v3.26.1
Liquidity and Financial Condition
6 Months Ended
Jun. 30, 2026
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Liquidity and Financial Condition Liquidity and Financial Condition
The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern and will be able to realize its assets and satisfy its liabilities in the normal course of business.
The Company is currently in the pre-commercial service phase and accordingly has no spaceflight revenue. The Company has recently used significant cash for operating activities and capital expenditures primarily related to the development of its next-generation spaceships and expects to continue to incur significant operating expenses and capital expenditures to complete the production of these spaceships and place them into commercial operation.
In preparation of the condensed consolidated financial statements, management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for twelve months from the date the condensed consolidated financial statements are issued, in accordance with the requirements of the Financial Accounting Standards Board's Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements - Going Concern (“ASC 205-40”).
Factors, among others, that are included in management’s evaluation are:
cash, cash equivalents, and marketable securities on hand as of the date the condensed consolidated financial statements are issued;
all company costs that are forecasted to be incurred over the upcoming twelve months from the date the condensed consolidated financial statements are issued, including costs expected to be incurred in completing fabrication and testing of the next-generation spaceships and costs expected to be incurred in the ramp-up to, and commercial operation of, spaceflights; and
all contractual debt payments due within the next twelve months are assumed to be settled in cash.
Items that are planned or expected by management, but the execution of which may not be fully under management’s control, are not included in management’s evaluation in accordance with ASC 205-40. Factors, among others, excluded from management’s evaluation include:
Revenues: any revenues or cash receipts, from spaceflights or otherwise, planned during the upcoming twelve months.
Capital Market Transactions: any proceeds from capital market transactions, whether from debt issuance, equity issuance, or otherwise.
Debt Repayment Terms: any change of contractual debt repayment schedules or settlement methods.
Management’s evaluation, which excluded the items that are not within its control (i.e., Revenues, Capital Market Transactions, and Debt Repayment Terms), resulted in the determination that the Company may not have sufficient cash and marketable securities to maintain its planned operations for the next twelve months following the issuance date of the condensed consolidated financial statements and has concluded that there are conditions present in the aggregate that raise substantial doubt about the Company’s ability to continue as a going concern pursuant to ASC 205-40.
Management’s plans that are intended to mitigate the conditions or events that raise substantial doubt include implementing some or all of the following initiatives:
Commencing commercial service in February 2027.
Generating significant cash from the current backlog of future astronauts as their final payments become due in advance of their spaceflight.
Offering the sale of a limited number of early spaceflights at a premium to historical prices.
Increasing cash on hand through additional debt or equity financing, including use of the Company’s existing “at-the-market” equity offering program.
Partnering with third parties to fund and accelerate the pace of future space vehicle development.
Settling debt through the issuance of equity and/or extending maturities of certain debt payments that are due within the period.
The plans discussed above are subject to market conditions and, while management intends to apply its best efforts to the execution of these plans, they are not fully within the Company’s control and therefore cannot be deemed to be probable in accordance with ASC 205-40, and as a result, management has concluded that its plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern for twelve months after the date that the condensed consolidated financial statements are issued.
The accompanying condensed consolidated financial statements do not include any adjustments related to the carrying amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.