Virgin Galactic(SPCE)2024-11-07 00:22Financial Data and Key Metrics Changes - Revenue for Q3 2024 was 82 million, down from 116 million in the prior year period, primarily due to lower R&D and SG&A expenses [21] - Capital expenditures for the quarter increased to 39 million from 118 million in Q3 2024, compared to negative $105 million in the same period last year [22] Business Line Data and Key Metrics Changes - The company is in the build phase of its spaceship program, focusing on building tools, fabricating parts, and assembling spaceships, with assembly expected to commence in Q1 2025 [6][12] - The first two Delta spaceships are projected to generate positive operating cash flow, which can be used for organic fleet expansion [24] Market Data and Key Metrics Changes - The company anticipates that the addition of a second mothership and two additional spaceships will significantly enhance its capacity and profitability, with expectations to double revenue and quadruple EBITDA [25][46] Company Strategy and Development Direction - The company is focused on expanding its fleet beyond the first two spaceships to capture economies of scale and enhance profitability [7][18] - The strategy includes targeted use of growth capital to accelerate fleet expansion, with a goal to achieve a fully utilized spaceport by 2028 [27][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the customer experience and business model, planning to accelerate economic expansion through growth capital [9][10] - The company remains on track for commercial operations to begin in 2026, with a strong cash position providing flexibility for growth capital acquisition [10][23] Other Important Information - The company is ramping up hiring in the Phoenix Mesa area in preparation for spaceship assembly, focusing on key personnel to support the build phase [16] - The company has refined its schedules to manage tool deliveries, parts fabrication, and assembly sequences effectively [17] Q&A Session Summary Question: What is the latest thinking on reopening ticket sales? - Management indicated that ticket sales will likely open towards the back half of 2025, as they want to ensure they are supply constrained relative to demand [31][32] Question: Any additional equity issuance for the mothership program? - Management clarified that while they have enough cash to bring the first two Delta ships into service, they see an opportunity to bring in growth capital to accelerate expansion [34][35] Question: Thoughts on tariffs and sourcing risks? - Management believes they are reasonably insulated from tariffs as most efforts are based in the U.S., and partnerships with Bell and Qarbon are progressing well [38][39] Question: What is the timing for the second mothership? - Management confirmed that the second mothership and the third and fourth Delta ships are targeted for 2028, aligning with their growth strategy [58][59] Question: How is Delta Class progressing relative to the initial budget? - Management reported that Delta Class is tracking well against the initial budget, with active spending management contributing to lower cash burn expectations [66][67]