Virgin Galactic took a step to strengthen its balance sheet by converting a portion of its debt into equity as it prepares for commercial operations.
- Virgin Galactic issued a notice on June 2 to partially redeem its 9.80% First Lien Notes due 2028.
- On June 10, the company redeemed $30.5 million of notes by issuing 6.73-million shares to holders.
- About $172 million of First Lien Notes now remain outstanding, with no principal due until March 2028.
Virgin Galactic Holdings (SPCE) shares fell in after-hours trading on Wednesday after ending the regular session in positive territory. At the time of writing, the stock was down 2.76% after ending the regular session 2.61% higher.
The move followed a regulatory filing in which the company said it had completed a debt-for-equity swap aimed at improving liquidity and enhancing financial flexibility ahead of its planned commercial operations in the fourth quarter of 2026.
Liquidity And Capital Strategy
Virgin Galactic Holdings said in the regulatory filing that the company “has taken proactive steps to improve liquidity, mitigate concentration risk associated with debt payments and enhance financial flexibility as it prepares for commercial operation in the fourth quarter of 2026.”
The company issued a notice of redemption on June 2 to partially redeem its 9.80% First Lien Notes due 2028.
Virgin Galactic said the move is part of its broader capital and cash management strategy. The company added that management believes market conditions provided an opportunity to execute the transaction, and that redeeming part of the notes ahead of schedule will reduce ongoing cash interest obligations.
$30.5 Million Debt Redemption Executed
On June 10, 2026, the Company redeemed $30,524,000 of First Lien Notes by issuing 6,734,960 shares of its common stock to holders of the redeemed notes.
The company said the number of notes redeemed and shares issued were determined based on the volume-weighted average price of its stock over a five-day observation period, as specified in the indenture.
Following the transaction, around $172 million of First Lien Notes remains outstanding, with no principal payment due until March 31, 2028, said Virgin Galactic.
SPCE Stock: What Retail Sentiment Says
On Stocktwits, retail sentiment around SPCE shares was in ‘neutral’ territory, down from ‘bullish’ over the past 24 hours. Message volumes were ‘normal.’
SPCE stock has gained over 40% in the past 12 months.
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