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(Mark One)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

As of July 25, 2023, there were 367,136,598 shares of the Company’s common stock outstanding.

This Quarterly Report on Form 10-Q contains forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning us and other matters. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of management, as well as assumptions made by, and information currently available to management.

Forward-looking statements may be accompanied by words such as “achieve,” “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “future,” “grow,” “increase,” “intend,” “may,” “opportunity,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strategy,” “target,” “will,” “would,” or similar words, phrases, or expressions. These forward-looking statements are subject to various risks and uncertainties, many of which are outside our control. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the following:

•any delay in future commercial flights of our spaceflight fleet, which is comprised of our spaceship, VSS Unity, and our mothership carrier aircraft, VMS Eve;

•our ability to successfully develop our next generation vehicles, and the time and costs associated with doing so;

•our ability to conduct test flights;

•our ability to operate our spaceflight system after commercial launch;

•the safety of our spaceflight systems;

•the development of the markets for commercial human spaceflight and commercial research and development payloads;

•our ability to effectively market and sell human spaceflights;

•our ability to convert our backlog or inbound inquiries into revenue;

•our anticipated full passenger capacity;

•our ability to achieve or maintain profitability;

•delay in development or the manufacture of spaceflight systems;

•our ability to supply our technology to additional market opportunities;

•our expected capital requirements and the availability of additional financing;

•our ability to attract or retain highly qualified personnel;

•the effect of terrorist activity, armed conflict, including any escalation of hostility arising out of the conflict between Russia and Ukraine, natural disasters or pandemic diseases, on the economy generally, and on our future financial or operational results, and our access to additional financing;

•consumer preferences and discretionary purchasing activity, which can be significantly adversely affected by unfavorable economic or market conditions;

•extensive and evolving government regulation that impact the way we operate;

•risks associated with international expansion;

•our ability to maintain effective internal control over financial reporting and disclosure and procedures; and

•our ability to continue to use, maintain, enforce, protect and defend our owned and licensed intellectual property, including the Virgin brand.

Additional factors that may cause actual results to differ materially from current expectations include, among other things, those set forth in Part I, Item 1.“Business,” Part I, Item 1A. “Risk Factors,” and Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “Annual Report on Form 10-K") and in Part I, Item 2. “Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Report on Form 10-Q. Although we believe that the expectations reflected in the forward-looking statements are reasonable, our information may be incomplete or limited, and we cannot guarantee future results. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

Each of the terms the “Company,” “Virgin Galactic,” “we,” “our,” “us” and similar terms used herein refer collectively to Virgin Galactic Holdings, Inc., a Delaware corporation, and its consolidated subsidiaries, unless otherwise stated.

									June 30, 2023												December 31, 2022
Assets
Current assets:
Cash and cash equivalents									$	358,309											$	302,291
Restricted cash									39,726												40,336
Marketable securities, short-term									581,913												606,716
Inventories									18,250												24,043
Prepaid expenses and other current assets									26,510												28,228
Total current assets									1,024,708												1,001,614
Marketable securities, long-term									—												30,392
Property, plant and equipment, net									69,869												53,658
Other non-current assets									52,208												54,274
Total assets									$	1,146,785											$	1,139,938
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable									$	24,728											$	16,326
Accrued liabilities									59,118												61,848
Customer deposits									100,112												102,647
Other current liabilities									4,035												3,232
Total current liabilities									187,993												184,053
Non-current liabilities:
Convertible senior notes, net									416,795												415,720
Other long-term liabilities									57,456												59,942
Total liabilities									662,244												659,715
Commitments and contingencies (Note 13)
Stockholders' Equity
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; none issued and outstanding									—												—
Common stock, $0.0001 par value; 700,000,000 shares authorized; 336,760,534 and 275,397,229 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively									34												28
Additional paid-in capital									2,404,322												2,111,316
Accumulated deficit									(1,917,544)												(1,623,795)
Accumulated other comprehensive loss									(2,271)												(7,326)
Total stockholders' equity									484,541												480,223
Total liabilities and stockholders' equity									$	1,146,785											$	1,139,938

Virgin Galactic Holdings, Inc., together with its consolidated subsidiaries ("Virgin Galactic" or the "Company"), is focused on the development, manufacture and operation of spaceships and related technologies for the purpose of conducting commercial human spaceflight and flying commercial research and development payloads into space.

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Certain information and footnote disclosures, normally included in annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), have been condensed or omitted pursuant to such rules and regulations. However, in management's opinion, the condensed consolidated financial statements reflect all adjustments, including those of a normal recurring nature, necessary to present fairly the Company's financial position, results of operations and cash flows for the periods presented.

The operating results for the three and six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for the entire fiscal year. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements contained in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates.

The Company maintains certain cash balances restricted as to withdrawal or use. Restricted cash consists of cash deposits received from future astronauts that are contractually restricted for operational use until the condition of carriage is signed or the deposits are refunded.

The amortized cost, unrealized loss and estimated fair value of the Company's cash, cash equivalents and marketable securities are as follows:

The Company included $2.7 million and $4.5 million of interest receivable in prepaid expenses and other current assets as of June 30, 2023 and December 31, 2022, respectively.

The Company recognizes amortization and accretion of purchase premiums and discounts on its marketable securities within interest income in the accompanying condensed consolidated statements of operations and comprehensive loss. The Company recognized $2.0 million in accretion income, net and $1.8 million in amortization expense, net for its marketable securities for the three months ended June 30, 2023 and 2022, respectively. The Company recognized $2.5 million in accretion income, net and $4.0 million in amortization expense, net for its marketable securities for the six months ended June 30, 2023 and 2022, respectively.

As of June 30, 2023, the amortized cost and estimated fair value of the Company's marketable securities were $584.2 million and $581.9 million, respectively. These marketable securities all had contractual maturities within one year and, accordingly, have been presented in current assets in the accompanying condensed consolidated balance sheet.

Inventories are comprised of the following:

Property, plant and equipment consists of the following:

The following table sets forth a summary of depreciation and amortization expense related to property, plant and equipment:

The components of expense related to leases are as follows:

The components of supplemental cash flow information related to leases are as follows:

The supplemental balance sheet information related to leases is as follows:

Right-of-use assets are presented in other non-current assets and lease liabilities are presented in other current liabilities and other long-term liabilities in the accompanying condensed consolidated balance sheets.

The components of accrued liabilities are as follows:

On January 19, 2022, the Company completed an offering of $425 million aggregate principal amount of convertible senior notes (the "2027 Notes"). The 2027 Notes are senior unsecured obligations of the Company and bear interest at a fixed rate of 2.50% per year. Interest is payable in cash semi-annually in arrears on February 1 and August 1 of each year, beginning on August 1, 2022. The 2027 Notes mature on February 1, 2027 unless earlier repurchased, redeemed or converted.

The net carrying value of the 2027 Notes is as follows:

During each of the three months ended June 30, 2023 and 2022, the Company recognized $3.2 million of interest expense on the 2027 Notes, including $0.5 million and $0.4 million of amortized debt issuance costs, respectively.

During the six months ended June 30, 2023 and 2022, the Company recognized $6.4 million and $5.6 million of interest expense on the 2027 Notes, respectively, including $1.1 million and $0.8 million of amortized debt issuance costs, respectively.

Income tax expense was $34,000 and $23,000 for the three months ended June 30, 2023 and 2022, respectively. Income tax expense was $162,000 and $48,000 for the six months ended June 30, 2023 and 2022, respectively. The effective income tax rate was nil for three and six months ended June 30, 2023 and 2022. The effective tax rate differs from the U.S. statutory rate primarily due to a full valuation allowance against net deferred tax assets where it is more likely than not that some or all of the deferred tax assets will not be realized.

In August 2022, the Company entered into a distribution agency agreement with Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC (each, an "Agent" and collectively, the "Agents") providing for the offer and sale of up to $300 million of shares of the Company's common stock from time to time through the Agents, acting as sales agents, or directly to one or more of the Agents, acting as principal(s), through an "at the market offering" program (the "2022 ATM Program").

The Company completed the 2022 ATM Program in June 2023, selling a total of 59.4 million shares of common stock and generating $300 million in gross proceeds since its inception, before deducting $3.0 million in underwriting discounts, commissions and other expenses.

In June 2023, the Company entered into a distribution agency agreement with the Agents providing for the offer and sale of up to $400 million of shares of the Company's common stock from time to time through the Agents, acting as sales agents, or directly to one or more of the Agents, acting as principal(s), through an "at the market offering" program (the "2023 ATM Program").

During the three months ended June 30, 2023, the Company sold 17.2 million shares of common stock under the 2023 ATM Program and generated $76.8 million in gross proceeds, before deducting $0.8 million in underwriting discounts, commissions and other expenses.

The following table presents net loss per share and related information:

Basic and diluted net loss per share is computed using the weighted-average number of shares of common stock outstanding during the period. The computation of diluted net loss per share excludes the effect of all potential common shares outstanding as their impact would have been anti-dilutive.

The Company has excluded stock-based awards and shares issuable upon conversion of the 2027 Notes from the diluted loss per share calculation because their effect was anti-dilutive. The total number of shares excluded for the three and six months ended June 30, 2023 were 46.7 million. The total number of shares excluded for the three and six months ended June 30, 2022 were 42.7 million.

The Company maintains two equity incentive plans -- the Amended and Restated Virgin Galactic Holdings, Inc. 2019 Incentive Award Plan (the "2019 Plan") and the Virgin Galactic Holdings, Inc. 2023 Employment Inducement Incentive Award Plan (the "Inducement Plan").

Pursuant to the 2019 Plan, the Company has the ability to grant incentive stock options and non-qualified stock options, restricted stock awards, stock appreciation rights, restricted stock units ("RSUs") and other stock or cash-based awards to employees and other service providers of the Company and its subsidiaries and members of the Company’s board of directors. The 2019 Plan, as amended and restated, was adopted by the Company's board of directors and became effective in April 2023, subject to the approval of the Company’s stockholders, and was approved by the Company’s stockholders in June 2023. Prior to the amendment and restatement of the Virgin Galactic Holdings, Inc. 2019 Incentive Award Plan (the “Original Plan”), the Company initially reserved 21,208,755 shares of common stock for issuance. The amendment and restatement of the Original Plan increased the number of shares available for issuance by 8,200,000 shares.

Pursuant to the Inducement Plan, the Company has the ability to grant non-qualified stock options, restricted stock awards, stock appreciation rights, restricted stock units and other stock or cash-based awards to any prospective employee in connection with their commencement of employment with the Company, who (i) is being hired by the Company or (ii) is being rehired following a bona fide period of interruption of employment by the Company, as an inducement material to their commencing employment. The Company's board of directors adopted the Inducement Plan in June 2023 and reserved 2,800,000 shares of common stock for the issuance of awards thereunder.

Stock-Based Compensation

Pursuant to both the 2019 Plan and the Inducement Plan, the Company has the ability to grant performance stock units ("PSUs") and performance stock options ("PSOs"). PSUs are RSUs that vest based on achievement of specified performance criteria. PSOs are stock options that vest based on achievement of specified performance criteria.

A summary of the components of stock-based compensation expense included in the condensed consolidated statements of operations and comprehensive loss is as follows:

As of June 30, 2023, the Company had unrecognized stock-based compensation expense of $6.1 million for stock options and $0.1 million for PSOs. These amounts are expected to be recognized over weighted-average periods of 0.9 years and 0.2 years, respectively. Unrecognized stock-based compensation expense as of June 30, 2023 for RSUs and PSUs totaled $63.7 million and $8.7 million, respectively, which are expected to be recognized over weighted-average periods of 1.2 years and 1.2 years, respectively.

The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company estimates fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which is categorized in one of the following levels:

•Level 1 inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date;

•Level 2 inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability; and

•Level 3 inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date.

The following tables present the Company's financial assets that are recorded at fair value on a recurring basis, segregated among the appropriate levels within the fair value hierarchy:

The following tables present the Company's financial liabilities that are recorded at amortized cost, segregated among the appropriate levels within the fair value hierarchy:

The Company has certain non-cancelable operating leases primarily for its premises. These leases generally contain renewal options for periods ranging from 3 to 20 years and require the Company to pay all executory costs, such as maintenance and insurance. Certain lease arrangements have rent free periods or escalating payment provisions, and the Company recognizes rent expense for such arrangements on a straight line basis.

Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) and future minimum finance lease payments as of June 30, 2023 are as follows:

From time to time, the Company is a party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. The Company applies accounting for contingencies to determine when and how much to accrue for and disclose related to legal and other contingencies. Accordingly, the Company discloses contingencies deemed to be reasonably possible and accrues loss contingencies when, in consultation with legal advisors, it is concluded that a loss is probable and reasonably estimable. Although the ultimate aggregate amount of monetary liability or financial impact with respect to these matters is subject to many uncertainties and is therefore not predictable with assurance, management believes that any monetary liability or financial impact to the Company from these matters, individually and in the aggregate, beyond that provided at June 30, 2023, would not be material to the Company’s consolidated financial position, results of operations or cash flows. However, there can be no assurance with respect to such result, and monetary liability or financial impact to the Company from legal proceedings, lawsuits and other claims could differ materially from those projected.

On May 28, 2021, a class action complaint was filed against the Company in the Eastern District of New York captioned Lavin v. Virgin Galactic Holdings, Inc., Case No. 1:21-cv-03070. In September 2021, the Court appointed Robert Scheele and Mark Kusnier as co-lead plaintiffs for the purported class. Co-lead plaintiffs amended the complaint in December 2021, asserting violations of Sections 10(b), 20(a) and 20A of the Securities Exchange Act of 1934 against the Company and certain of its current and former officers and directors on behalf of a putative class of investors who purchased the Company's common stock between July 10, 2019 and October 14, 2021.

The amended complaint alleges, among other things, that the Company and certain of its current and former officers and directors made false and misleading statements and failed to disclose certain information regarding the safety of the Company's ships and success of its commercial flight program. Co-lead plaintiffs seek damages, interest, costs, expenses, attorneys' fees and other unspecified equitable relief. The defendants moved to dismiss the amended complaint and, on November 7, 2022, the court granted in part and denied in part the defendants’ motion and gave the plaintiffs leave to file a further amended complaint. Plaintiffs’ filed a second amended complaint on December 12, 2022. The second amended complaint contains many of the same allegations as in the first amended complaint. The defendants moved to dismiss the second amended complaint on February 24, 2023 and their motion was fully briefed as of May 23, 2023. The Company intends to continue to vigorously defend against this matter.

On February 21, 2022, March 1, 2022, September 21, 2022, and December 13, 2022, four alleged shareholders filed separate derivative complaints purportedly on behalf of the Company against certain of its current and former officers and directors in the Eastern District of New York captioned Spiteri v. Branson et al., Case No. 1:22-cv-00933, Grenier v. Branson et al., Case No. 1:22-cv-01100, Laidlaw v. Branson et al., Case No. 1:22-cv-05634, and St. Jean v. Branson et al., Case No. 1:22-cv-7551, respectively. On February 13, 2023, an alleged shareholder filed a derivative complaint purportedly on behalf of the Company against certain of its current and former officers and directors in the District of Delaware captioned Abughazaleh v. Branson et al., Case No. 23-cv-00156. Collectively, the complaints assert violations of Sections 10(b), 14(a), and 21D of the Securities Exchange Act of 1934 and claims of breach of fiduciary duty, aiding and abetting breach of fiduciary duty, abuse of control, gross mismanagement, waste of corporate assets, contribution and indemnification, and unjust enrichment arising from substantially similar allegations as those contained in the securities class action described above. The complaints seek an unspecified sum of damages, interest, restitution, expenses, attorneys’ fees and other equitable relief. The cases are at a preliminary stage.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Virgin Galactic Holdings, Inc. is an aerospace and space travel company offering access to space for private individuals, researchers and government agencies. Our missions include flying passengers to space as tourists, as well as flying scientific payloads and researchers to space in order to conduct experiments for scientific and educational purposes. Our operations include the design and development, manufacturing, ground and flight testing, and post-flight maintenance of our spaceflight system vehicles. Our spaceflight system is developed using our proprietary technology and processes and is focused on providing space experiences for private astronauts, researcher flights and professional astronaut training. We have also leveraged our knowledge and expertise in manufacturing spaceships to occasionally perform engineering services for third parties, such as research, design, development, manufacturing and integration of advanced technology systems.

We believe that our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in Part 1, Item 1A. of our Annual Report on Form 10-K titled “Risk Factors.”

We are the first spaceline to receive Federal Aviation Administration approval to carry commercial customers to space. This was through an update to our existing commercial spaceflight license which we have held since 2016. In late June 2023, we completed our first commercial spaceflight, 'Galactic 01,' which marked the start of our commercial service. We continuously monitor our supply chain for potential risk associated with the delivery of materials from our suppliers, which in turn could impact the future schedule for our commercial service. We have identified some areas of risk for timely delivery and continue to work on mitigating these identified risks. Any delays in future commercial spaceflights, whether due to supply chain issues, general macroeconomic factors or otherwise, will impact our ability to generate revenue from human spaceflight.

We have already received significant interest from potential future astronauts. Going forward, we expect the size of our backlog and the number of future astronauts that have flown to space on our spaceflight system to be an important indicator of our future performance. As of June 30, 2023, we had reservations for spaceflights for approximately 800 future astronauts. In August 2021, following Sir Richard Branson's successful test flight, we reopened ticket sales to a select group and increased the pricing of our consumer offerings to a base price of $450,000 per seat. In February 2022, we opened ticket sales to the general public. We are reserving 100 seats within our first 1,000 commercial seats sold for research and scientific experiments. As of June 30, 2023, the tickets sold represent approximately $207 million in expected future spaceflight revenue upon completion of spaceflights.

We commenced our commercial operations with a single spaceship, VSS Unity, and a single mothership carrier aircraft, VMS Eve, which together comprise our only spaceflight system. As a result, our annual flight rate will be constrained by the availability and capacity of this spaceflight system. Additionally, we are temporarily assigning one of the four passenger seats in VSS Unity to be occupied by one of our employees to gather input about the experience in order to help us create a better experience for our customers in the long-term. To reduce the capacity constraint associated with having only one spaceflight system, we are currently developing our next generation spaceflight vehicles, which include our Delta class spaceships and our next generation motherships, which will allow us to increase our annual flight rate. We are dedicating significant engineering resources to the work that precedes production of the future fleet. Simultaneously, we are focused on the flight consistency of Unity and Eve to bring our customers to space and to demonstrate the value of our product.

Our spaceflight systems are highly specialized with sophisticated and complex technology. We have built operational processes to ensure that the design, manufacture, performance and servicing of our spaceflight systems meet rigorous quality standards. However, our spaceflight systems are still subject to operational and process risks, such as manufacturing and design issues, human errors, or cyber-attacks. Any actual or perceived safety issues may result in significant reputational harm to our business and our ability to generate human spaceflight revenue.

The following tables set forth our results of operations for the periods presented. The period-to-period comparisons of financial results is not necessarily indicative of future results.

Revenue for the three months ended June 30, 2023 was primarily attributable to revenue generated from our first commercial spaceflight, 'Galactic 01,' and membership fees related to our Future Astronaut community. Revenue for the three months ended June 30, 2022 was primarily attributable to membership fees related to our Future Astronaut community.

Revenue for the six months ended June 30, 2023 was primarily attributable to revenue generated from our first commercial spaceflight, 'Galactic 01,' and membership fees related to our Future Astronaut community. Revenue for the six months ended June 30, 2022 was primarily attributable to membership fees related to our Future Astronaut community, as well as the performance of engineering services.

Customer experience costs for the three months ended June 30, 2023 were primarily attributable to incremental costs related to our commercial spaceflight and costs related to our Future Astronaut community. Customer experience costs for the three months ended June 30, 2022 were primarily attributable to costs related to our Future Astronaut community.

Customer experience costs for the six months ended June 30, 2023 were primarily attributable to incremental costs related to our commercial spaceflight and costs related to our Future Astronaut community. Customer experience costs for the six months ended June 30, 2022 were primarily attributable to costs related to our Future Astronaut community and labor costs incurred in connection with engineering services.

Research and development expenses increased from $62.3 million for the three months ended June 30, 2022 to $86.6 million for the three months ended June 30, 2023. The increase was primarily driven by a $14.6 million increase in manufacturing sub-contractor and contract labor costs, material costs and other direct costs associated with the development of our spaceflight system, and a $7.0 million increase in compensation and other employee benefit costs.

Research and development expenses increased from $114.2 million for the six months ended June 30, 2022 to $196.4 million for the six months ended June 30, 2023. The increase was primarily driven by a $53.9 million increase in manufacturing sub-contractor and contract labor costs, material costs and other direct costs associated with the development of our spaceflight system, and a $20.6 million increase in compensation and other employee benefit costs.

Selling, general and administrative expenses increased from $44.7 million for the three months ended June 30, 2022 to $51.4 million for the three months ended June 30, 2023. The increase was primarily driven by a $4.0 million increase in compensation and other employee benefit costs.

Selling, general and administrative expenses increased from $81.7 million for the six months ended June 30, 2022 to $101.8 million for the six months ended June 30, 2023. The increase was primarily driven by a $11.7 million increase in compensation and other employee benefit costs, a $2.9 million increase in stock-based compensation, a $1.7 million increase in professional and consulting fees and a $1.0 million increase in facility costs.

Depreciation and amortization expense increased from $2.9 million for the three months ended June 30, 2022 to $3.2 million for the three months ended June 30, 2023, an increase of $0.3 million due to the acquisition of property, plant and equipment.

Depreciation and amortization expense increased from $5.8 million for the six months ended June 30, 2022 to $6.4 million for the six months ended June 30, 2023, an increase of $0.7 million due to the acquisition of property, plant and equipment.

Interest income increased from $2.0 million for the three months ended June 30, 2022 to $8.4 million for the three months ended June 30, 2023. This increase was primarily driven by higher interest rates on marketable securities and deposits in interest bearing accounts.

Interest income increased from $2.8 million for the six months ended June 30, 2022 to $15.7 million for the six months ended June 30, 2023. This increase was primarily driven by higher interest rates on marketable securities and deposits in interest bearing accounts.