SPACEHAB REPORTS THIRD QUARTER RESULTS
Q3 Revenues Total $24.5 Million

Washington, D.C., May 9, 2001 - SPACEHAB, Inc. (NASDAQ/NMS: SPAB), a leading provider of commercial space services, today announced financial results for the third quarter of fiscal 2001, ended March 31, 2001. SPACEHAB reported a net loss of $3.0 million ($0.26 per basic and diluted share) for the quarter and a loss of $7.2 million ($0.63 per basic and diluted share) for the nine months ended March 31, 2001, as compared with a loss of $635,000 ($0.06 per diluted share) and a loss of $3.9 million ($0.34 per basic and diluted share) for the comparable periods in the prior year.

SPACEHAB recorded revenues of $24.5 million for the third quarter and $75.4 million for the nine months ended March 31, 2001, down 2 percent from $25.1 million and down 2 percent from $77.0 million for the comparable periods in the prior year.

"In our third quarter, we concentrated on reorganizing our business, pursuing an aggressive cost reduction campaign, and refocusing on our strongest near-term market prospects," said SPACEHAB Chairman and Chief Executive Officer Dr. Shelley A. Harrison. "We're also proceeding with our strategy of seeking investment partners for our flight assets to improve our cash position in the near term, and we plan to return to profitability in the next fiscal year," said Dr. Harrison.

During the quarter, SPACEHAB relocated its corporate headquarters from Washington, D.C. to Houston, Texas. The company is maintaining a small Washington, D.C. office near NASA headquarters. The company also opened an office in Huntsville, Alabama, in anticipation of expanding its business with NASA's Marshall Space Flight Center. Ms. Carolyn Griner, former deputy director of the Marshall center, has joined SPACEHAB as Vice President-Huntsville Operations.

In the third quarter, SPACEHAB's Flight Services unit supported its fourth International Space Station (ISS) resupply mission, Shuttle flight STS-102, providing the Integrated Cargo Carrier (ICC) to transfer critical equipment (contract value: $6.6 million). Flight Services continues preparations to fly the ICC and two SPACEHAB Oceaneering Space Systems (SHOSS) boxes on another ISS resupply mission, STS-105, scheduled to launch in the first quarter of fiscal year 2002 (contract value: $5.3 million). Flight Services continues its integration efforts in support of STS-107, a Shuttle research mission scheduled to launch in May 2002, with SPACEHAB's newest flight asset, the Research Double Module (contract value: $63.3 million; asset value: $100 million -- http://www.spacehab.com/rdm).

SPACEHAB's Johnson Engineering (JE) unit received a one-year extension on its contract with NASA to provide flight crew services (JE provides astronaut training at NASA's Johnson Space Center) - this extension represents approximately $42 million in business from May 1, 2001, to April 30, 2002. JE also received a contract award from NASA in the third quarter, valued at approximately $10 million in revenue over the next two and a half years, to continue providing space station configuration management support. This unit continues to develop new markets in museum exhibits.

In the third quarter, SPACEHAB's Astrotech Space Operations subsidiary supported the processing of a Boeing satellite booster stage at its Titusville, Florida, payload processing facility. Astrotech will be processing three more satellites for launches on Atlas and Delta rockets over the next few months. Astrotech's contracts with Boeing and Lockheed Martin to process payloads at the Florida facility provide for $82 million in backlog through 2010. Financing of Astrotech's Florida facility expansion is under way, and construction is expected to be completed in October. At Boeing Sea Launch facilities in California, Astrotech supported the processing of XM Radio's XM-1 and XM-2 satellites.

SPACEHAB and its partner RSC Energia of Russia approved a baseline design for their joint Enterprise™ commercial space station habitat project in the third quarter. The partners are planning a 2003 launch of Enterprise, which will be attached to the Russian side of the ISS, taking the place of a previously planned Russian Docking and Stowage Module. SPACEHAB is seeking equity partners in this project to proceed with assembly this summer, as planned.

SPACEHAB's Space Media subsidiary was reorganized in the third quarter to refocus on near-term business opportunities. Space Media's successful STARS Academy™ global education program (formerly S*T*A*R*S) is gearing up for the next academic year, and discussions are under way with potential collaborators. On STS-107, the STARS program plans to launch a full locker of educational experiments. In February, Space Media launched a STARS biosphere experiment to the ISS, and in April, it transported small payloads to the ISS for two commercial customers. Space Media's online retail business, The Space Store (www.thespacestore.com), continues to expand its line of space-related products.

Founded in 1984, with more than $100 million in annual revenue, SPACEHAB, Inc., is a leading provider of commercial space services. The company is the first to develop, own, and operate habitat modules and cargo carriers providing laboratory facilities and resupply capabilities aboard NASA's Space Shuttles. It also supports astronaut training at NASA's Johnson Space Center in Houston and builds full-scale space-flight trainers and mockups. SPACEHAB's Astrotech subsidiary provides commercial satellite processing services at facilities in Florida and California in support of a range of expendable launch vehicles, including Lockheed Martin's Atlas and Boeing's Delta and Sea Launch rockets. Space Media, Inc. (SMI™, a subsidiary), plans to bring space into homes and classrooms worldwide with television and Internet broadcasting from the International Space Station.