Shares of Virgin Galactic (SPCE) are up in after-hours trading after the aerospace company reported earnings for its second quarter of Fiscal Year 2025. Earnings per share came in at -$1.47, which beat analysts’ consensus estimate of -$2.34 per share. However, sales fell year-over-year from $4.2 million to $400,000, missing estimates of $450,000.
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Virgin Galactic’s Outlook
Looking forward, management expects Q3 2025 free cash flow to land between -$100 million and -$110 million. Although SPCE expects to continue burning cash, CEO Michael Colglazier said that the company’s first spaceflight using its new Delta SpaceShips is scheduled for fall 2026, with a payload of scientific research. The company also plans to launch private astronaut spaceflights shortly after.
However, it is easy to wonder if SPCE can scale quickly enough to actually achieve this goal and if there is even enough long-term demand to keep the business alive. In addition, bears are likely concerned about the company’s low revenue levels relative to the amount of cash it is burning. Usually, investors are willing to overlook losses if a business’ revenue is growing extremely fast on both a percentage and absolute basis. However, both requirements aren’t being satisfied at SPCE, as revenue came in below $1 million.
Is SPCE Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate consensus rating on SPCE stock based on two Buys and two Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average SPCE price target of $4.69 per share implies 23.9% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
