocket launch carried out in August was cancelled less than three minutes after it began, and the launch originally planned for last Friday morning was scrubbed at the last minute.
“Reaching orbit is a historic milestone for Astra,” said Chris Kemp, founder, chairman and CEO of Astra Space, in a news release. “We can now focus on delivering for our customers and scaling up rocket production and launch cadence.”
Investors are reacting positively to news that Astra Space has finally fulfilled its promise of getting a test rocket into orbit, and this morning’s huge 30% jump in ASTR stock is no doubt welcome news to shareholders. The stock finished trading last Friday at $9.53. Astra Space is supported by several prominent names, including Marc Benioff, co-founder of Salesforce (NYSE:CRM), and Michael Eisner, former head of Disney (NYSE:DIS).
Why It Matters
The first successful launch of Astra Space’s rocket into orbit is a huge vote of confidence in the company’s ability to create reliable rockets for commercial purposes. Astra Space aims to become a leader in the burgeoning market for launching small satellites into orbit above Earth. It’s an area that several other companies are racing to get into, notably SpaceX.
Astra Space says it is different than its competitors because it offers “cost-effective, mass-produced and easily transportable rockets.” However, key to the company moving forward was it achieving the milestone of its first orbital test flight.
Now that Astra Space has cleared that hurdle, it can focus on its ultimate goal of carrying payloads of commercial satellites into space, as well as fulfilling the various contracts it has with the U.S. military. The ability to move forward is good news for shareholders of ASTR stock.
What’s Next for Astra Space
ASTR stock is going to get a nice bounce this morning when the opening bell rings. However, it is important for investors to realize that today’s big increase only serves to make up ground that Astra Space stock has lost during the course of this year.
That said, today’s gains are welcome news for a company that has struggled to meet its shareholders’ high expectations. Going forward, Astra Space will need to build on today’s positive news and prove that it can sustain its own lofty ambitions.
On the date of publication, Joel Baglole held a long position in DIS. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.