SpaceX launched its Starship rocket on its latest test flight on Thursday, but the spacecraft was destroyed following a thrilling booster catch back at the pad.

The spacecraft was supposed to soar across the Gulf of Mexico from Texas on a near loop around the world similar to previous test flights. SpaceX had packed it with 10 dummy satellites for practice at releasing them. It was the first flight of this new and upgraded spacecraft.

A minute earlier, SpaceX used the launch tower’s giant mechanical arms to catch the returning booster. The descending booster hovered over the launch pad before being gripped by the pair of arms dubbed chopsticks.

The thrill of the catch quickly turned into disappointment for not only the company, but the crowds gathered along the southern tip of Texas.

“It was great to see a booster come down, but we are obviously bummed out about ship,” said SpaceX spokesman Dan Huot, adding it would take time to analyse the data and figure out what happened.

The last data received from the spacecraft indicated an altitude of 146 kilometres and a velocity of 21,317km an hour.

The 123-metre rocket had thundered away in late afternoon from Boca Chica near the Mexican border. The late hour ensured a daylight entry halfway around the world in the Indian Ocean. But the shiny retro-looking spacecraft never got nearly that far.

SpaceX had beefed up the catch tower after November’s launch ended up damaging sensors on the robotic arms, forcing the team to forgo a capture attempt. That booster was steered into the gulf instead.

The company also upgraded the spacecraft for the latest demo. The test satellites were the same size as SpaceX’s Starlink internet satellites and, like the spacecraft, were meant to be destroyed upon entry.

Musk plans to launch actual Starlinks on Starships before moving on to other satellites and, eventually, crews.

It was the seventh test flight for the world’s biggest and most powerful rocket. NASA has reserved a pair of Starships to land astronauts on the moon later this decade. Musk’s goal is Mars.

Hours hours earlier in Florida, another billionaire’s rocket company — Jeff Bezos’ Blue Origin — launched the newest supersized rocket, New Glenn. The rocket reached orbit on its first flight, successfully placing an experimental satellite thousands of miles above Earth. But the first-stage booster was destroyed, missing its targeted landing on a floating platform in the Atlantic.