Virgin Galactic shares drop 15% after aborted spaceflight test, which the company will repeat

Investing News

SpaceShipTwo “Unity” on the runway after an aborted spaceflight test on Dec. 12, 2020.

Virgin Galactic

Virgin Galactic’s stock fell in premarket trading on Monday after the space tourism company cut short its latest spaceflight test mid-launch on Saturday due to an engine ignition issue.

“The flight did not reach space as we had been planning. After being released from its mothership, the spaceship’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. Following this occurrence, our pilots flew back to Spaceport America and landed gracefully as usual,” Virgin Galactic CEO Michael Colglazier said in a statement.

The company expects to repeat the spaceflight attempt from its operating base at Spaceport America in New Mexico. Colglazier said that Virgin Galactic is evaluating the data from the test and did not indicate when it expects to be ready to launch again, with the company saying it has several rocket engines “ready” onsite and will “check the vehicle and be back to flight soon.”

Shares of Virgin Galactic dropped more than 16% in premarket trading from its previous close of $32.04.

Saturday’s flight was the first of three remaining spaceflight tests the company plans to conduct to complete development of its spacecraft system, the third of which will carry founder Sir Richard Branson. The impact of the aborted test on Virgin Galactic’s schedule is yet to be determined, with the Branson flight previously planned for first quarter of 2021.

Additionally, Virgin Galactic’s spaceflight attempt on Saturday was the company’s first in nearly 22 months, with its previous spaceflight in February 2019 from the Mojave Air and Space Port in California. In the interim the company moved its operations to Spaceport America, from its manufacturing and development facilities in Mojave.

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