Reservations for Virgin’s space tourist flights will open Wednesday.
Courtesy Virgin Galactic
Space tourism pioneer Virgin Galactic is getting closer to commercial operations. The company said Tuesday that ticket sales for its space flight will open to the general public on Wednesday. The announcement should excite aspiring astronauts and thrill investors.
Virgin Galactic (ticker: SPCE) stock was up more than 12% in premarket trading Tuesday. S&P 500 and Dow Jones Industrial Average futures rose about 1.4% and 1.1%, respectively.
The stock is jumping because the start of commercial operations has been a long time coming. Delays due to spacecraft testing sent shares plummeting shortly after they soared around the time the company sent founder Sir Richard Branson into space.
Coming into Tuesday trading, shares have dropped about 86% from their 52-week high in June 2021 of $57.51 a share. That high was hit a few weeks before Branson’s flight.
Tuesday’s announcement is a relief for investors. Management is upbeat about progress made.
“At Virgin Galactic, we believe that space is transformational,” said CEO Michael Colglazier in the company’s news release. “We plan to have our first 1,000 customers on board at the start of commercial service later this year, providing an incredibly strong foundation as we begin regular operations and scale our fleet.”
Space flight isn’t going to be cheap. The ticket price listed is $450,000 with a $150,000 deposit. That means a thousand customers could generate about $450 million in sales. “On board” in this instance isn’t literal and refers to sign-ups. Wall Street projects the company will generate about $8 million in sales during 2022. Taking that many people into space will require hundreds of flights and take many months.
Still, investors will be pleased if the company can get its backlog to that level. And deposits will also generate about $150 million in working capital for the company.
How fast reservations fill up will be a good test for the fledgling space tourism industry and for Virgin Galactic’s product offering.
Write to Al Root at [email protected]
