$450 thousand for an orbital flight

We note that Virgin Galactic is taking important steps towards the commercialization of space travel. We continue to believe that Virgin Galactic has the potential to become a leader in the space tourism market, and we appreciate the company’s focus on scaling business and promoting space. We believe the new $ 450,000 ticket price up from the previous $ 250,000 mark underscores the strength of the Virgin Galactic brand and the growing interest from high net worth customers.

Following its second successful test flight (Unity 22) in July, Virgin Galactic announced that it will conduct its next flight (Unity 23) in late September, which will carry the Italian military. After the third test flight, the company will take an eight-month hiatus to modify VMS Eve and VSS Unity (until mid-2022). After the upgrade, the flagship VMS Eve will be able to perform 100 flights between maintenance, which is 10 times better than the previous estimate. The VSS Unity suborbital rocket manned spaceplane will be able to fly every 4-5 weeks, up from a previous estimate of 7-8 weeks. In Q3 2022, as part of the fourth flight of Unity 24, the company will send a team of specialists into orbit to ensure that the flight is fully operational and safe. Unity 25 will be the first commercial flight scheduled for the end of Q3 next year.

Virgin Galactic is a pioneer in space tourism, so the company is highly positioned to generate profits and maintain a leading position in a market that is protected by high barriers to entry. Notably, the company uses its own proprietary technologies and vertically integrated manufacturing solutions to explore the commercial space flight market. If successful in test flights, we expect Virgin to run a highly profitable business and generate high cash flows that the company can invest in high-speed point-to-point travel as well as orbital flights. However, one should not forget about the risks, which include: 1). possible delays in upcoming test flights. 2). technical problems that could potentially arise from test flights. 3). any issues related to the safety of the crew.

Virgin Galactic, founded in 2004, is a vertically integrated aerospace company and a leader in human spaceflight. Virgin Galactic has two main missions – commercializing space travel and revolutionizing commercial flight by offering high-speed point-to-point travel. Virgin Galactic’s reusable space launch system includes carrier aircraft White Knight Two and spacecraft SpaceShipTwo. SpaceShipTwo and White Knight Two are manufactured and tested in Mojave, California by Virgin Galactic’s space-system manufacturing organization – The Spaceship Company (TSC). Spaceflight operations will be based at Spaceport America in New Mexico.