What happened

Shares of Virgin Galactic Holdings (SPCE -13.42%) fell 10.8% in December, according to data provided by S&P Global Market Intelligence, but that only tells half the story. The stock was actually up more than 20% one week into the month, but lost nearly 30% of its value in the weeks that followed after a failed test launch.

SPCE Chart

SPCE data by YCharts.

So what

It's been a year of setbacks for Virgin Galactic. The space tourism company originally had hoped to begin commercial service in 2020, but a series of pandemic-related delays pushed back the test schedule.

In December, the company was able to do a test, but it didn't go to plan. The spaceship's engine failed to ignite, and instead the ship glided back to home port safely. The issue was a lost computer connection, and the abort did allow Virgin Galactic to demonstrate its recovery ability after a failure. But the lack of ignition was a disappointment for investors that weighed on the stock.

The Unity spacecraft rocket burn.

Virgin Galactic's Unity spacecraft with its engine firing. Image source: Getty Images.

The shares were further pressured later in the month when Virgin Galactic revealed via a regulatory filing that large shareholders had liquidated part of their position to raise cash to fund other projects.

Now what

The lesson for investors, to put it simply, is that space is hard. Attempts to reach orbit have never gone smoothly, and Virgin Galactic is just the latest example.

There are still a lot of questions surrounding this company, including whether there are enough potential customers at a sky-high ticket price to make the venture a long-term success. But for those who believe in the growth story, nothing changed in December to alter Virgin Galactic's course.