Sir Richard Branson says he won’t invest any more money in his Virgin Galactic space travel company, the Financial Times reports.
The billionaire serial entrepreneur founded Virgin Galactic in 2004, but the lossmaking venture announced last month it was cutting jobs and suspending commercial flights from 2024. Branson acknowledged his wider enterprise no longer has the “deepest pockets” after the Covid-19 pandemic. Consequently, belt-tightening will save cash for developing a larger Delta plane to fly passengers within striking distance of space.
Virgin Galactic stock dips
Virgin Galactic’s space plans will only pause temporarily, with Branson confirming there’s around $1 billion to see it through to 2026 and market analysts predicting another appeal to investors in 2025. After completing its first commercial space flight (with tickets starting at $450,000), Branson believes the Unity space plane has “really proved itself”.
But the announcement shook the market nevertheless, with CNN Business reporting Virgin Galactic stock down 16% and trading at under $2 per share when the US market opened at 9 am on Monday (Dec. 5).
Branson had previously sold around $1 billion of his holdings in Virgin Galactic between 2020-21, although Virgin Group, which manages his portfolio, is still one of its biggest shareholders. The British businessman now focuses on philanthropic work such as his Virgin Unite project, a non-profit bringing communities and entrepreneurs together to drive positive change. A new incarnation, Galactic Unite, aims to inspire the next generation of astronauts by encouraging young people to pursue STEM subjects.
Virgin Galactic’s Q3 financial results reported cash, cash equivalents, and marketable securities of $1.1 billion as of Sep. 30, 2023. The next spaceflight is scheduled for January 2024, a spaceship factory in Phoenix, Arizona is set to open mid-year, and the Delta spaceship is “on track for revenue service in 2026”.
Space satellite venture Virgin Orbit filed for bankruptcy in May 2023 and its failure may have inspired a more prudent approach to Virgin Galactic investment.
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