SPCE stock tumbled Monday after billionaire founder Richard Branson ruled out further investment in his space tourism company Virgin Galactic.
In a Sunday interview with the Financial Times, Branson said his business empire has less cash to work with following the coronavirus pandemic, and that Virgin Galactic should have enough financing to sustain operations.
Branson's Virgin Group is one of the biggest shareholders in Virgin Galactic with a 7.7% stake in the company after selling more than $1 billion shares in 2020 and 2021, according to the Financial Times.
"We don't have the deepest pockets after Covid, and Virgin Galactic has got $1 billion, or nearly," Branson said. "It should, I believe, have sufficient funds to do its job on its own."
Virgin Galactic announced plans in early November to pause spaceflight operations for its Unity aircraft in mid-2024 in order to focus resources on building its new Delta ships. The Delta ships have more passenger seats and are expected to fly more regularly, which will increase monthly revenue according to Virgin Galactic. Virgin Galactic plans to start test flights for the Delta in mid-2025.
On Nov. 2, Virgin successfully completed its Galactic 05 mission, its sixth suborbital flight in six months and tenth to date.
The plan to pause space flights also includes laying off 185 employees, or roughly 18% of the company's workforce. Virgin Galactic listed $1.1 billion of cash and equivalents on-hand in its Q3 results on Nov. 8. The space tourism company has yet to turn a profit.
SPCE Stock
SPCE stock fell roughly 18% Monday, marking their worst trading day since June 29 when SPCE stock fell 10.8% following Virgin Galactic's first successful commercial spaceflight.
SPCE stock is down nearly 45% in 2023.
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