Starfighters Space, Inc. (FJET) - Q2 2026 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2026. Starfighters Space, Inc. operates a commercial fleet of F-104 supersonic aircraft from Kennedy Space Center, Florida, and Midland, Texas, focusing on launch services and airborne testbeds for hypersonic R&D. The Company is classified as an emerging growth company and a smaller reporting company. As of August 14, 2026, there were 54,996,019 shares of common stock outstanding.
Key Financial Metrics
| Metric | Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 |
|---|---|---|
| Revenue | $0 (Flight training income ceased) | $354,140 |
| Net Loss | $(15,727,338) | $(4,587,534) |
| Operating Loss | $(15,658,611) | $(4,056,871) |
| Cash and Restricted Cash | $2,399,572 | $3,814,331 |
| Short-term Investments | $21,730,346 | $15,274,175 |
| Total Assets | $32,532,280 | $28,386,884 |
| Total Liabilities | $2,754,334 | $3,486,332 |
| Working Capital | $25,742,338 | $17,091,337 |
Note: The Company reported no revenue for the six months ended June 30, 2026, compared to $354,140 in flight training income in the prior year period.
Material Changes vs. Prior Period
- Significant Loss Increase: Net loss increased by approximately $11.1 million year-over-year, driven primarily by a $5.15 million impairment of aircraft deposits paid to Aerovision LLC and a $395,033 loss due to misappropriation of assets by the former CEO.
- Operating Expenses: Selling, general, and administrative (SG&A) expenses surged to $10.4 million (from $3.6 million), largely due to $4.5 million in stock-based compensation and increased legal/professional fees related to litigation and public company compliance.
- Capital Raise: The Company completed a PIPE financing in May 2026, issuing 5.2 million shares for gross proceeds of $17.5 million.
- Debt Reduction: Related party notes payable of $1.5 million were repaid using funds misappropriated by the former CEO, reducing total liabilities.
- Asset Restriction: Approximately $1.2 million in cash and investments are currently restricted due to bank freezes stemming from disputes with the former CEO.
Outlook, Risks, and Contingencies
- Going Concern: Management has raised substantial doubt about the Company's ability to continue as a going concern due to a history of losses, negative operating cash flows, and restricted access to bank accounts. Future operations depend on raising additional capital.
- Litigation - Former CEO: Rick Svetkoff (former CEO) filed a lawsuit seeking over $26 million in damages for alleged breach of fiduciary duty. Conversely, the Company is pursuing recovery of $1.9 million in unauthorized withdrawals and transfers made by Mr. Svetkoff and his spouse.
- Litigation - Aerovision: The Company filed a lawsuit against Aerovision LLC for breach of contract and conversion regarding the $5.15 million deposit for F-4 Phantom II aircraft, which were never delivered. The deposit has been fully impaired.
- Litigation - Mountain CI Holdings: A subsidiary is facing a claim for $610,000 in alleged unpaid loans from 2014-2021; the Company denies the allegations.
- Internal Controls: The Company identified material weaknesses in internal controls, specifically regarding segregation of duties, banking authorities, and complex accounting, which contributed to the asset misappropriation.
- Operational Milestone: Successfully completed wind tunnel testing for the STARLAUNCH 1 vehicle in January 2026.
Investor Verification Checklist
- Recovery of Misappropriated Funds: Verify the status of legal proceedings to recover the $395,033 net loss from asset misappropriation and the $1.5 million applied to related party debt.
- Aerovision Litigation Outcome: Monitor the progress of the lawsuit against Aerovision to determine if any portion of the $5.15 million impaired deposit can be recovered.
- Liquidity Runway: Assess the sufficiency of the $17.5 million PIPE proceeds against the current burn rate, considering that ~$1.4 million of cash/investments remains restricted by banks.
- Revenue Generation: Confirm timelines for the resumption of flight training income and the commercialization of the STARLAUNCH platform, as revenue was $0 for the period.
- Internal Control Remediation: Review the implementation of new banking resolutions and dual-approval protocols to prevent future unauthorized transactions.