Founded in 2017, Virgin Orbit is one of many rocket companies that have sprung up over the past few decades, along with space tourism provider Virgin Galactic, which belongs to billionaire Richard Branson's Virgin Group.
Virgin Orbit is dedicated to the launch of small and medium-sized satellites. Compared to its competitors, the company's approach to sending these satellites into space is somewhat unique.
Instead of launching vertically from the ground, Virgin Orbit's rockets were launched by fixing the LauncherOne launch vehicle under the wings of a Boeing 747 four-zero called The Cosmic Girl.
The LauncherOne rocket is 21 meters long and has been under development since 2007 and is planned to launch small satellites of three hundred to five hundred kilograms. After the Cosmic Girl system took the LauncherOne rocket to an altitude of thirty-five thousand feet, the rocket disengaged from it, igniting the main engine and propelling its payload into Earth orbit.
On May 25, 2020, Virgin Orbit's first orbital test failed due to a burst of fuel lines for the rocket's first stage. On January 17, 2021, LauncherOne successfully deployed 10 CubeSats to low Earth orbit for NASA.
On June 30, 2021, LauncherOne completed its first commercial launch mission, successfully launching small satellites belonging to the U.S. Department of Defense and the Royal Netherlands Air Force into a scheduled orbit. On January 14, 2022, Virgin Orbit completed its fourth launch, codenamed Above cloud, and successfully launched 7 small satellites for the US Department of Defense, NASA and so on.
The average interval between Virgin Rail's two launches is about six months. In order to provide customers with better launch services, it is necessary to speed up the pace of launches. So far, Virgin Orbit CEO Dan Hart said the goal this year is to make six launches, which will be double the number in the past.
While Virgin Orbit's goal is to try to catch up with Space X, which Musk founded, it's actually hard to achieve. On the same day as Virgin orbit, Space X's second launch mission of the year, Transformer-3, successfully launched up to 105 satellites into space orbit in one go through the legendary Falcon 9.
After the successful launch of the Cloud program, Virgin Orbit rose 2.87% after hours to $9.67.
At the same time, the company is trying to find other ways to generate revenue. For example, the entire air launch system is made into a recording procedure and then sold to the government. In addition, in 2023 the company plans to launch its own satellite to provide commercial services to customers who want to use its features. There is also the provision of value-added services, including the Internet of Things, and Earth observation applications.
But fundamentally, Virgin Track's finances don't seem too optimistic. In the most recent quarter, the company had revenue of just $160,000. This compares to revenue of $1.17 million in the year-ago quarter. While the company's business did decline, it's worth noting that total revenue improved in 2021.
Sales were $7.39 million. That's almost double Virgin Rail's $3.84 million in 2020. But for a $2.46 billion business, it's quite disappointing.
By the end of 2021, the company's backlog of orders will increase to $575 million. By comparison, the figure released a year ago was just $86 million.
The increase in orders is good news, indicating the confidence of customers in Virgin Track and strengthening the determination of some investors. This is very important because fundamentally, Virgin Rail doesn't have much value at the moment, but it's likely that there's a lot of potential in the future.
Virgin Rail's assets may now be well below its trading value. Assessing its prospects from a purely theoretical point of view, it generates neither enough revenue nor sufficient cash flow to justify its valuation.
If you want to succeed in the next few years to occupy a considerable share in a huge and growing market. The company would need to invest at least hundreds of millions of dollars more to reach its expected target. So it may not be wise for investors to bet heavily on Virgin today.