Virgin Galactic (NYSE: SPCE) released its financial results for the third quarter of 2025, providing a detailed update on its financial health and progress toward resuming commercial spaceflight. The company, which is currently focused on producing its next-generation SpaceShip vehicles, reaffirmed its development timeline. Key projections show the flight test program remains on track to begin in the third quarter of 2026, with the first commercial spaceflight scheduled for the fourth quarter of 2026.
Financially, the quarter (which ended September 30, 2025) was marked by a significant reduction in net loss compared to the same period last year, driven by lower operating expenses. The company’s cash position remains strong, listed at $424 million. While development continues, the company also announced it has secured a new research mission with Purdue University set to fly in 2027.
Program Updates and Commercial Timeline
Virgin Galactic’s report places a heavy emphasis on its manufacturing and operational readiness. The company is in a development-heavy phase, and its forward-looking statements outline a clear path back to commercial service.
The Path to Commercial Service
The company’s schedule for its next-generation vehicles appears firm. The flight test program is set to commence in the third quarter of 2026. This testing phase is a necessary step to validate the new vehicles before they can carry passengers.
Following a successful test program, the first commercial spaceflight on the new fleet is expected to take place in the fourth quarter of 2026. This flight will be a milestone, marking the company’s return to service.
Once commercial flights begin, the cadence is expected to pick up quickly. The company stated that private astronaut flights will follow just six to eight weeks after that first commercial mission.
Manufacturing and Production Milestones
Tangible progress on the new spaceships was also reported. Virgin Galactic expects to have 90% of the structural parts for its first new SpaceShip vehicle inside its spaceship factory during the fourth quarter of 2025. This indicates that the primary build of the vehicle’s airframe is nearing completion, allowing teams to move on to component integration and systems-level work.
Ramping Up Operations and Sales
With hardware coming together, the company is also preparing its commercial operations. A new, “first tranche” of sales for spaceflights on the new ships is expected to begin in the first quarter of 2026.
This sales launch is separate from the company’s existing backlog of customers. For those who have already purchased tickets, the company expects most of them will take their journey to space during 2027. This 2027 timeline for clearing the backlog is based on the company’s confidence in its new fleet. The report mentions that the launch vehicle’s “bolstered flight rate capability,” combined with an expected quick turnaround time for the first two new SpaceShips, should allow flight capacity to ramp up fairly quickly.
New Research Mission Announced
Beyond its private astronaut business, Virgin Galactic also announced a new contract for a scientific research mission. The company will fly a mission for Purdue University in 2027, demonstrating its continued use as a platform for microgravity research.
Third Quarter 2025 Financial Performance
The company’s financial results show a disciplined approach to spending as it manages its capital through this intensive development period. The third quarter of 2025 showed improvements in profitability and cash flow compared to the third quarter of 2024.
Core Financial Health
As of September 30, 2025, Virgin Galactic reported a strong cash position. Its cash, cash equivalents, and marketable securities totaled $424 million. This capital is what funds the company’s day-to-day operations and the significant costs associated with building and testing its new fleet.
During the quarter, the company also raised additional funds. It generated $23 million in gross proceeds through the issuance of 7.4 million shares of common stock as part of its at-the-market (ATM) offering programs.
Revenue and Net Loss
Revenue for the third quarter of 2025 was $0.4 million, which was identical to the revenue from the third quarter of 2024. The company attributes this revenue to access fees related to its future astronaut customers.
The company’s bottom-line profitability improved. It reported a net loss of $64 million for the quarter. This is a significant reduction from the $75 million net loss reported in the same period last year. The press release states this improvement was primarily driven by a successful effort to lower operating expenses.
Analyzing Operating Expenses
Virgin Galactic’s report details its cost-saving measures by presenting expenses in two ways: GAAP (Generally Accepted Accounting Principles) and non-GAAP.
- GAAP Expenses: Total operating expenses under GAAP were $67 million, a notable decrease from $82 million in the third quarter of 2024.
- Non-GAAP Expenses: The company also highlighted its non-GAAP total operating expenses, which were $58 million. This was down from $70 million in the prior-year quarter. The company’s non-GAAP calculation excludes non-cash items like stock-based compensation, depreciation, and amortization, which it believes provides a clearer picture of its operational spending.
The report’s Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) also improved. It came in at a loss of $53 million, compared to a loss of $59 million in the third quarter of 2024, again reflecting the impact of lower operating expenses.
Cash Flow and Capital Expenditures
The company’s cash flow statement shows how money moved during the quarter.
Net cash used in operating activities was $56 million. This was a substantial improvement from the $79 million used in the third quarter of 2024, confirming that the company’s core operations are consuming less cash than they were a year ago.
In contrast, cash paid for capital expenditures (CapEx) increased. The company spent $51 million on CapEx, up from $39 million in the same quarter of 2024. This pattern isn’t contradictory; it aligns with the company’s narrative. While it’s cutting operational costs, it is increasing its spending on long-term assets, namely the property, plant, and equipment needed to build its new spaceships.
This combination of operating cash flow and CapEx resulted in a total “free cash flow” of negative $108 million for the quarter. This was an improvement from the negative $118 million in free cash flow reported for the third quarter of 2024. The company defines free cash flow as net cash used in operating activities minus capital expenditures.
Forward-Looking Financial Guidance
Looking ahead to the immediate future, Virgin Galactic provided a forecast for the fourth quarter of 2025.
The company expects its free cash flow for the fourth quarter to be in the range of negative $90 million to negative $100 million. This projection suggests a continued, steady, or slightly improved rate of cash burn compared to the negative $108 million reported in the third quarter.
The company notes that these projections are forward-looking statements as of November 13, 2025, and are subject to substantial uncertainty and factors that could cause results to differ.
A Deeper Look at the Financial Tables
The press release also includes detailed consolidated financial statements, which provide a broader, year-to-date context for the company’s performance through the first nine months of 2025.
Statement of Operations (Year-to-Date)
When looking at the first nine months of 2025 (ending September 30), the reduction in spending is even more pronounced. Total operating expenses for this period were $225.8 million, a significant drop from $301.3 million during the same nine-month period in 2024.
This decrease was driven by a large reduction in research and development (R&D) spending, which fell from $124.4 million in the first nine months of 2024 to $68.4 million in the first nine months of 2025. “Spaceline operations” expenses also fell, from $69.8 million to $54.5 million.
As a result of these cost-cutting measures, the company’s net loss for the first nine months of 2025 was $216.2 million. This is a notable improvement from the $270.3 million net loss recorded during the same period in 2024.
Balance Sheet Highlights
The company’s balance sheet provides a snapshot of its assets and liabilities, comparing its position on September 30, 2025, to the end of 2024 (December 31, 2024).
Total assets decreased from $961.2 million at the end of 2024 to $853.5 million. This drop is almost entirely explained by the company’s cash burn. Its combined “cash and cash equivalents” and “marketable securities” (both short and long-term) fell from approximately $624.5 million to $393.6 million.
However, this was offset by a very large increase in “property, plant and equipment,” which grew from $209.1 million to $350.1 million. This shift clearly illustrates the company’s strategy: it’s converting its cash on hand into tangible assets like its new spaceship factory and the vehicles themselves.
On the other side of the ledger, total liabilities were stable, decreasing slightly from $638.9 million to $627.6 million. A key item, “customer deposits,” which represents the value of tickets sold to future astronauts, saw a small dip from $84.5 million to $80.2 million.
Cash Flow Statement (Year-to-Date)
The cash flow statement for the first nine months of 2025 tells a complete story.
- Operating Activities: The company used $187.7 million in cash for its operations, which is a major improvement from the $271.7 million it used in the same period of 2024.
- Investing Activities: The company spent $155.9 million on capital expenditures (CapEx). It also sold off more marketable securities than it purchased, resulting in net cash provided by investing activities of $29.9 million.
- Financing Activities: The company gained $105.7 million from financing activities, almost entirely from the $109.2 million it raised by issuing new common stock.
These three streams combined resulted in a net decrease in total cash, cash equivalents, and restricted cash of $52.1 million over the first nine months of the year.
Summary
Virgin Galactic’s third-quarter 2025 report portrays a company in a focused development phase. It is successfully controlling its operational spending, leading to a smaller net loss than in the previous year. It is funding its operations by spending its significant cash reserves and by issuing new stock to investors. This capital is being directly invested in the tangible assets – factories and vehicles – required for its next generation of spaceships.
Operationally, the company is holding firm to its previously stated timeline. It is projecting a return to flight testing in the third quarter of 2026 and a resumption of commercial service in the fourth quarter of 2026. With new sales set to begin early next year and a new research mission for Purdue University added to its manifest, the company is building a foundation for its planned ramp-up of flights in 2027.
