- Reuters/Bobby Yip; Business Insider/Dave Smith
A few minutes after SpaceX launched one if its self-landing Falcon 9 rockets on June 28, 2015, it exploded into a rain of debris over the Atlantic Ocean.
NASA had a bunch of cargo riding on top of the rocket, and it tallied its losses at about $112 million. Meanwhile, SpaceX – founded by tech entrepreneur Elon Musk – lost tens of millions it had invested in the launch itself.
But as new financial documents obtained by the Wall Street Journal suggest, the total financial hit to SpaceX may have run into hundreds of millions of dollars.
“The company lost $260 million in 2015 when one of its Falcon 9 rockets, carrying two tons of cargo to the international space station, exploded shortly after liftoff,” writers Rolfe Winkler and Andy Pasztor reported for The Journal.
The financial hit was so hard because of launch delays. SpaceX did an internal investigation and made changes to its rocket fleet and operations. It wouldn’t launch again until December 2015 – when it landed its first Falcon 9 booster on a launch pad – missing out on six of 12 planned launches.
A Falcon 9 launch costs third-parties about $62 million, which means SpaceX missed on its projected launch revenue by roughly $370 million.
It’s unclear how much that colossal revenue loss hurt operating income. Not launching six planned missions certainly beat down profits, but it’s also very expensive to build, certify, fuel up, and launch a rocket – so SpaceX likely did not have to front most of those expenses.
However, they did have to keep paying salaries, leases, and other business expenses, and at a time of rapid growth.
It’s akin to a fast-growing Florida orange-trucking company having a major accident and not making deliveries for about 6 months. Faced with that delay, they would either have to delay buying new orange trucks or just take a loss and maintain their truck buying. Meanwhile, the company has hired more staff and taken on other expenses to accommodate its projected growth, which further eats away at their bottom line.
- Thomson Reuters
Like all analogies, it’s an imperfect one that doesn’t factor in the high cost of launching rockets, insurance claims, industry repercussions, and so on. But that’s the rough financial snapshot of SpaceX in 2015.
However, the company has since suffered another major setback.
On September 1, 2016, a Falcon 9 burst into a fireball during a routine launchpad test, destroying a satellite that Facebook had intended to lease and delayed SpaceX’s launch manifest by more than 4 months. The ensuing investigation has pushed a planned return-to-flight all the way into January 2017, and caused SpaceX to lose at least one customer.
The incident put off a dozen launches planned for 2016, possibly amounting to more than $740 million in revenue losses for the year.
SpaceX reportedly told The Journal it currently “has over $1 billion of cash and no debt” and, as company representatives have previously told Business Insider, 70 planned launches that amount to roughly $10 billion in projected revenue.
And on top of this, the company wants to enshroud the planet in (and sell) high-speed internet as it takes on a jaw-dropping effort to launch 4,425 satellites – more than humanity has launched off Earth.
Read the full financial breakdown of SpaceX and its rocket failures at The Wall Street Journal.
Bob Bryan contributed to this post.