Virgin Orbit will not be operating for some time.
The private space company recently announced it is halting operations for a week to shore up its finances and find more funding.
The announcement follows its UK launch, which failed due to a dislodged fuel filter causing its LauncherOne rocket to experience an anomaly, preventing it from reaching space and completing its mission.
Virgin Orbit Operations Pause Details
Virgin Orbit mentioned in its announcement to employees on Mar. 15 that it is halting operations for the time being effective Mar. 16 look for a funding lifeline, per CNBC's sources. The company also added that it is furloughing its many employees and that it will provide an update to them regarding the company's plans and go-forward operations in the coming weeks.
According to Space News' source, the company is dealing with a cash flow issue which reflected on its shares; it dropped 33% in after-hours trading from its Mar. 15 close of $1.01 per share - a far cry from its debut price of nearly $10 a share in Dec. 2021.
The BBC's report went one step further regarding the company's share drop: it reports that Virgin Orbit's shares dropped 18.8% to 82 cents in extended trading, with it citing a Reuters report.
Although the pause on Virgin Orbit's operations would last for a week, it is unclear if its employees' furlough will end at the same time as the pause on operations.
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Regardless, Virgin's Orbit's financial challenges have been brewing since late 2022; its last quarterly earnings report in Nov. 2022 revealed that it had an operating loss of $50.5 million and $71 million of cash on hand at the end of the third quarter of 2022. It had yet to release updated financial results since Nov. 2022, nor had it announced a schedule for doing so.
To save itself, the company reportedly raised $60 million in four tranches from Virgin Investments Limited (VIL) since Nov. 2022 in the form of loans with 12% interest rates. Virgin Orbit secured these loans with its assets, giving VIL "first-priority security interest" to them, including its Cosmic Girl Boeing 747 aircraft, which it uses to launch its LauncherOne rocket.
Virgin orbit's Failed UK Launch
The lack of funding follows its failed UK launch in January, which was supposed to be the company's most celebrated milestone. Virgin Orbit's UK launch initially went smoothly, with its Cosmic Girl carrier plane lifting off from Spaceport Cornwall on schedule and without issue at 5:02 PM EST.
Just over an hour later, Cosmic Girl dropped its LauncherOne rocket while it was off the southwest coast of Ireland. The rocket's first stage did its job, allowing its two stages to separate around 3.5 minutes after the drop.
After which, LauncherOne's upper stage finished a nearly five-minute burn before going into a long coast. However, Chris Relf, Virgin Orbit's director of systems engineering and verification, suddenly said during the mission's webcast that the rocket suffered a technical anomaly preventing it from reaching orbit.
A recent investigation revealed that a fuel filter within the LauncherOne rocket's fuel feedline had been dislodged from its normal position and that the fuel pump downstream of the filter was operating at a degraded efficiency level, starving its LauncherOne's Newton 4 engine of fuel.
The dislodged fuel filter and the degraded efficiency level of the fuel pump caused the Newton 4 engine to operate at a significantly higher temperature than it was rated. As such, its components downstream and the vicinity of the then-abnormally hot engine eventually malfunctioned, causing the second stage thrust to terminate prematurely.
The failed launch costed Virgin Orbit one of its LauncherOne rockets and its payload of nine satellites.
Related Article: Virgin Orbit Launcher One Investigation Finally Finds Cause of Failure
