Virgin Galactic Holdings, Inc
For the period ended Dec 31, 2025. Filed Mar 30, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 30, 2026
SPCE$2.77+16.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-26.
0001706946-25-000038
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-30.
0001706946-26-000019
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 102 previous paragraphs and 110 current paragraphs.
52 unchanged; 23 reworded; 33 added; 24 removed; 3 previous and 2 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (33)
Current report
We are continuing the production of our next-generation spaceships and are progressing through our build milestones. We currently expect our flight test program to commence in the third quarter of 2026 in advance of restarting commercial service, which is expected to begin in the fourth quarter of 2026 with a research flight. We currently expect private astronaut spaceflights to commence six to eight weeks after our first commercial spaceflight.
Current report
In December 2025, we entered into separate, privately negotiated repurchase agreements (the “2027 Notes Repurchase Agreements”) with a limited number of holders of our 2.50% convertible senior notes due 2027 (the “2027 Notes”), pursuant to which we repurchased $354.6 million in aggregate principal amount of the 2027 Notes. See Note 8 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
Current report
Spaceline operations expense decreased from $90.0 million for the year ended December 31, 2024 to $72.8 million for the year ended December 31, 2025. The decrease was primarily driven by an $18.9 million decrease in cash compensation and other employee benefit costs and a $1.6 million decrease in facility costs. These decreases were partially offset by a $2.7 million increase in materials and sub-contractor and contract labor costs.
Current report
fees and outside services and a $3.4 million decrease in cash compensation and other employee benefit costs, partially offset by a $2.3 million expense associated with the proposed settlement of a class action lawsuit.
Current report
Debt Restructuring Expense
Current report
Debt restructuring expense of $2.8 million for the year ended December 31, 2025 relates to costs incurred in connection with the 2027 Notes Repurchase Agreements. See Note 8 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
Current report
Net cash provided by financing activities was $114.1 million for the year ended December 31, 2025, and consisted primarily of proceeds from issuance of long-term debt of $212.5 million, net cash proceeds from the sale and issuance of common stock pursuant to our at-the-market offering programs of $118.1 million, proceeds from the issuance of purchase warrants of $62.5 million, and proceeds from the issuance of common stock and pre-funded warrants of $45.6 million related to our registered direct offering, partially offset by the repurchase of our convertible debt of $320.6 million, transaction costs related to issuance of common stock and equity-classified warrants of $2.2 million and debt issuance costs of $1.8 million.
Current report
For information regarding our cash requirements for contractual obligations, indebtedness and lease obligations, see Notes 6, 9 and 16 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Current report
During the year ended December 31, 2025, we sold 33.5 million shares of common stock under the 2024 ATM Program and generated $121.6 million in gross proceeds, before deducting $3.5 million in underwriting discounts, commissions and other expenses.
Current report
Debt Obligations
Current report
As of December 31, 2024, we had $425 million outstanding under the 2027 Notes that had a maturity date of February 1, 2027. During 2025, we evaluated alternative financing arrangements to refinance the 2027 Notes. Our primary objective was to extend the maturity of our contractual debt obligations to better align with the planned growth in our spaceline commercial operations, which is expected to commence commercial service in the fourth quarter of 2026.
Current report
As a result of the Capital Transactions (as defined below), we extended the maturity for a majority of our contractual debt obligations to December 31, 2028. In addition, the outstanding balance for our contractual debt obligations was reduced by $142.1 million.
Current report
A summary of the maturities and mandatory payments of the contractual debt outstanding is as follows:
Current report
2025 Capital Realignment Transactions
Current report
In December 2025, we completed privately negotiated repurchase agreements (the “2027 Notes Repurchase Agreements”) with a limited number of holders of our 2027 Notes, pursuant to which we repurchased $354.6 million in aggregate principal amount of our 2027 Notes (the “Repurchases”) with cash proceeds received from the Registered Offering (as defined below) and the Private Placement (as defined below).
Current report
Concurrently with the Repurchases, we completed the issuance and sale for cash in a registered direct offering, pursuant to separate, privately negotiated subscription agreements with certain investors, of (i) 2.2 million shares of our common stock, and (ii) pre-funded warrants (the “Pre-Funded Warrants”) to purchase 8.4 million shares of our common stock (collectively, the “Registered Offering”). In connection with the Registered Offering, we received cash proceeds of $45.6 million.
Current report
The Pre-Funded Warrants are exercisable at any time on or after December 29, 2025 at an exercise price of $0.0001 per share. The Pre-Funded Warrants contain a cashless exercise feature that allows the holders to exercise the Pre-Funded Warrants without a cash payment to us upon the terms set forth therein. The number of shares of common stock for which the Pre-Funded Warrants are exercisable are subject to certain additional customary adjustments as set forth in the Pre-Funded Warrants. As of December 31, 2025, 4.3 million shares of common stock had been issued in connection with the exercise of the Pre-Funded Warrants. All Pre-Funded Warrants had been exercised by January 29, 2026.
Current report
Concurrently with the Registered Offering, we issued and sold for cash, in a private placement, (i) $212.5 million aggregate principal amount of a new series of our 9.80% First Lien Notes due 2028 (the “2028 Notes”) and (ii) warrants, with a fair value of $62.5 million, to purchase 31.7 million shares of our common stock (the “Purchase Warrants”), with an exercise price equal to $6.696 per share (collectively, the “Private Placement”, and together with the Repurchases and Registered Offering, the “Capital Transactions”). The Purchase Warrants are exercisable at any time on or after June 18, 2026 until December 18, 2030. The Purchase Warrants are exercisable only for cash and are subject to appropriate adjustment in the event of cash or share dividends, share splits, share repurchases, reorganizations or similar events affecting our common stock.
Current report
We are currently in the pre-commercial service phase and accordingly have no spaceflight revenue. We expect to generate revenue from our spaceflight program once commercial service begins. We currently expect the flight test program of our next-
Current report
generation spaceships to commence in the third quarter of 2026, followed by our first commercial spaceflight which is expected to occur in the fourth quarter of 2026. Before recognizing revenue for commercial spaceflights, we expect to receive cash payments in connection with spaceflights after we deliver the conditions of carriage to customers and receive customer executed informed consents.
Current report
We have recently used significant cash for operating activities and capital expenditures primarily related to the development of our next-generation spaceships and expect to continue to incur significant operating expenses and capital expenditures to complete the production of these spaceships and place them into commercial operation. We expect our future expenditures to continue to decrease in connection with our ongoing activities in the near term, particularly since we have completed investments in tooling to produce our spaceships and expect to complete the assembly of our initial next-generation spaceship ahead of its flight test program, which is expected to commence in the third quarter of 2026. As we move into commercial operations with our first commercial spaceflight expected in the fourth quarter of 2026, we expect increases in cash receipts and expenditures as we ramp and operate our spaceline commercial business.
Current report
Our plans to fund our operations for the next twelve months include implementing some or all of the following initiatives:
Current report
•Commencing commercial service in the fourth quarter of 2026, as currently planned.
Current report
•Generating significant cash from the current backlog of future astronauts as their final payments become due in advance of their spaceflight.
Current report
•Offering the sale of a limited number of early spaceflights at a premium to historical prices.
Current report
•Increasing cash on hand through additional debt or equity financing, including use of our existing “at-the-market” equity offering program.
Current report
•Partnering with third parties to fund and accelerate the pace of future space vehicle development.
Current report
•Settling debt through the issuance of equity and/or extending maturities of certain debt payments that are due within the period.
Current report
The plans discussed above are subject to market conditions and, while we intend to apply our best efforts to the execution of these plans, they are not fully within our control. As a result, it is uncertain whether we will have sufficient cash and marketable securities to maintain our planned operations for the next twelve months following the issuance date of the consolidated financial statements and we have concluded that there are conditions present in the aggregate that raise substantial doubt about our ability to continue as a going concern.
Current report
There are significant risks and uncertainties associated with our planned operations and there is no assurance that our future plans will be successful or, if successful, will be sufficient to fully fund our planned operations. For more information regarding our risks and uncertainties, see the section of this Annual Report on Form 10-K titled“Risk Factors.”
Current report
Warrants
Current report
Warrants are accounted for as either equity-classified or liability-classified instruments based on an assessment of their specific terms. The assessment considers whether the warrants are freestanding financial instruments and whether the warrants meet all of the requirements for equity classification, including whether the warrants are indexed to the Company's own common stock. Warrants that meet all of the criteria for equity classification are recorded in stockholders' equity at fair value as of the date of issuance and are not remeasured to fair value in subsequent reporting periods.
Current report
Warrants that do not meet the criteria for equity classification are recorded as liabilities at fair value, with changes in fair value recognized in earnings each reporting period.
Removed paragraphs (24)
Previous report
In January 2024, we completed our sixth commercial spaceflight,'Galactic 06,'marking the first time all four seats aboard VSS Unity were occupied by private astronauts.
Previous report
In June 2024, we completed our second spaceflight of 2024 and seventh commercial spaceflight to date,'Galactic 07,'carrying one researcher and three private astronauts. Following the'Galactic 07'flight, we paused Unity spaceflights and expect to commence flying with test flights of our new Delta Class spaceships in advance of restarting commercial service, which is expected to begin in 2026.
Previous report
On June 12, 2024, at the Company’s 2024 annual meeting of stockholders, our stockholders approved, and on June 14, 2024, we effected, a 1-for-20 reverse stock split (the “Reverse Stock Split”), and our common stock began trading on a split-adjusted basis on June 17, 2024. Prior to the Reverse Stock Split, on May 29, 2024, we received a notice from the New York Stock Exchange (the “NYSE”) that we were no longer in compliance with Section 802.01C of the NYSE Listed Company Manual (“Section 802.01C”), which requires listed companies to maintain an average closing price per share of at least $1.00 over a 30 consecutive trading-day period. Following the Reverse Stock Split, on July 1, 2024, we received a letter from the NYSE stating that we regained compliance with Section 802.01C.
Previous report
All shares of our common stock, per-share data and related information included in this Annual Report on Form 10-K have been retroactively adjusted as though the Reverse Stock Split had been effected prior to all periods presented.
Previous report
In July 2024, we completed our new manufacturing facility in Arizona, where final assembly of our next-generation Delta Class spaceships is scheduled to begin in 2025. After the initial development of our first Delta Class spaceship, we estimate the recurring cost to make each additional spaceship to be between $50 and $60 million.
Previous report
In October 2024, we settled the lawsuit and all claims between us and The Boeing Company and Aurora Flight Sciences Corporation, a Boeing Company. See Note 15 in our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
Previous report
In December 2024, we entered into an Agreement of Cooperation with Ente Nazionale per l'Aviazione Civile, the civil aviation authority of Italy, to jointly study the feasibility of conducting spaceflight operations from Grottaglie Spaceport in the Puglia region of Southern Italy.
Previous report
Following the launch of commercial service and achievement of technological feasibility in July 2023, we began presenting the operating expenses supporting our commercial spaceline activities as spaceline operations expense in the accompanying consolidated statements of operations and comprehensive loss. Prior to achievement of technological feasibility, spaceline operations expense included costs to support our astronaut community and costs related to payload cargo and engineering services.
Previous report
and other professional fees, a $4.2 million decrease in marketing and promotion expense, and a $1.7 million decrease in facility costs.
Previous report
Special Charges
Previous report
In November 2023, we commenced a restructuring plan designed to decrease costs and strategically realign our resources. In connection with this plan, we announced a workforce reduction of approximately 185 employees, constituting approximately 18% of our workforce. As a result, we recorded $4.4 million in severance and related benefit costs for the involuntarily terminated employees as special charges during the year ended December 31, 2023.
Previous report
In January 2024, we fully paid the $1.4 million liability balance associated with these costs that was accrued at December 31, 2023.
Previous report
We lease certain facilities and assets under non-cancellable operating lease arrangements that expire at various dates through 2065. As of December 31, 2024, future minimum payments under non-cancellable operating leases were $120.6 million. For additional information regarding our lease obligations, see Note 15 in our consolidated financial statements included in Item 8 of this Annual Report in Form 10-K.
Previous report
Funding Requirements
Previous report
We expect our expenditures to fluctuate in connection with our ongoing activities, particularly as we continue to advance the development of our next-generation spaceflight system and leverage investments in capital expenditures.
Previous report
As our fleet of spaceships expands, we expect our expenditures to increase as we scale our commercial operations. Specifically, our long-term expenditures will increase as we:
Previous report
•scale up our manufacturing processes and capabilities to support expanding our fleet with additional spaceships, carrier aircraft and rocket motors in connection with commercialization;
Previous report
•hire additional personnel in manufacturing operations, testing programs, maintenance operations and guest services as we increase the volume of our spaceflights; and
Previous report
•scale up required operational facilities, such as hangars and warehouses;
Previous report
We expect our arrangements with third-party providers to manufacture key subassemblies for our next-generation spaceships and for the design and manufacture of our next-generation carrier aircraft will require significant capital expenditures. Certain estimated amounts in connection with third-party arrangements are subject to future negotiations and cannot be estimated with reasonable certainty.
Previous report
We believe that our current capital is adequate to sustain our operations for at least the next twelve months. Changing circumstances may cause us to consume capital significantly faster than we currently anticipate, and we may need to spend more money than currently expected because of circumstances beyond our control. While we have completed our initial commercial launch with a single spaceship, we are currently developing our next-generation spaceflight vehicles. We anticipate the costs to manufacture additional vehicles will begin to decrease as we continue to scale up our manufacturing processes and capabilities.
Previous report
We completed the 2022 ATM Program in June 2023, selling a total of 3.0 million shares of common stock and generating $300 million in gross proceeds, before deducting $3.0 million in underwriting discounts, commissions and other expenses.
Previous report
For at least the next twelve months, we expect our principal demand for funds will be for our ongoing activities described above. We expect to meet our short-term liquidity requirements primarily through our cash, cash equivalents and marketable securities on hand. We believe we will have sufficient liquidity available to fund our business needs, commitments and contractual obligations for the next twelve months.
Previous report
The commercial launch of our spaceflight program and the anticipated expansion of our fleet have unpredictable costs and are subject to significant risks, uncertainties and contingencies, many of which are beyond our control, that may affect the timing and magnitude of these anticipated expenditures. Some of these risk and uncertainties are described in more detail in this Annual Report on Form 10-K under the heading Item 1A. “Risk Factors—Risks Related to Our Business.”
Reworded paragraphs (23)
Previous wording
We are an aerospace and space travel company offering access to space for private individuals, researchers and government agencies. Our missions include flying passengers to space, as well as flying scientific payloads and researchers to space in order to conduct experiments for scientific and educational purposes. Our operations include the design and development, manufacturing, ground and flight testing, spaceflight operation, and post-flight maintenance of our spaceflight system. Our spaceflight system was developed using our proprietary technology and processes and is focused on providing space travel experiences for private astronauts, researcher flights and professional astronaut training. We have also leveraged our knowledge and expertise in manufacturing spaceships to occasionally perform engineering services for third parties.
Current wording
We are an aerospace and space travel company offering access to space for private individuals, researchers and government agencies. Our missions include flying passengers to space, as well as flying scientific payloads and researchers to space in order to conduct experiments for scientific and educational purposes. Our operations include the design and development, manufacturing, ground and flight testing, spaceflight operation and post-flight maintenance of our spaceflight system. Our spaceflight system was developed using our proprietary technology and processes and is focused on providing space travel experiences for private astronauts, researcher flights and professional astronaut training. We have also leveraged our knowledge and expertise in manufacturing spaceships to occasionally perform engineering services for third parties. To expand capacity, we are currently developing our next-generation spaceflight vehicles. These spaceflight vehicles, which include our next-generation spaceships and launch vehicles, are expected to dramatically increase our annual flight rate. Following the completion of the non-recurring engineering work on our next-generation spaceships, we have redeployed engineering resources to the next phase of design for our next-generation launch vehicle. In addition, we are exploring the opportunity to use a derivative model of our launch vehicle as a High-Altitude, Long-Endurance (“HALE”) aircraft, which we believe could be utilized for several types of government and research purposes.
Previous wording
We have already received significant interest from potential astronauts. Going forward, we expect the size of our backlog and the number of astronauts that have flown to space on our spaceflight system to be an important indicator of our future performance. As of December 31, 2024, we have reservations for spaceflights for approximately 700 future astronauts, which represent approximately $190 million in expected future spaceflight revenue upon completion of the spaceflights.
Current wording
We have already received significant interest from potential astronauts. Going forward, we expect the size of our backlog and the number of astronauts that have flown to space on our spaceflight system to be an important indicator of our future performance. We have recently reopened ticket sales for a tranche of spaceflight reservations at a higher base price per seat. As of December 31, 2025, we have reservations for spaceflights for approximately 675 future astronauts, which represent approximately $188 million in expected future spaceflight revenue upon completion of the spaceflights.
Previous wording
In 2023, we commenced our commercial operations with VSS Unity and VMS Eve, which together comprised our initial commercial spaceflight system. Our annual flight rate is constrained by the availability and capacity of this commercial spaceflight system. To expand capacity, we are currently developing our next-generation spaceflight vehicles. These next-generation spaceflight vehicles, which include our Delta Class spaceships and additional motherships, are expected to dramatically increase our annual flight rate.
Current wording
In 2023, we commenced our commercial operations with VSS Unity and VMS Eve, which together comprised our initial commercial spaceflight system. Our annual flight rate was constrained by the availability and capacity of this commercial spaceflight system. To expand capacity, we developed and are assembling our next-generation spaceships. These spaceships are expected to dramatically increase our annual flight rate. With our first two next-generation spaceships, we expect to ramp to a targeted rate of 125 commercial space missions per year.
Previous wording
Our spaceflight systems are highly specialized with sophisticated and complex technology. We have built operational processes to ensure that the design, manufacture, performance and servicing of our spaceflight systems meet rigorous quality standards. However, our spaceflight systems are still subject to operational and process risks, such as manufacturing and design issues, human errors, or cyber-attacks. Any actual or perceived safety issues may result in significant reputational harm to our business and our ability to generate spaceflight revenue.
Current wording
Our spaceflight systems are highly specialized with sophisticated and complex technology. We have built operational processes to ensure that the design, manufacture, performance and service of our spaceflight systems meet rigorous quality standards. However, our spaceflight systems are still subject to operational and process risks, such as manufacturing and design issues, human errors, or cyber-attacks. Any actual or perceived safety issues may result in significant reputational harm to our business and our ability to generate spaceflight revenue.
Previous wording
Revenue for the years ended December 31, 2024 and 2023 were primarily attributable to revenue generated from our commercial spaceflights and access fees related to our astronaut community.
Current wording
Revenue for the year ended December 31, 2025 was primarily attributable to access fees related to our astronaut community. Revenue for the year ended December 31, 2024 was primarily attributable to revenue generated from our commercial spaceflights and access fees related to our astronaut community.
Previous wording
Research and development expenses represent costs incurred to support activities that advance our future fleet towards commercialization, including basic research, applied research, concept formulation studies, design, development, and related testing activities. Research and development costs consist primarily of equipment, material, and labor costs (including from third-party contractors) for designing the spaceflight system’s structure, spaceflight propulsion system, and flight profiles for our next-generation spaceships and motherships, as well as allocated facilities and other supporting overhead costs.
Current wording
Research and development expenses represent costs incurred to support activities that advance our future fleet towards commercialization, including basic research, applied research, concept formulation studies, design, development, and related testing activities. Research and development costs consist primarily of equipment, material, and labor costs (including from third-party contractors) for designing the spaceflight system’s structure, spaceflight propulsion system, and flight profiles for our next-generation spaceships and launch vehicles, as well as allocated facilities and other supporting overhead costs.
Previous wording
Research and development expenses decreased from $295.1 million for the year ended December 31, 2023 to $152.7 million for the year ended December 31, 2024. The decrease was primarily driven by a $65.8 million decrease in cash compensation and other employee benefit costs primarily due to the completion of the VSS Unity and VMS Eve modifications, a reduction in headcount and labor allocated to capitalizable Delta projects; a $49.3 million decrease in materials, consulting, and other costs primarily due to the completion of the VSS Unity and VMS Eve modifications; the settlement of certain disputed vendor invoices, resulting in a reversal of $18.6 million of accrued costs; an $8.3 million decrease in other operational costs primarily due to a technology license fee expensed in 2023; and a $5.2 million decrease in consulting and other professional fees. These decreases were partially offset by a $7.8 million increase in sub-contractor and contract labor costs associated with the development of our next-generation spaceflight vehicles.
Current wording
Research and development expenses decreased from $152.7 million for the year ended December 31, 2024 to $80.5 million for the year ended December 31, 2025. The decrease was primarily driven by a $63.1 million decrease in sub-contractor and contract labor costs associated with the development of our next-generation spaceflight vehicles and an $8.1 million decrease in cash compensation and other employee benefit costs.
Previous wording
Selling, general and administrative expenses decreased from $174.9 million for the year ended December 31, 2023 to $125.5 million for the year ended December 31, 2024. The decrease was primarily driven by a $33.7 million decrease in cash compensation and other employee benefit costs primarily due to a reduction in headcount, a $8.9 million decrease in consulting
Current wording
Selling, general and administrative expenses decreased from $125.5 million for the year ended December 31, 2024 to $117.2 million for the year ended December 31, 2025. The decrease was primarily driven by a $6.7 million decrease in professional
Previous wording
Depreciation and amortization expense increased from $13.4 million for the year ended December 31, 2023 to $15.5 million for the year ended December 31, 2024. The increase was primarily due to the acquisition of property, plant and equipment.
Current wording
Depreciation and amortization expense increased from $15.5 million for the year ended December 31, 2024 to $16.5 million for the year ended December 31, 2025. The increase was primarily due to the acquisition of property, plant and equipment.
Previous wording
Interest income increased from $42.2 million for the year ended December 31, 2023 to $42.4 million for the year ended December 31, 2024. Interest income was driven by investment returns on our marketable securities and deposits in interest-bearing accounts.
Current wording
Interest income decreased from $42.4 million for the year ended December 31, 2024 to $21.8 million for the year ended December 31, 2025. The decrease was primarily driven by decreased average balances of marketable securities and deposits in interest-bearing accounts.
Previous wording
Interest expense was $12.9 million for each of the years ended December 31, 2024 and 2023. Interest expense primarily consisted of interest expense and amortization of debt issuance costs related to our convertible senior notes.
Current wording
Interest expense decreased slightly from $12.9 million for the year ended December 31, 2024 to $12.8 million for the year ended December 31, 2025. Interest expense primarily consists of interest expense and amortization of debt issuance costs related to our convertible notes, as well as our new first lien notes that were issued in December 2025.
Previous wording
Income tax expense was immaterial for the years ended December 31, 2024 and 2023. We have accumulated net operating losses at the U.S. federal and state levels. We maintain a full valuation allowance against our net U.S. federal and state deferred tax assets. The income tax expense was primarily related to corporate income taxes for our operations in the United Kingdom, which operates on a cost-plus arrangement.
Current wording
Income tax expense was immaterial for the years ended December 31, 2025 and 2024. We have accumulated net operating losses at the U.S. federal and state levels. We maintain a full valuation allowance against our net U.S. federal and state deferred tax assets. The income tax expense is primarily related to corporate income taxes for our operations in the United Kingdom, which operates on a cost-plus arrangement.
Previous wording
As of December 31, 2024, we had total cash, cash equivalents and restricted cash of $210.9 million and total marketable securities of $445.9 million. Our principal sources of liquidity have come from sales of our common stock and offering of convertible senior notes ("2027 Notes").
Current wording
As of December 31, 2025, we had total cash, cash equivalents and restricted cash of $175.7 million and total marketable securities of $162.3 million. Our principal sources of liquidity have come from sales of our common stock and offering of the 2027 Notes.
Previous wording
Net cash used in operating activities was $448.2 million for the year ended December 31, 2023, and consisted primarily of $502.3 million of net losses, adjusted for non-cash items, which primarily included stock-based compensation expense of $44.3 million, depreciation and amortization expense of $13.4 million, and $7.9 million of net changes in operating assets and liabilities, partially offset by $15.1 million of accretion of marketable securities purchased at a discount.
Current wording
Net cash used in operating activities was $240.1 million for the year ended December 31, 2025, and consisted primarily of $278.9 million of net losses, adjusted for non-cash items, which primarily included stock-based compensation expense of $18.7 million and depreciation and amortization expense of $16.5 million, as well as $7.4 million of net changes in operating assets and liabilities, partially offset by $6.1 million of accretion of marketable securities purchased at a discount.
Previous wording
Net cash used in operating activities was $352.7 million for the year ended December 31, 2024, and consisted primarily of $346.7 million of net losses, adjusted for non-cash items, which primarily included stock-based compensation expense of $29.8 million and depreciation and amortization expense of $15.5 million, partially offset by $16.6 million of accretion of marketable securities purchased at a discount and $38.2 million of net changes in operating assets and liabilities, which were driven primarily by the reversal of $18.6 million of accrued costs in connection with the settlement of certain disputed vendor invoices.
Current wording
Net cash used in operating activities was $352.7 million for the year ended December 31, 2024, and consisted primarily of $346.7 million of net losses, adjusted for non-cash items, which primarily included stock-based compensation expense of $29.8 million, depreciation and amortization expense of $15.5 million, partially offset by $16.6 million of accretion of marketable securities purchased at a discount and $38.2 million of net changes in operating assets and liabilities, which were driven primarily by the reversal of $18.6 million of accrued costs in connection with the settlement of certain disputed vendor invoices.
Previous wording
Net cash used in investing activities was $116.3 million for the year ended December 31, 2023, and consisted of $1.0 billion in purchases of marketable securities and $44.3 million in capital expenditures, partially offset by $937.9 million in proceeds from maturities and calls of marketable securities.
Current wording
Net cash provided by investing activities was $90.8 million for the year ended December 31, 2025, and consisted primarily of $601.9 million in proceeds from maturities and calls of marketable securities, partially offset by $313.0 million in purchases of marketable securities and $198.0 million in capital expenditures. The capital expenditures were primarily driven by costs associated with our next-generation spaceships.
Previous wording
Net cash provided by investing activities was $175.7 million for the year ended December 31, 2024, and consisted primarily of $543.4 million in purchases of marketable securities and $121.9 million in capital expenditures, partially offset by $840.3 million in proceeds from maturities and calls of marketable securities. The capital expenditures were primarily driven by costs associated with our next-generation Delta spaceships and our new facility in Arizona, which will be used to assemble the spaceships.
Current wording
Net cash provided by investing activities was $175.7 million for the year ended December 31, 2024, and consisted primarily of $840.3 million in proceeds from maturities and calls of marketable securities, partially offset by $543.4 million in purchases of marketable securities and $121.9 million in capital expenditures. The capital expenditures were primarily driven by costs associated with our next-generation spaceships and our new spaceship assembly facility in Arizona.
Previous wording
In August 2022, we entered into a distribution agency agreement with Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC (each, an “Agent” and collectively, the “Agents”) providing for the offer and sale of up to $300 million of shares of our common stock from time to time through the Agents, acting as sales agents, or directly to one or more of the Agents, acting as principal(s), through an "at-the-market offering" program (the "2022 ATM Program").
Current wording
In June 2023, we entered into a distribution agency agreement with Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC (each, an “Agent” and collectively, the “Agents”) providing for the offer and sale of up to $400 million of shares of our common stock from time to time through the Agents, acting as sales agents, or directly to one or more of the Agents, acting as principal(s), through an “at-the-market offering” program (the “2023 ATM Program”).
Previous wording
As of December 31, 2024, we sold a total of 4.1 million shares of common stock under the 2024 ATM Program, generating $29.1 million in gross proceeds since its inception, before deducting $0.9 million in underwriting discounts, commissions and other expenses.
Current wording
As of December 31, 2025, we had sold a total of 37.6 million shares of common stock under the 2024 ATM Program, generating $150.7 million in gross proceeds since its inception, before deducting $4.4 million in underwriting discounts, commissions and other expenses.
Previous wording
Beyond the next twelve months, our principal demand for funds will be to sustain our operations, operate our spaceline at Spaceport America in New Mexico, and expand our fleet of spaceships, motherships, and supporting facilities. We expect to generate revenue from our spaceflight program, which is expected to restart in 2026. To the extent this source of capital as well as sources of capital described above are insufficient to meet our needs, we may need to seek additional debt or equity financing.
Current wording
For at least the next twelve months, we expect our principal demand for funds will be for our ongoing operating activities described below and the repayment of $30.4 million of contractual principal payments related to the 2028 Notes. Beyond the next twelve months, our principal demand for funds will be to sustain our operations, operate our spaceline at Spaceport America in New Mexico, expand our fleet of spaceships, launch vehicles and supporting facilities, and repay outstanding debt.
Previous wording
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, we first compare undiscounted cash flows expected to be generated by that asset group to its carrying amount. The estimate of cash flows includes management's assumptions of cash inflows and outflows directly resulting from the use of those assets in operations. We assess impairment for asset groups, which represent a combination of assets that produce distinguishable cash flows. If the carrying amount of the asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value.
Current wording
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, we first compare undiscounted cash flows expected to be generated by that asset group to its carrying amount. The estimate of cash flows includes management’s assumptions of cash inflows and outflows directly resulting from the use of those assets in
Previous wording
We have granted stock-based awards consisting of restricted stock units ("RSUs"), performance-based stock units ("PSUs"), performance-based stock options ("PSOs"), and service-based stock options. Our outstanding RSUs and stock options contain a service-based vesting condition. The service-based vesting condition for the majority of these awards is satisfied over four years. Our outstanding PSUs contain a service-based vesting condition, as well as a market-based vesting condition that is satisfied based on the Company's common stock performance following the end of the three-year performance measurement period based on the highest closing price over twenty consecutive trading days during the performance measurement period. Our outstanding PSOs contain a market-based vesting condition that is satisfied based on the attainment of certain stock price goals.
Current wording
We have granted stock-based awards consisting of restricted stock units (“RSUs”), performance-based stock units (“PSUs”), performance-based stock options (“PSOs”), and service-based stock options. In addition, eligible employees are granted an option to purchase common stock under an employee stock purchase plan (“ESPP”). Our outstanding RSUs and stock options contain a service-based vesting condition. Our outstanding PSUs contain a service-based vesting condition, as well as a market-based vesting condition that is satisfied based on the Company’s common stock performance following the end of the performance measurement period based on the highest closing price over twenty consecutive trading days during the performance measurement period. Our outstanding PSOs contain a market-based vesting condition that is satisfied based on the attainment of certain stock price goals.
Previous wording
We have estimated the fair value for each service-based stock option award as of the date of grant using the Black-Scholes option pricing model. The Black-Scholes option pricing model considers, among other factors, the expected life of the award and the expected volatility of our stock price. We have estimated the fair value for each PSO and PSU award with market-based conditions as of the grant date using the Monte-Carlo simulation method. The Monte-Carlo simulation method considers, among other factors, the discount rate and future market conditions.
Current wording
We have estimated the fair value for each service-based stock option award and stock purchases under the ESPP as of the date of grant using the Black-Scholes option pricing model. The Black-Scholes option pricing model considers, among other factors, the expected life of the award and the expected volatility of our stock price. We have estimated the fair value for each PSO and PSU award with market-based conditions as of the grant date using the Monte-Carlo simulation method. The Monte-Carlo simulation method considers, among other factors, the discount rate and future market conditions.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
operations. We assess impairment for asset groups, which represent a combination of assets that produce distinguishable cash flows. If the carrying amount of the asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value.
Current report — wording carried from elsewhere
We have estimated the fair value of warrants as of the date of the issuance using the Black-Scholes option pricing model. The Black-Scholes option pricing model considers, among other factors, the exercise price, expected life of the warrants and the expected volatility of our stock price.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Spaceline operations expense for the years ended December 31, 2024 and 2023, following achievement of technological feasibility in July 2023, were primarily attributable to costs to maintain and operate our spaceflight system; non-capitalizable costs to build our new vehicles and manufacture items required to support the making of our vehicles; and costs to maintain and support our astronaut community.
Previous report — wording carried elsewhere
Net cash provided by financing activities was $475.4 million for the year ended December 31, 2023, and consisted primarily of net cash proceeds from the sale and issuance of common stock pursuant to our at-the-market offering programs of $478.9 million, partially offset by tax withholdings paid for net settled stock-based awards of $3.2 million.
Previous report — wording carried elsewhere
In June 2023, we entered into a distribution agency agreement with the Agents providing for the offer and sale of up to $400 million of shares of our common stock from time to time through the Agents, acting as sales agents, or directly to one or more of the Agents, acting as principal(s), through an "at-the-market offering" program (the "2023 ATM Program").