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The Virgin Orbit Failure: Space is Hard, Profits are Harder

By Doug Messier
Parabolic Arc
January 10, 2023
Filed under
LauncherOne ignites after being dropped from Cosmic Girl. (Credit: Virgin Orbit)

After months of buildup about the first orbital launch of satellites from UK soil, the first launch ever from Western Europe, the beginning of a new era in British spaceflight, Virgin Orbit’s Cosmic Girl Boeing 747 dropped the LauncherOne rocket over the Atlantic Ocean off the southern coast of Ireland. The booster’s Newton 3 first stage engine ignited and shut down, the second stage separated and its Newton 4 engine ignited. All appeared to be nominal.

The second stage engine shut down and entered a coast phase; two more burns would follow, then the nine satellites would be deployed. With the second stage out of communication with ground control, Virgin Orbit tweeted:

LauncherOne has once again successfully reached Earth orbit! 🚀 Our mission isn’t over yet, but our congratulations to the people of the UK! This is already the first-ever orbital mission from British soil – an enormous achievement by @spacegovuk and their partners in government!

Triumph! Celebrations! The company stock starts to rise on Nasdaq in after-hours trading. Then, about 25 minutes later, Richard Branson’s launch company tweeted:

We appear to have an anomaly that has prevented us from reaching orbit. We are evaluating the information.

Ooops. It wasn’t in orbit after all. The satellites wouldn’t be deployed. They had already burned up in the atmosphere.

It was amateur hour. A clear violation of the first rule of launch: never declare mission success until every payload is deployed exactly where it is supposed to go. That goes double for a publicly traded launch company whose stock can rise and fall with each flight. Virgin Orbit’s already low stock price quickly sunk to its lowest point ever.

Launches are often described as being binary: they either work, or they don’t. This is not strictly true. There’s a third category called partial failure. It’s typically when a booster gets a satellite to an orbit that is lower than planned. Large spacecraft often have enough on-board propellant to reach their intended orbits, albeit at a reduction of their useful lifetimes. Smaller satellites often lack that capability. In other words, they have thinner margins when things go awry.

That’s true for rockets as well. On Apollo 13, one of the Saturn V’s five second stage engines shut down about two minutes early. Controllers burned the other four engines and the third stage longer than planned, and Apollo 13 was able to safely make its way to the moon. (SpaceX’s Falcon 9 has a similar engine out capacity.) Apollo 13 was a textbook flight for three days until an oxygen tank in the service module exploded. The astronauts were able to use the lunar module as a lifeboat and returned safely to Earth.

LauncherOne in a stormy Mojave before being transported to Spaceport Cornwall in England. (Credit: Virgin Orbit)

Smaller rockets often operate on much thinner margins. Virgin Orbit’s launch system is a mixed bag. The first stage is a four-engine Boeing 747. The aircraft can fly safely if an engine shut down. It can even fly on only two engines under certain conditions. LauncherOne has a single engine on each stage. Although this cuts down on complexity, it also means they have to work pretty much as designed.

LauncherOne’s failure dropped the booster’s record to four successes and two failures. The first failure occurred on the maiden flight in June 2020 when a propellant line on the first stage ruptured. Current online speculation about the cause of the second failure centers on a helium leak in the second stage. Virgin Orbit has yet to make any announcement about the root cause of the failure.

Most observers shrugged off the first failure. Maiden launches often go awry, and the rocket was carrying a dummy payload. The point of a flight test is to discover what’s wrong with a vehicle. They discovered a flaw, corrected it, and then launched four times without incident.

This failure was a lot more serious. It was an operational mission. Nine satellites were lost. It was an extremely high profile launch. It was hyped for months. Confidence in the company among satellite operators and shareholders was damaged.

Unfortunately for Virgin Orbit, the failure came as the company is dealing with mounting losses and dwindling cash reserves. As the company said in its third quarter earnings report in November: (emphasis mine)

“We have not generated positive cash flows from operations or sufficient revenues to provide sufficient cash flows to enable us to finance our operations internally, and may not be able to raise sufficient capital to do so. As a result of the Company’s assessment of going concern considerations, management has determined that the liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern.

Virgin Orbit isn’t the only company having difficulty in finding profits launching small satellites. The most successful provider, Rocket Lab, has yet to turn a profit with its Electron booster. In fact, Peter Beck’s company is pouring money into the development of a much larger, fully reusable booster.

The failure on Monday raised questions about the more than £20 million (US $24.3 million) in taxpayers’ dollars the UK spent to bring Virgin Orbit to Cornwall. That amount included £7.35 million (US $8.9 million) paid directly to Virgin Orbit.

Whether the investment proves to be a good one depends on Virgin Orbit’s continued operation and whether future launches from Cornwall are successful. (The company is planning two flights a year from the spaceport.) Branson’s company is not the UK’s only iron in the fire. A pair of spaceports are under construction in Scotland with small launch providers scheduled to fly from them.

Everyone involved in Monday’s launch put a brave face on the failure.

“We are so incredibly proud of everything we have achieved with our partners and friends across the space industry here in the UK and in the US – we made it to space – a UK first,” said Spaceport Cornwall head Melissa Thorpe. “Unfortunately we learned that Virgin Orbit experienced an anomaly which means we didn’t achieve a successful mission. Today we inspired millions, and we will continue to look to inspire millions more. Not just with our ambition but also with our fortitude. Yes, space is hard, but we are only just getting started.”

Virgin Orbit CEO Dan Hart sounded a similar if somewhat off-key note.

“While we are very proud of the many things that we successfully achieved as part of this mission, we are mindful that we failed to provide our customers with the launch service they deserve. The first-time nature of this mission added layers of complexity that our team professionally managed through; however, in the end a technical failure appears to have prevented us from delivering the final orbit. We will work tirelessly to understand the nature of the failure, make corrective actions, and return to orbit as soon as we have completed a full investigation and mission assurance process.”

Prevented us from delivering the final orbit? The flight didn’t deliver any orbit. The result, in this case at least, was binary.

3 responses to “The Virgin Orbit Failure: Space is Hard, Profits are Harder”

  1. Hemingway says:

    Excellent articles on Virgin Orbit

  2. Stanistani says:

    I guess their first orbit was their final one.

  3. patb2009 says:

    It’s very painful to issue a going concern notice, and it creates all sorts of P&L issues.
    Depreciation needs to be advanced, so losses magnify. It’s going to be a challenge to arrange mezzanine finance to get to a stable business model

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