Due to a lack of additional funding, Virgin Orbit, a rocket company owned by British billionaire Sir Richard Branson, has announced the layoff of 85% of its workforce. According to media reports, the company will also cease operations in the near future. It happened a few weeks after the business temporarily halted operations in an apparent effort to strengthen its finances. Earlier this year, a Virgin Orbit rocket aborted the first satellite launch from UK soil. The price of the company’s shares fell by more than 44% in after-hours trading in New York on Thursday.
Virgin Orbit stated that it chose ” to decrease expenses in light of the company’s inability to acquire meaningful funding” in a file with US regulatory authorities. The job cuts would affect approximately 675 employees “from all sections of the organisation.” According to the statement, Sir Richard’s investment company Virgin Investments invested $10.9 million (£8.8 million) in Virgin Orbit “to pay severance and other expenditures related to the personnel reduction.” According to Virgin Orbit, severance payments and other expenses are expected to total about $15 million. It comes amid media reports that the company’s CEO informed employees that operations would be halted until further notice.
According to CNBC, which broke the story first, Virgin Orbit chief executive Dan Hart remarked at a meeting with staff members, “We have no choice except to implement immediate, drastic, and highly painful changes.” Technology News UK reports Virgin Orbit delayed responding to a BBC request for comment.
