Virgin Galactic Holdings, Inc.

Good afternoon. My name is Bailey, and I will be your conference operator today. At this time, I would like to welcome everyone to Virgin Galactic's third quarter 2022 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw this question, please press star followed by two. Thank you. I would now like to turn the call over to Eric Cerny, Vice President of Investor Relations.

Thank you. Good afternoon, everyone. Welcome to Virgin Galactic's third quarter 2022 earnings conference call. On the call with me today are Michael Colglazier, Chief Executive Officer, and Doug Ahrens, Chief Financial Officer. Following prepared remarks from Michael and Doug, 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 see slide two 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 filings with the SEC filed by Virgin Galactic from time to time. Readers 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. Please also note that we will refer to certain non-GAAP financial information on today's call. With that, I would like to now turn the call over to Michael.

Good afternoon, everyone. We had a very productive third quarter, making significant progress on our immediate objective of returning to flight and launching commercial service in the second quarter of 2023. We also continued to execute on our long-term business objectives to scale our future fleet. Turning to slide three and today's agenda. We'll start with our commercial readiness efforts, including an update on the enhancement program of our initial ships, followed by progress on our future fleet development. Finally, I'll hand the call over to Doug, who will provide a financial review of the quarter. So let's turn to slide four and a discussion around commercial readiness. As we approach commercial service, we recognize the significance of getting back to the business of space flight and providing our existing customer base with an unforgettable experience. During the quarter, we made great progress on our enhancement program for our initial ships. Work on VSS Unity is complete, and the ship is ready to commence test flights. We are tracking to have work on VMS Eve completed in the fourth quarter. As a reminder, the modifications we have made are designed to significantly improve the durability and reliability of both ships, enabling a higher frequency flight rate for commercial service. As you can see in the photo from Spaceport America on slide five, one of the final steps in Unity's enhancement program was the design and application of the ship's new livery. With the installation of Unity's enhancements now complete, we anticipate reduced maintenance needs for the spaceship and the ability to support a monthly flight case. On Eve, the new launch pylon has been completed, new horizontal stabilizers have been installed, and upgrades to avionics and mechanical systems are wrapping up. We are now in the process of completing final flight preparation tasks. Subject to successful completion of these tasks, we expect the first test flight for Eve to occur in early January, if not before, with the ship returning to its home base in New Mexico shortly thereafter. After the verification test flights of Eve, we will move to a glide flight of VSS Unity and then to a space flight with Virgin Galactic mission specialist on board. The crew will assess various elements of the astronaut experience and make final requirements to our training program for our first commercial passengers. As always, our approach to test flights is methodical and iterative. And following the sequence of test flights, commercial service is expected to commence with the Italian Air Force research mission followed by private astronaut space flights. In the coming weeks, We will begin communicating with our founder astronauts regarding their flight assignments for their life-changing trip to space. I've spoken in the past about the value of our unique customer journey, both as a key product differentiator and as a customer retention and lead generation engine. Key to that is our membership community of future astronauts and the exclusive events and programming that it offers. In late September, we held the inaugural Space for the Curious Summit in Wyoming. This is our marquee membership event for future astronauts. The images on slide six provide a glimpse of the dynamic programming designed to enrich our customers' anticipation and readiness for their space journey. Many of our future astronauts brought friends and family members who were able to interact with our team and other members of the community. We continually hear feedback that this community access and interaction is a key differentiator for Virgin Galactic. and it is something foremost in our customers' minds when they decide to fly with us. Our future astronauts are incredibly excited for us to bring them to space, which is why the launch of commercial service in Q2 of 23 is so important. Also critical to our success is the ability to grow our fleet. So let's turn to slide seven in our future fleet development. As we shared with you before, our production model spaceships, the Delta class, are intended to materially increase our flight frequency. These ships will be the key driver of revenue growth and profitability for the company. We are leveraging the existing aerospace ecosystem to enable greater speed to market than with a fully vertical operation. Last quarter, we announced our agreement with Boeing's subsidiary, Aurora Flight Sciences, to build our next-generation motherships, and we shared that we had issued requests for proposals for major sub-assemblies of our Delta-class spaceships. As announced yesterday, we have selected two very experienced companies in aviation and aerospace, Bell Textron and Carbon Aerospace, as our primary suppliers for the Delta ships. As illustrated on slide eight, Bell Textron will supply our unique feathering system and flight control surfaces. Among many strong attributes, Bell Textron's expertise in tilt rotor technology is complementary to the feather technology used on our spaceships. Carbon Aerospace known for its expertise in constructing large, complex composite parts for aerospace and aviation, will produce the fuselage and wing of our spaceships. Along with Aurora, these important relationships propel our production strategy, and we're excited to be joining forces with aerospace companies of this caliber. Work will begin immediately with Bell and Carbon, and initial production, including tooling efforts, is targeted to begin in 2023. The Virgin Galactic team will retain responsibility for the overall system architecture and design authority for all components. Final assembly and integration of the new ships will be done in our facility in Phoenix, Arizona. Flight test and acceptance testing of the new ships will take place at Spaceport America in New Mexico. Regarding our next-generation motherships, our collaboration with Aurora Flight Sciences is also progressing well. We will soon be moving into the tooling phase, and the Next Generation Mothership Program remains on track to begin flight testing ahead of the first Delta ship coming off the line in Phoenix in 2025. With this schedule in mind, we are dedicating significant engineering resources to the work that precedes production of the future fleet. Simultaneously, we are focused on the launch and flight consistency of Unity and EVE to begin bringing our customers to space and to demonstrate the value of our product. Prioritizing our resources against these important efforts will likely impact the pace of work on our second spaceship, BSS Imagine, and we are reassessing its schedule for entering commercial service. I'll now turn the call over to Doug for an update on our financials.