Shares in Virgin Orbit, the company behind Britain’s failed first space launch, fell by more than a quarter at the U.S. open, falling more than economists expected by 20%.
Shares fell more than 50 cents from $2.01 (£1.65) at the close on Monday night to $1.50 (£1.23) when US markets opened on Tuesday morning.
The much-anticipated mission, which planned to send nine satellites into orbit on the company’s LauncherOne rocket, failed on Monday night due to a Auxiliary engine failed to fire properly.
It marked a huge disappointment after the first space mission was launched from the Cornwall spaceport.
revisit space mission
The mission used a modified jumbo jet called Cosmic Girl to deploy the rocket.
The firm, majority-owned by Sir Richard Branson’s investment vehicle, said an “anomaly” was responsible for the problem and was investigating the cause.
This is Virgin Orbit’s first launch attempt outside of the United States.
Virgin Orbit’s 747-400 named Cosmic Girl
The two-stage rocket has encountered technical problems before, but it is understood to be limited to the main engine.
Virgin Orbit — which was spun off from Virgin Galactic — went public in 2021 through a so-called SPAC (special purpose acquisition company) merger.
It was valued at $3.7 billion before the IPO, but had fallen to $6.54 billion before Tuesday’s trading session.
The failed offering was seen as further spooking investors, with the stock falling a further 23% in premarket trading.
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Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, said of the reaction: “After Virgin’s troubles as a public company, there were high hopes that this move would be a brighter future for Virgin. The beginning of the. company, following the merger of the SPAC with Next Gen Acquisition in 2021.
“The company’s cash burn rate has been high and its revenue outlook has been significantly dampened.
“While space may be hailed as the new investment frontier, these ventures clearly come with significant risks.
“It’s a major setback for Virgin Orbit and Cornwall’s ambitions as a new launchpad for space adventures, but the problems may not be insurmountable.”