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Following the completion of its first orbital launch in the US space, shares of Astra Space have surged.
After the announcement of the successful test launch, the shares spiked by about 38% from their closing price of $9.53 on Friday to $13.14 in premarket trading on Monday. S&P 500 and Dow Jones Industrial Average futures also rose at about 0.4%.
Astra Space (NASDAQ: ASTR), founded in 2016, became publicly traded in June through a SPAC merger with Holicity Inc. Its shares pummeled in August following a failed test launch. By the end of the quarter, the company had incurred a $42.5 million operating loss. That’s more than 5 times the company’s operating loss a year ago.
Subsequently, Astra announced a propellant leak as the cause of the failed launch. The company also implemented design changes to correct the problems. Then, it announced a test payload for later in October. This didn’t hold. Rather, the attempted launch was postponed 3 times drowning investor confidence. Thus, the success of this test launch is a major milestone for the company after all the setbacks. The success has attracted praise from Elon Musk’s SpaceX.
The Successful Test Launch Is Only the Beginning
According to the company, the rocket launched from its Kodiak Spaceport in Alaska and reached precise orbit in less than 9 minutes. It carried a US Space Force payload and reached an orbital velocity of 7.61 kilometers per second in just 8 minutes and 47 seconds.
Speaking on the successful test launch, Astra’s founder and Chairman, Chris Kemp had this to say:
“Reaching orbit is a historic milestone for Astra. We can now focus on delivering for our customers and scaling up rocket production and launch cadence.”
Astra rockets, it is hoped, will carry lower-cost satellites into orbit. Thus its rockets are not designed for reuse as a way to drive down launch costs. This is similar to what Ford Motor Company (NYSE: F) did with the car market years ago to drive down prices. When compared with its competitors, Astra seems to be on track. For example, it took 6 years for a SpaceX rocket to reach orbit after the company was formed in 2002.
Astra will discuss the launch further at a briefing by 9 a.m. Eastern time. As of the time of writing, the company has a market capitalization of $2.46B and the stock was trading at $12.26.