Virgin Shares Plunge As Aborted Launch Delays Space Program
After all of SpaceX's aborted launches and outright failures (none of which, thankfully, resulted in the loss of human life), you'd think the market would have internalized the notion that rocket launches sometimes get aborted three or four times before the circumstances align in just the right way.
Not so.
Shares of Robinhood favorite Virgin Galactic plunged 17% in premarket trading to $26.61 early in the NY morning after the company's push to be the first to shuttle tourists to space suffered another setback when a test flight was cancelled shortly after takeoff because of a technical issue.
CEO Michael Colglazier broke the news in a tweet after the launch on Saturday.
Thread: our CEO, Michael Colglazier, on today’s flight test. Today’s flight landed beautifully, with pilots, planes, and spaceship safe, secure, and in excellent shape — the foundation of every successful mission! Our flight today did not reach space as we had been planning. pic.twitter.com/pqfUAtp6UH
— Virgin Galactic (@virgingalactic) December 12, 2020
After being released from its mothership, SpaceShipTwo Unity’s onboard computer that monitors the rocket motor lost connection. As designed, this triggered a fail-safe scenario that intentionally halted ignition of the rocket motor.
— Virgin Galactic (@virgingalactic) December 12, 2020
Following this occurrence, our pilots flew back to Spaceport America and landed gracefully as usual.
— Virgin Galactic (@virgingalactic) December 12, 2020
When I became CEO, I was briefed on the safety engineering of our Spaceflight System, which is purposely designed to enable our pilots to safely glide back at any point.
Seeing firsthand how our pilots brought Unity in for a picture-perfect landing after an off-nominal condition confirmed this approach. I am even more confident that this is the level of safety that consumers will want and will be expecting from us.
— Virgin Galactic (@virgingalactic) December 12, 2020
As we do with every test flight, we are evaluating all the data, including the root cause assessment of the computer communication loss. We look forward to sharing information on our next flight window in the near future.
— Virgin Galactic (@virgingalactic) December 12, 2020
Wall Street analysts signing in Sunday night warned that the failure is likely to lead to another delay for the stock's space program that could last weeks, according to Myles Walton at UBS.
"The failure to reach orbit importantly validated safe failure modes for a rocket misfire, which likely won’t make the market feel better Monday but is actually an important validation of safety of the architecture," Walton wrote.
That's bad news for a company that's almost as well known now for its pioneering position in the SPAC investment craze as its push to send tourists to space.
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