Virgin Galactic (SPCE) Q3 2026 Earnings Call Transcript

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DATE

Thursday, Nov. 12, 2026

CALL PARTICIPANTS

• Vice President, Finance - Ken Michaels
• Chief Executive Officer - Michael Colglazier
• Chief Financial Officer - Doug Ahrens

TAKEAWAYS

• Revenue -- $427,000, representing growth from $365,000 in the third quarter of 2025 and primarily driven by astronaut access fees.
• Net Loss -- $58.8 million, representing a reduction from $64.4 million in the prior-year period due to lower overall operating expenses.
• Adjusted EBITDA -- $(46.8) million, compared to $(52.8) million in the third quarter of 2025.
• Cash Position -- $184 million in cash, cash equivalents, and marketable securities as of Sept. 30, 2026.
• Free Cash Flow -- $(99.1) million, reflecting an improvement compared to $(107.8) million in the third quarter of 2025.
• Q4 2026 Revenue Guidance -- approximately $100,000, as the company continues to focus on precommercial flight testing.
• Q4 2026 Cash Flow Guidance -- negative $80 million to negative $90 million in free cash flow.
• At-the-Market Offering -- $250 million, providing capital to fund operations through the ramp of commercial service and achieve positive free cash flow.
• Debt Reduction -- approximately $85 million of offering proceeds allocated to retire first lien debt as required by current lien holder agreements.
• Convertible Notes Exchange -- $12 million of debt due in February 2027 planned for retirement using stock, reducing the remaining balance to approximately $5 million.
• Total Debt Target -- less than $100 million in total outstanding debt expected following anticipated early payments and exchanges.
• Commercial Service Timeline -- early second quarter of 2027 for the first Delta class spaceship, Apeiron, following software-hardware integration testing delays.
• Second Spaceship Timeline -- late second quarter or early third quarter of 2027 for the start of commercial spaceflights.
• Flight Test Milestone -- January 2027 expected for the first glide flight of Apeiron at Spaceport America.
• Flight Capacity Guidance -- 150 spaceflights per year from the initial two-ship fleet, representing a 20% increase over previous baseline projections.
• Growth Initiative Investment -- $65 million to $70 million, covering the development of a high-cadence launch hangar and expanded rocket motor production.
• Economic Impact of Hangar -- $90 million in incremental annual revenue and $75 million in contribution margin once operational in the second half of 2028.
• Positive Cash Flow Target -- no later than the first quarter of 2028, driven by higher flight cadence and increased booking prices.
• Booking Price -- $850,000 per seat for the current limited tranche of spaceflight expeditions, up from previous tranches.
• Research Flight Pricing -- $750,000 to $800,000 per seat equivalent for scientific and government research missions.
• Aeronautical Hardware Status -- 95% of carbon composite parts received for the wing and fuselage of the second commercial spaceship.

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RISKS

• Michael Colglazier stated, "The software-hardware integration testing that we're doing has thrown kind of more test cases that need fixing than the team had allotted themselves time for," which resulted in a two-month delay to the commercial launch schedule.

SUMMARY

Virgin Galactic Holdings, Inc. (NYSE:SPCE) reported the relocation of its lead Delta class spaceship to Spaceport America, shifting company focus from manufacturing to spaceline operations ahead of 2027 commercial service. Management reported that the company is executing a $250 million capital program to strengthen the balance sheet, fund operations through the commercial ramp-up, and retire approximately two-thirds of its outstanding debt. The company stated that strategic investments in a new high-cadence launch hangar and fueling infrastructure will structurally eliminate weather-related delays, increasing the annual flight capacity of the initial two-ship fleet. Positive free cash flow is forecasted to begin in early 2028 as the company moves through its reservation backlog and realizes higher ticket prices from new bookings.

• CEO Colglazier stated, "The new spaceship is magnificent, and we're thrilled to have Apeiron relocated to its permanent home."
• Management expects a flight cadence of two flights per week per spaceship, providing theoretical capacity for approximately 200 spaceflights per year before adjustments for weather and maintenance.
• The company is exploring government and defense applications for its hybrid rocket systems, focusing on the testing market for missile defense and high-speed maneuvers.
• CFO Ahrens indicated that the capital plan will bring total outstanding debt below $100 million, significantly reducing interest expenses over the next two years.
• Management reported that the expected payback period for the new high-cadence launch hangar is less than one year due to the high contribution margins of additional spaceflights.
• Over 100 astronauts have advanced into the first phase of readiness preparation, marking the start of the final countdown process for their specific spaceflights.

INDUSTRY GLOSSARY

• Apeiron: The name given to the first spaceship in Virgin Galactic's Delta class fleet.
• Delta Class: A new generation of spaceships designed for rapid maintainability and high-cadence flight operations.
• Eve: The company's custom-built launch aircraft, also known as the mother ship, which carries the spaceship to high altitude.
• Spaceport America: The world's first purpose-built commercial spaceport, located in New Mexico and serving as the company's operational base.
• DAU: Digital acquisition units, sensors on the ship that aggregate data and transmit it to pilot displays and mission control.

Full Conference Call Transcript

Operator: Good afternoon. My name is Desiree, and I will be your conference operator today. At this time, I would like to welcome everyone to Virgin Galactic's Third Quarter 2026 Earnings Conference Call. [Operator Instructions] I will now turn the call over to Ken Michaels, Vice President, Finance. Please go ahead.

Ken Michaels: Thank you. Good afternoon, everyone. Welcome to Virgin Galactic's Third Quarter 2026 Earnings Conference Call. On the call with me today are Michael Colglazier, Chief Executive Officer; and Doug Ahrens, Chief Financial Officer. Following our prepared remarks, we will open the call for questions. Our press release and slide presentation that will accompany today's remarks are available on our Investor Relations website. Please refer to Slide 2 of the presentation for our safe harbor disclaimer. During today's call, we may make certain forward-looking statements. These statements are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual events to differ materially from the forward-looking statements made on this call.

For more information about these risks and uncertainties, please refer to the risk factors in the company's SEC filings made from time to time. You are cautioned not to put undue reliance on forward-looking statements, and the company specifically disclaims any obligation to update the forward-looking statements that may be discussed during this call, whether as a result of new information, future events or otherwise. Please also note that we will refer to certain non-GAAP financial information on today's call. Please refer to our earnings release for a reconciliation of these non-GAAP financial metrics. Please turn to Page 3 in the slide presentation as I turn the call over to our Chief Executive Officer, Michael Colglazier.

Michael Colglazier: Hello, everyone, and thank you for joining the call today. We delivered the lead spaceship of our Delta class fleet, Apeiron, Spaceport America in late October, and this milestone marked an exciting handoff from our manufacturing organization to our spaceline operations team. The new spaceship is magnificent, and we're thrilled to have Apeiron relocated to its permanent home. I'll start today's call by describing what's next for Apeiron on the way to launching commercial spaceflights in early Q2 2027 as well as an update on the build of our second spaceship, which is expected to begin commercial spaceflight in late Q2 or early Q3 2027.

I'll share details of new growth initiatives, which we expect to drive substantial revenue and profit growth, including a specific investment targeted to increase spaceflight capacity to 150 spaceflights per year from our initial 2 spaceships. I'll share some of the excitement we are hearing from our astronaut community as we have advanced over 100 individuals into the readiness phase of their upcoming spaceflights. After that, I'll turn the call over to Doug for a financial review, which will include a discussion on our planned use of a new $250 million at-the-market equity offering program, which was announced earlier today. Turning to Page 4.

Apeiron, the Greek word for boundless, is an auspicious name for the lead spaceship of our Delta class fleet. It reflects the spirit of our astronauts and it inspires the ambitions of our company. Apeiron is pictured here arriving at Spaceport America in New Mexico. It is now being prepared for its flight test program with the heaviest activity being the completion of software-hardware integration testing. As previously announced, we required additional time to complete this effort. We've extended our schedule and bolstered resources to allow the teams to complete the effort, and I'm pleased with the thoroughness of the work and the pace of progress the teams are achieving.

This added time has pushed back the start of flight test, which will commence with a captive carry flight above Spaceport America, where we will conduct in-flight functional checks of the spaceship systems while staying native to the launch aircraft flying at high altitude and cold temperatures. This will be followed by Apeiron's first glide flight, which is expected in January. As previously announced, Apeiron's first spaceflight is expected in early Q2 2027. Moving to Page 5. I want to share highlights of the progress with the build of our second commercial spaceship. The images on this page show major parts of the wing, fuselage and feather subassemblies for our second spaceship coming together.

Our partners at Bell have been making excellent progress on the feather assembly, and we have already received over 95% of the carbon composite parts for the wing and fuselage from Qarbon Aerospace. We expect the last 2 major parts for the wing and fuselage to arrive in early December. This is great news. Our manufacturing team has already applied learnings from the build of our first spaceship to the build of our structural test articles to improve efficiency. These learnings are being applied to the second spaceship that is now moving to the factory.

We expect this second spaceship will enter commercial service alongside Apeiron in late Q2 or early Q3 2027, at which point we will begin to ramp our flight cadence towards 125 spaceflights per year. On that note, I'd like to move to Page 6 to discuss some of our underlying assumptions around flight cadence and capacity from our initial 2 spaceships. As we shared in the past, Apeiron and the Delta class spaceships that will follow have been designed for maintainability with a targeted flight cadence of 2 flights per week per spaceship. With a 2-ship initial fleet, this provides theoretical capacity for approximately 200 spaceflights per year.

Our launch aircraft, Eve, has gone through multiple enhancement programs to prepare for this flight cadence, and our teams are targeting Eve spaceflight launch capacity at approximately 175 flights per year. Thus, our theoretical baseline capacity with 2 spaceships and Eve is approximately 175 flights per year. We expect 3 factors will reduce this theoretical capacity to a lower actual spaceflight rate. The first 2 factors are flight day weather and unplanned maintenance activity. While weather in Southern New Mexico is generally excellent for spaceflights, we do expect some flight days to be scrubbed for rain or very high crosswind conditions.

Although we can often recover intermittent scrub flights over the following week, we expect an efficiency reduction of approximately 25 flights per year from the combination of flight day weather and unplanned maintenance. The third factor impacting flight capacity is exposure to overnight weather conditions. We have traditionally conducted our fueling operations outdoors, which exposes our operation to overnight squalls that can also cause flights to be canceled. We have estimated an efficiency loss of approximately 25 flights per year from exposure to these overnight weather conditions. In combination, these 3 factors are expected to reduce our 2-spaceship operational capacity to 125 flights per year, which is the annualized rate we have been projecting for some time.

I am pleased to share our teams have identified a way to structurally eliminate the overnight weather impacts and increase our operational capacity by 20% from 125 to 150 spaceflights per year. Moving to Page 7. We've included a rendering of the high-cadence launch hangar and fueling infrastructure, which will move fueling and pre-flight operations indoors and eliminate cancellations caused by overnight weather. When complete, we expect this growth investment to deliver 20% more annual spaceflights from our initial 2 spaceships. Because our cost base is largely fixed, a substantial portion of this revenue should flow through to the bottom line. On to Page 8. This image shows our rocket production line coming together as planned.

This line will produce rocket motors for our spaceflights in New Mexico and has expansion capacity to support additional spaceports. As many of you are aware, there is currently high demand for rocket systems within the government and defense sectors. We believe our expertise in rocket design and production can be adapted to support these needs, and we plan to expand our rocket production capabilities with targeted growth investments as we pursue these opportunities. Before I hand the call over to Doug, I'd like to share a bit about the mobilization of our astronaut community and an update on the reopening of bookings for spaceflight expeditions. Please turn to Page 9.

As previously announced, we've advanced over 100 astronauts into the first phase of readiness preparation ahead of their spaceflight. And the image on this page shows the change in their astronaut portal that designates the countdown process has begun. As you can imagine, it has been a joy to make these calls and our astronauts have been overjoyed to receive them. As we ready the initial astronauts for their journey, we have once again opened a limited number of bookings for Virgin Galactic spaceflight expeditions. One of the most powerful drivers of our business is the love people have for this experience and the possibilities it embodies.

When we reopened bookings at the end of Q3, we built on the success of our $750,000 tranche by opening an additional limited tranche at $850,000 per expedition. We continue to see meaningful demand at this price point. And like the last time, I expect the price of a spaceflight expedition will increase following the close of this current tranche. Our astronaut expeditions team is building a bookings model that can expand without compromising exclusive pricing. At its heart are referrals, which reflect the deep enthusiasm people have for our experience, and these referrals will be further supported with curated events, hosted experiences and brand partnerships.

I'll now hand the call over to Doug for a financial update and insight into how we plan to deploy our capital.

Douglas Ahrens: Thanks, Michael, and good afternoon, everyone. After market closed today, we announced the $250 million at-the-market equity offering program, and we believe this is the total remaining amount of capital needed across 3 primary areas: to fund operations through the ramp of commercial service and achieve positive free cash flow, to invest in targeted growth initiatives that are expected to yield high returns, and to retire debt to improve our capital structure. Now I'll spend a moment on each of these 3 areas. Turning to Slide 10. First, as we announced previously, we've moved the expected start of commercial spaceflights to early Q2 2027 to complete additional work on software-hardware integration testing.

This date is approximately 2 months later than we planned. Therefore, a portion of this program will replenish cash and expected to carry us through the ramp of commercial spaceflight operations. Additionally, this capital will also strengthen the balance sheet until we achieve positive free cash flow. Second, we want to invest in 2 specific growth opportunities. Turning to Slide 11. Michael covered the operational benefits of a high-cadence launch hangar, and I'll focus on the economic impact of this investment. On this slide, we have illustrated how the increase in flight rate from 125 to 150 flights per year provides $90 million of additional revenue and $75 million of contribution margin from our initial fleet of 2 spaceships.

Because we can achieve this increase in flights with the same fleet, the high contribution margin from these spaceflights should substantially flow through to the bottom line. You can see the economies of scale we plan to achieve with this high-cadence launch hangar as we expect greater than 50% growth in adjusted EBITDA from our initial fleet when it becomes operational. The expected payback period for the hangar is less than 1 year. By allocating growth capital to this project in the near term, we expect to have the high-cadence launch hangar operational in the second half of 2028. The second growth investment is in rocket production capabilities that Michael discussed.

With a modest capital investment, we could increase our rocket production capabilities to pursue additional opportunities with the government and defense industry. Third, a portion of the proceeds from the ATM program will be used to pay down our future debt obligations. By allocating approximately 1/3 of the ATM proceeds to debt retirement as required by our lien holder agreement, we will improve our capital structure and reduce the interest expense on our first lien debt. Following a successful completion of these anticipated early payments, the outstanding balance of our first lien debt is expected to be reduced to approximately $92 million, which will not be due until December 31, 2028.

Separately, today, we also announced an anticipated exchange of a significant portion of our 2027 convertible notes, which is planned for next week. We expect to retire more than $12 million of debt due in February 2027 by using stock rather than cash. Following this exchange, we expect the outstanding balance of our convertible notes to be reduced to around $5 million. Together, these actions bring our total outstanding debt below $100 million, significantly reduce our interest expense and leave us with minimal principal payments due over the next 2 years as we scale spaceflight operations. Turning to Slide 12. I'll briefly cover our financial projections. Revenue for the fourth quarter of 2026 is expected to be approximately $100,000.

Free cash flow for the fourth quarter is expected to range from negative $80 million to negative $90 million. Looking at the 2027 income statement, we expect revenue to commence early in the second quarter, and we forecast expenses in spaceline operations to increase as commercial spaceflights ramp up. We forecast positive free cash flow no later than the first quarter of 2028. In closing, we believe these actions position us to enter commercial spaceflight operations with a stronger balance sheet and pursue near-term growth opportunities with our initial 2 spaceships. Our revenue growth will be driven by 2 key factors: the number of flights we complete and the average price paid for the astronaut spaceflight expeditions.

We expect meaningful revenue to begin when our first spaceship enters commercial service in early Q2 2027, followed by additional growth as our second spaceship enters service in late Q2 or early Q3 2027. Then as we work through earlier reservations that were historically sold at lower price points, we also expect revenue to rise as higher-priced spaceflight expeditions are flown. In 2028, we expect these drivers to reinforce one another. Higher-priced bookings are expected to make up more of our flights, while the planned high-cadence flight hangar would increase annual flight capacity. More flights at higher average expedition prices would generate additional revenue and contribution margin, further magnifying our profit-generating potential.

With that, I'll turn the call back over to Michael.

Michael Colglazier: Thanks, Doug. Turning to Page 13. Apeiron's arrival at Spaceport America has shifted the company's focus to operations as we now prepare for flight test and ready ourselves to host astronauts and their friends and family as we commence commercial spaceflight. Doug outlined our capital plans. We are being purposeful and efficient with our use of funds to achieve positive free cash flow, expand our profitability and manage our debt in a balanced fashion. Our next step is to bring Apeiron into the skies for its flight test program as we continue to build our second spaceship, expand our bookings and prepare to welcome our astronauts to space in 2027. Let's open the call for questions.

Operator: [Operator Instructions] Our first question comes from the line of Tom Fitzgerald with TD Cowen.

Thomas Fitzgerald: Just wanted to think about in terms of the schedule picking up to the right a little bit. Do you see any risk between -- just given everything you know now of a potential further slippage in 2027? And any buffer built into that schedule?

Michael Colglazier: Thanks, Tom. This is Michael. The push on our schedule almost entirely is as we're working through what our teams would call software-hardware integration. And the software is done, the hardware is done. As you put those 2 together, we have a quite exhaustive testing process to ensure those things come together and they're all working as expected. We missed our expectations, I'll call it the project management standpoint, as to how long is it going to take us to work through that effort. And so you saw us push back.

And when you see a range of early Q2 versus a specific date, that builds in a degree of contingency on top of what we expect the team will actually deliver. Just to give a little bit of color as to what's going on, the ship, as I said, it's magnificent, it's beautiful. It's out of Spaceport America now. The software-hardware integration testing that we're doing has thrown kind of more test cases that need fixing than the team had allotted themselves time for. And we need to give them that time. So just to give a couple of examples, Tom, here for you and for everyone. Some of these things are quite small and simple.

They are mostly about making sure data signals are moving to the right places in our display. So as an example, we have sensors all around the ship. They aggregate in what we call digital -- our data acquisition units, DAUs. And we send, for discussion sake, like 30 channels of information back up to the pilot displays. One of those is what's the position of our brakes. A completely different one is what's the position of our feather systems. And as we put the software-hardware together, we realized those channels were swapped. And so they needed to be reprogrammed to display in the right positions on the pilot display. So that is a reasonably clear. It's understandable.

It's a straightforward software piece. I'll give another one, I'll call it important, but straightforward in what to do. As we've shared in the past, we have great redundancy built throughout our systems. And we don't just put the redundancy in, we test edge cases to ensure that the redundancy, if ever called upon, would work as planned. So we use these edge cases in both our simulations and in actual efforts. So I'll give you one example here. We have actuators that when the pilots are moving the control sticks, they move the flight control services that are being pushed by actuators.

So there are little computers, we call them controllers, that control the pace at which those actuators are moving. And we have redundant actuator controllers, right? It's one of the foll-over places. So if there's ever a need to not use the primary actuator controller and roll over to as backup in the software is a reset time that we established in milliseconds, and that's the software piece. But when we actually got to test that on the ship, where you're actually moving it and rolling over from one controller to the next, the timing that the hardware really needed was a little different in milliseconds. So okay, now that we've learned that, we need to redo the software.

And then just to give a sense of why this has taken us time, while we're redoing the software, we also then write a very thorough test script that we will put that software through. When the test script's done, we then do a lot of checking on the test script. So that's done. The software is done. We then test it again and we run regression testing to make sure that our changes didn't create any other changes. And all that takes time. And then when we get it done, like we did with this case, great, done. That one is settled and we move on to the next piece.

But that process I described for the important things is the exact same process we follow for all the little things like I talked at the beginning. And so that's where a manageable number of these things is still taking the time that we gave ourselves when we moved our schedule back. So hopefully, that gives you a bit of sense of color. And as you asked at the front, we have allowed ourselves additional time in our projected date beyond what our software and hardware teams are targeting.

Thomas Fitzgerald: Okay. Great. That's really helpful. And if I could sneak in a quick follow-up. How should investors think about the right blended rate for -- as you work through this backlog of earlier book reservations and then kind of get to the 2028 and beyond? Just kind of curious and just on the current time line, what the cadence could look like as you move through '27 and into early '28 and how that blended rate kind of shifts over time.

Michael Colglazier: Sure. I'll get a start, and Doug, feel free to come in and end with it. So the pricing has stepped up from its origination at $200,000 for spaceflight expedition to $250,000, to $450,000, to $600,000, to now then $750,000 and now $850,000. And by and large, we plan to move through that in a sequential nature. As I said in the past, there are going to be a limited number of spaceflight expeditions where the person on that will end up being part of the first 1,000 people to space. And we've shared in the past, we have a very limited number of those that we've put out at a substantially higher price point.

And we will blend some of those in by default because they'll need to be part of the first 1,000 people of space. You'll also see us blending in some research flights that are priced usually up $750,000, $800,000 or so for a seat equivalent on the research that we do. So you'll see us mix. But as I said, we will work to follow sequential order as best we can. So as you heard Doug mention, we'll start our blended rate lower and then ramp that up. So by the time we're at '28 and especially as that launch hangar comes in, you'll start seeing things in the $600,000 to $800,000 range.

Obviously, that makes a big difference in flow-through. Doug, anything you'd like to add to that?

Douglas Ahrens: No. You covered it all. That was accurate.

Michael Colglazier: Tom, you still there?

Operator: We will now proceed. Our next question comes from the line of Michael Leshock with KeyBanc Capital Markets.

Michael Leshock: I wanted to just ask on the cash burn. As we look to 1Q '27, is there any reason that there would be a meaningful improvement? Or are you expecting the cash burn to be more gradual ahead of the first flight? I'm just trying to see if there's any reason to expect any big step change in cash flow as you're working through the milestones to get to commercial service. Or does that not really change meaningfully until you're flying?

Douglas Ahrens: Thanks, Mike. This is Doug. Yes, so we gave guidance for the fourth quarter to be in the range of negative $80 million to $90 million in free cash flow. Just leaning forward a little more, Q1 of 2027 is probably going to be in the same ballpark because there's not a real structural change during that time as we're gearing up for our first spaceflight. And then in Q2, you start to see some pickup because now we have inflows coming from customers in a more meaningful way. So that's where you start to see it turn up. But no increase in need or additional spending at a quarterly rate between now and the start of commercial service.

Michael Colglazier: And Doug, just sharing this. I know this, but just for clarity, that will be a ramp down in kind of the SpaceWorks team that are building the ship and a ramp-up in the spaceflight teams that are operating the ship. And those things are just going to kind of cross each other on the way down and up and keep that in balance.

Douglas Ahrens: Yes, that's correct. So as we're winding down the work in Mesa that you're seeing as the spaceships come out, at the same time we are seeing an increase in staffing and readiness for the start of commercial flight in those...

Michael Colglazier: In a good way.

Douglas Ahrens: Those offset, yes. So it's supposed to be.

Michael Leshock: Okay. Got it. That's really helpful. And then could you break out the expected capital that you need for the new high-cadence launch hangar and the fueling infrastructure? Just I see that was one of the primary use of proceeds called out in the ATM and then you have the minimum $85 million or so to pay down the '28 debt. So I'm just curious what is remaining to allocate for the new hangar after general corporate and operational costs. Any color you could provide there would be great.

Michael Colglazier: Okay. Yes. So you got the debt buydown one, and you got that right, it's about $85 million towards that first lien debt. So the next bucket is really the operating costs while we're getting to the start of commercial service and as we start to ramp. And so let's say -- let's just put it in perspective, we moved the schedule about 2 months. So we put a little more buffer on top of that, and we're putting about a quarter's worth of additional cash on the balance sheet to strengthen it. So call that 100-ish. And then you get to the third bucket, which is now the growth investments.

And so we're seeing this as the right opportunity now that we're getting closer with the spaceships coming out and getting ready for commercial service. We want to make the most of that. So we're going to put around $65 million, $70 million into these growth initiatives with the larger portion of that amount being the high-cadence launch hangar and a portion going to rocket motors as we've talked about. So it's within that bucket of $65 million to $70 million.

Operator: Our next question comes from the line of Kristine Liwag with Morgan Stanley.

Gabrielle Knafelman: This is Gaby Knafelman on for Kristine. I was just wondering if you could elaborate on the government and defense applications that you're targeting with your rocket production capabilities. What do those customer conversations look like today? And would they use your existing technology or require additional development and qualification?

Michael Colglazier: Gaby, it's Michael. I won't go too far today because I think these things are better, right, when something is actually clear than speculation. But our hybrid system has a benefit as you can adapt pressure through it. It's not the exact same as a throttle, but has a throttling mechanism to it. So you can change the speed with that. And I think the place we will look first is how we might adapt our rocket capabilities using some of that speed change and other capabilities to the testing market, right?

There's a lot of testing going on in missile defense in particular, and the ability to create things that can be used in that test process is growing and in need. So I think we'll start there as a -- almost a very direct lift from what we do. But our teams are quite skilled and there is a large market. So we're going to put some business development effort in there. And part of the growth capital that Doug was describing will expand some of our capabilities and use them to improve our own processes, but also give us some capabilities to do things we haven't done just for our own book of business.

Operator: There are no further questions at this time. Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

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