SEATTLE — Even as Virgin Galactic enters regular commercial operations of its suborbital spaceplane, it is advising that those flights will generate only modest revenues for the near future.
Virgin Galactic reported Aug. 1 revenue of $2 million in the second quarter of 2023. The company said that the revenue came from its first commercial SpaceShipTwo mission, “Galactic 01,” on June 29, as well as membership fees from its private astronaut customers.
Galactic 01, a research flight for the Italian Air Force, marked the long-awaited start of commercial operations of the company’s VSS Unity vehicle. Virgin Galactic plans to fly Unity on roughly a monthly cadence.
The vehicle’s next mission, Galactic 02, is scheduled for Aug. 10 from Spaceport America in New Mexico. The flight will be the first to carry the company’s private astronaut customers. Virgin Galactic announced July 17 that flight will include Jon Goodwin, Keisha Schahaff and Anastatia Mayers. Goodwin was one of the company’s early customers while Schahaff and Mayers won a 2021 contest for seats on an early SpaceShipTwo flight.
“Galactic 02 is going to set the stage for a new era of suborbital human spaceflight that will dramatically broaden access to space for private individuals,” Michael Colglazier, chief executive of Virgin Galactic, said in an earnings call.
However, while the company played up the significance of Galactic 02, it is downplaying the revenue that and future flights will generate for Virgin Galactic. The company is forecasting just $1 million in revenue in each of the next two quarters.
Part of the reason for that, Colglazier said, is that about three-fourths of the 800 tickets sold so far were at prices of between $200,000 and $250,000 each. The company later raised prices to $450,000 each. In addition, while Unity’s cabin can accommodate four people, the company plans to fly only three paying customers on each flight initially, using the fourth seat for an astronaut trainer. In the case of Galactic 02, that is Beth Moses, the company’s chief astronaut instructor.
“When we look at the capacity of Unity and the ticket prices that we’re flying these days, you would expect to see for the near term about $600,000 per flight,” he said. He said the company expects to add a fourth paying customer to Unity flights “as we move into 2024,” increasing the per-flight revenue to about $800,000.
Research flights like Galactic 01 are more lucrative. Colglazier estimated those flights generate about $600,000 per seat equivalent. The company, though, has reserved only about 100 of its first 1,000 seats for research customers.
Virgin Galactic has largely stopped ticket sales for the time being other than those it is offering through a travel agency, Virtuoso, to manage its customer backlog. Colglazier said the company will sell new tranches of tickets as it gets closer to the introduction of its Delta class of next-generation spaceplanes, currently planned for 2026. Virgin has not set ticket pricing for those future sales, but he said “we don’t expect that to be less” than the current price of $450,000.
Colglazier also strongly suggested in the call that Virgin Galactic does not expect to fly VSS Imagine, a second suborbital spaceplane that the company had been developing. Virgin had deferred work on Imagine to prioritize company resources around both getting Unity into commercial service and development of the Delta class of vehicles.
“We’ve kind of kept it as an option for us, and it’s going to remain as an option for us,” he said of Imagine, but indicated it would likely be used to support Delta-class development versus flying commercial missions. “It’s still here with us, and we have it secured and ready. But it’s likely going to be used in service of the Delta program.”
The company reported a net loss of $134.4 million in the second quarter as it continues spending on Delta-class development. However, the company raised $241 million in a sale of stock in the quarter, giving the company $980 million in cash and equivalents on hand as of the end of the second quarter.