Second Quarter 2026
Filed Aug 12, 2026Virgin Galactic reported $0.1 million of revenue, a $56 million net loss and $(91) million of free cash flow, while moving first commercial spaceflight to February 2027.
Operating expenses, net loss and free cash flow improved from the second quarter of 2025, and the $750,000 expedition tranche was oversubscribed. However, revenue remained $0.1 million, first commercial service moved from the fourth quarter of 2026 to February 2027, and the Company expects continued negative free cash flow in the third and fourth quarters of 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| RevenueGAAP | $0.1 million | – | – |
| Total operating expensesGAAP | $65 million | – | – |
| Spaceline operationsGAAP | 28,182 (In thousands) | – | – |
| Research and developmentGAAP | 4,339 (In thousands) | – | – |
| Selling, general and administrativeGAAP | 28,556 (In thousands) | – | – |
| Depreciation and amortizationGAAP | 3,983 (In thousands) | – | – |
| Total operating expensesnon-GAAP | $54 million | – | – |
| Operating lossGAAP | (64,926) (In thousands) | – | – |
| Gain on extinguishment of debtGAAP | 8,639 (In thousands) | – | – |
| Net lossGAAP | $56 million | – | – |
| Net loss per share, basic and dilutedGAAP | $ (0.50) | – | – |
| Adjusted EBITDAnon-GAAP | $(52) million | – | consistent with the second quarter of 2025 |
| Net cash used in operating activitiesGAAP | $50 million | – | – |
| Cash paid for capital expendituresother | $41 million | – | – |
| Free cash flownon-GAAP | $(91) million | – | – |
| Net cash used in operating activities, six months ended June 30GAAP | (103,673) (In thousands) | – | – |
Third Quarter 2026 and Fourth Quarter 2026 outlook
- NoteFree cash flow for the third quarter of 2026 is expected to be in the range of $(95) million to $(100) million.
- NoteFree cash flow for the fourth quarter of 2026 is expected to improve from the third quarter and be in the range of $(80) million to $(90) million.
- NotePositive quarterly cash flow expected within 2027.
- NoteFirst commercial spaceflight moves to February 2027.
- NoteCommencement of Flight Test Phase with Spaceship Captive Carry Flight (October 2026).
- NoteStart of Rocket Production (Q4 2026).
- NoteSecond spaceship planned to join the fleet in March 2027.
What drove it
- Revenue of $0.1 million was attributable to access fees related to future astronauts.
- The tranche of spaceflight expeditions priced at $750,000 was oversubscribed and booked out ahead of schedule.
- The booked expedition tranche represents an addition of over $50 million to expected future spaceflight revenue.
- The net-loss improvement was primarily driven by a gain on extinguishment of debt and lower operating expenses in 2026.
- The Company expects to release a new tranche of spaceflight expeditions at higher price points this fall.
Concerns
- Revenue was $0.1 million, compared to $0.4 million in the second quarter of 2025.
- First commercial spaceflight is now expected in February 2027 rather than the fourth quarter of 2026 to allow additional time to complete avionics and systems installations.
- Free cash flow is expected to be in the range of $(95) million to $(100) million in the third quarter of 2026 and in the range of $(80) million to $(90) million in the fourth quarter of 2026.
- The Company generated $134 million in gross proceeds through issuance of 41 million shares of common stock.
- The Company cited risks including delays in future commercial flights, the ability to successfully develop and test next generation vehicles, time and costs associated with those activities, capital requirements and availability of additional financing.
What to watch
- Commencement of the flight test phase with a Spaceship captive carry flight in October 2026.
- Start of rocket production in Q4 2026.
- Release of a new tranche of spaceflight expeditions at higher price points this fall.
- First commercial spaceflight in February 2027.
- The second spaceship planned to join the fleet in March 2027.
- The Company's expectation to deliver positive quarterly cash flow within 2027.
Balance sheet and cash flow
- Cash, cash equivalents and marketable securities of $286 million as of June 30, 2026.
- Cash and cash equivalents $187,340 (In thousands) as of June 30, 2026.
- Marketable securities 67,714 (In thousands) as of June 30, 2026.
- Restricted cash 31,072 (In thousands) as of June 30, 2026.
- Total assets $816,276 (In thousands) as of June 30, 2026.
- Total liabilities 420,162 (In thousands) as of June 30, 2026.
- Current portion of long-term debt 29,983 (In thousands) as of June 30, 2026.
- Long-term debt 189,056 (In thousands) as of June 30, 2026.
- Generated $134 million in gross proceeds through the issuance of 41 million shares of common stock as part of the Company's at-the-market offering program.
- For the notes due December 2028, the Company has no mandatory principal payments due until March 2028 following the principal reduction of $40.5 million during the second quarter of 2026.
- For the notes due February 2027, the Company reduced the outstanding principal balance by $52.5 million during the second quarter of 2026 to $17.9 million.
- Cash paid for capital expenditures totaled $41 million, compared to $58 million in the second quarter of 2025.
Analysis
Virgin Galactic's second-quarter revenue was $0.1 million, compared to $0.4 million in the second quarter of 2025, and was attributable to access fees related to future astronauts. The operating model remains pre-commercial, with the release identifying the recently sold $750,000 expedition tranche as an addition of over $50 million to expected future spaceflight revenue. Management said that tranche was oversubscribed and booked out ahead of schedule and plans to release a higher-priced tranche this fall.
Costs improved on several reported measures. GAAP total operating expenses were $65 million versus $70 million in the second quarter of 2025, while non-GAAP total operating expenses were $54 million versus $58 million. GAAP spaceline operations rose to 28,182 (In thousands) from 14,206 (In thousands), while research and development declined to 4,339 (In thousands) from 20,121 (In thousands). The Company reported a $56 million net loss compared with a $67 million net loss, citing the gain on extinguishment of debt and lower operating expenses, while adjusted EBITDA was $(52) million, consistent with the prior-year quarter.
Cash consumption moderated but remains substantial. Net cash used in operating activities totaled $50 million compared with $55 million, capital expenditures totaled $41 million compared with $58 million, and free cash flow totaled $(91) million compared with $(114) million. Cash, cash equivalents and marketable securities were $286 million as of June 30, 2026. The Company also generated $134 million in gross proceeds through 41 million shares issued under its at-the-market offering program, and it reduced principal on both the December 2028 notes and February 2027 notes.
The critical operational change is the shift of the first commercial spaceflight to February 2027 from the fourth quarter of 2026, with management citing additional avionics and systems installations. The next reported milestones are an October 2026 captive carry flight, rocket production beginning in Q4 2026, and a second spaceship planned for March 2027. Management expects negative free cash flow of $(95) million to $(100) million in the third quarter and $(80) million to $(90) million in the fourth quarter, while targeting positive quarterly cash flow within 2027. Execution against those vehicle, production and cash-flow timelines is central to the next phase of the business.
Management, verbatim
Our tranche of spaceflight expeditions priced at $750,000 was oversubscribed and booked out ahead of schedule, demonstrating strong demand from a wide range of customers. We expect to release a new tranche of spaceflight expeditions at higher price points this fall.
Michael Colglazier, CEO
Not in the filing
stated, not guessed- Prior-quarter revenue, operating expense, operating loss, net loss, EPS, adjusted EBITDA, operating cash flow, capital expenditures and free cash flow comparisons were not provided.
- GAAP gross profit and gross margin were not provided.
- Non-GAAP operating income or loss was not provided.
- Non-GAAP net income or loss and non-GAAP EPS were not provided.
- Revenue, gross margin, operating expense and tax-rate guidance were not provided.
- Segment revenue disclosures were not provided.
- Share repurchases and dividend payments were not provided.
- The filing text was truncated within the condensed consolidated statements of cash flows; investing and financing cash-flow statement line items beyond the provided text were not available.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.