Virgin Orbit, the rocket company founded by British billionaire Sir Richard Branson, will cut 85% of its workforce, the BBC reported Thursday.
Virgin Orbit develops rockets that transport satellites into space, however, since its inception in 2017, the company has failed to turn over a profit. After failing to secure new funding, the firm will cease operations for the foreseeable future and let go 675 employees, according to the BBC. (RELATED: Richard Branson Becomes First Billionaire To Reach Space)
Virgin Orbit lays off most employeeshttps://t.co/qVooiQi13g pic.twitter.com/vjWMAqciFS
— SpaceNews (@SpaceNews_Inc) March 30, 2023
The company recently halted operations and placed staff on furlough payment earlier in March. Following news of the announcement on Thursday, the share price fell more than 44% on the Nasdaq stock exchange.
The company made the decision “in order to reduce expenses in light of the company’s inability to secure meaningful funding,” Virgin Orbit said in an SEC filing. The company said 675 staff would be let go, leaving behind only 100 to run the business, in an effort to cut overall costs.
“We have no choice but to implement immediate, dramatic and extremely painful changes,” Virgin Orbit chief Dan Hart said when addressing employees, according to CNBC.
Branson reportedly promised to introduce $11 million to cover pay packages for employees.