Virgin Galactic Holdings, Inc.

telephone keypad if you would like to withdraw your question press the pound key everyone welcome to virgin galactics fourth quarter, and full year 2020 offer questions.

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 SEC filings made from time to time. Your caution 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 today, 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 those non-GAAP financial metrics. Turning to our agenda for today's call on page three, Michael will open the call with a recap of 2024, followed by an in-depth update on the progress of our spaceship program. Mike Moses will join the call, followed by Doug Ahrens, who will provide a financial overview before we turn the call over to Q&A. With that, I would now like to turn the call over to Michael. Michael, go ahead.

Thanks, Eric. 2024 marked an inflection point for Virgin Galactic. We opened the year with our prototype spaceship, demonstrating the amazing customer experience delivered by Virgin Galactic Spaceflights. And we closed 2024 by wrapping up the multi-year design phase of our groundbreaking new spaceships. 2025 will be a year of momentum, as we are now building the spaceships that will dramatically expand human spaceflight with unprecedented levels of safety, rapid reusability, and cost efficiency. Fabrication of tools and parts for these ships is well underway, as you'll see in a moment, and our teams are excited to kick off assembly of our first spaceship next month at our spaceship factory in Phoenix. The production and launch timeline for the new ships remains on track, with our first commercial research spaceflight expected in the summer of 2026 and the first private astronaut spaceflight in the fall of 2026. We are able to be more specific with projecting our timelines because we now have line of sight to the delivery dates of each and every tool and part that supports assembly. With this work accelerating, we will spend time on today's call showcasing the advances already made as well as the milestones that will mark our progress going forward. One of the things that I am most excited about has been the transition of Virgin Galactic from an R&D focused company to a company that builds real assets that drive real value. I would like to highlight five of these key assets that differentiate our company. Turning to slide four. First is our new spaceship. These ships will have longer life, faster turnaround times, and lower cost per flight than any human-rated spaceship in the world. They are designed to fly twice a week with a lifespan of over 500 space flights. This is a breakthrough design and a huge step forward in commercial space. Second is our spaceship factory. We've made the needed non-recurring infrastructure investments, and we are now able to add ships to our fleet quickly and cost-effectively with a start-to-finish cycle time of new spaceships measured in months versus years. Third, our rocket system. We have created the world's most powerful hybrid rocket system, which is proudly on display in the Smithsonian. Our rocket system has outstanding safety features that are part of its elegant and reliable design, and the quick change capability of our rocket motor supports the fastest refueling and turnaround time of any single space vehicle that is capable of human spaceflight. Fourth, our customer and client experience, which is beyond compare. We have curated, honed, and demonstrated our industry-leading customer experience, delivering human-first spaceflight for private astronauts and unparalleled microgravity environments for space research and space scientists. Our fifth and enormously valuable asset is our carrier ship platform, internally known as our mothership, which rarely gets the attention it deserves. So let's give our carrier ships some airtime as we turn to slide five. The first of our carrier ships, named Eve, has supported every test flight and commercial space flight for Virgin Galactic to date. This aircraft has several incredible capabilities. Its unique design allows it to reach altitudes of over 50,000 feet, and it can carry payloads weighing up to 35,000 pounds. Many aircraft can carry heavy weight to mid-level altitudes, and some aircraft can carry modest payloads above 50,000 feet. But this combination of high altitude heavy lift capability is very rare. We believe this is an opportunity. Turning to slide six, as we've worked with industry experts to advance the design and planning of our next carrier ship, we believe the same high altitude heavy left capability that supports Virgin Galactic suborbital spaceflight business can also be of value to government and research customers, especially when a derivative model adds extended flight duration. HAIL aircraft, HAIL being an acronym for high altitude long endurance air vehicles, are needed for several types of government and research missions. And we plan to explore the opportunity for a unique hail heavy derivative of our carrier platform in the future. But first things first, and the absolute first thing is to bring Virgin Galactic to EBITDA positive operations by putting two of our new spaceships into service. So let's turn to slide seven and talk about how we are unlocking the growth and profitability of Virgin Galactic. 2024 was the year we designed our new spaceships. 2026 will be the year we fly our new spaceships. But 2025 is the year we actually build the first of these amazing new vehicles. With safety above all as the bedrock value of Virgin Galactic, we are working diligently to bring these ships to life with exceptional quality embedded at every stage. One of the places we have invested heavily in quality is the long-lasting aerospace tools that are used to build the parts of our spaceship. These tools are key to creating the best possible parts and the most efficient assembly for each and every spaceship. These tools are also key to creating long-term value, as they will be used again and again to expand our fleet. Slides 8 through 13 of the presentation have been included to provide a glimpse into the incredible progress that's been made by our Virgin Galactic teammates as well as by the hugely dedicated teams at Carbon Aerospace and Bell Textron. And while I can't name them all on this call, we are extremely appreciative of the outstanding work that is happening across the many companies who make up our extended supply chain. All these groups are excited to be part of commercial spaceship development, and they are building momentum as our collective efforts become very visible and tangible. This is an unusual topic for an earnings call, but I think it's important to share this level of detail as it underpins our progress and our forecasted delivery dates. There are three structural elements that come together to build our spaceships. The fuselage, the feather, and the wing. If you're following along with the presentation, there will be a graphic of the spaceship in the upper right corner of these upcoming slides, and the images on the slide refer to the sections highlighted in green. In slide eight, You can see the primary fuselage subassembly tools that are located in Carbon's fabrication facility. These tools are used to fabricate the upper and lower skins of the cabin shell. Moving to slide 9, you can see the Feather subassembly tooling. These tools have highly complex geometries, and they are used to make the largest part in our spaceship. Slide 10 shows the bulkhead, which is the major structural element that separates the cabin from the rocket system. The image shows the sheets of carbon fiber being laid up within the bulkhead tool before the entire assembly is sent to the autoclave to cure the part. On slide 11, we are using an example with the wing to give you a sense of how the entire part fabrication process works. Starting at the left, the first image shows technicians placing layers of carbon fiber in precise patterns with varying thicknesses on the tool. Once this layup process is complete, The tool and the carbon fiber are moved into an autoclave, which is a huge pressurized oven that cures the part in a way that gives our composite structures their strength. On the right, you can see the finished wing part ready for inspection and shipping to the spaceship factory in Phoenix. On slide 12, you can see the process steps used to create our oxidizer tank. This tank is a critical component of the spaceship that holds our liquid oxidizer for the rocket motor. powers the spaceship to space. The oxidizer tank in our prototype ship, Unity, only supported 40 to 50 flights before needing replacement, which would have required extensive maintenance downtime. The first of our new tanks is complete and is shown here in the test stand about to enter cycle testing. Cycle testing will establish the expected lifespan of the tank, which we project to be many times higher than Unity's. This is one example of the many places we have redesigned our spaceship to minimize maintenance downtimes and enable multiple spaceflights per week on a sustained basis. Our next tank will be entering the autoclave this coming week. This tank is designated for our first spaceship, and it is on schedule to arrive in Phoenix in time for installation into the fuselage. Slide 13 shows a still frame from a video our spaceflight president, Mike Moses, released this morning highlighting the top 10 things he was excited to see happen over the last month. If you haven't seen it, it's a quick and a fun way to showcase our progress, and I encourage you to watch it on our website or social channels. This will be an ongoing feature for Mike every month or two, and we will make it available to our customers, our investor base, and our fans so they can track along with our progress. Slide 14 previews several key milestones that will be taking place in 2025 and 2026. In March, we'll start assembly of our first spaceship in our new spaceship factory. This moment has been years in the making, and our manufacturing team in Phoenix is chomping at the bit. Building and testing of the first ship continues throughout the year, and we'll be highlighting the many tangible milestones along the way to mark our progress. Our first test flight, a glide flight, is expected in spring 2026. which will lead to our first research space flight in summer 2026 and our first private astronaut flight, which is expected in the fall 2026. It's exciting to see the momentum and visible progress ramping up. As the ship comes together, we will be inviting our customers into our spaceship factory to meet the team and see how the ships that will bring them to space are being built. Speaking of our customers, I was recently talking with one of our future astronauts about how different our approach to building these new spaceships is relative to how our prototype spaceship was built. She was very curious to understand how we are building and flight testing new spaceships so much faster than we had done in the past. I imagine that if a long-term customer is curious, as likely some of you are as well. So I've invited Mike Moses, our space line president, to share his perspective on the changes that drive confidence in our current schedule. Over to you, Mike.