According to CNBC news, Virgin Orbit CEO Dan Hart told employees at an all-hands meeting that the company will not be able to obtain “life-saving funds” to keep the company running normally. It will cease operations for the “foreseeable future” and will lay off about 90% of its workforce. “Unfortunately, we have not been able to secure funding to provide a clear path for this company,” Hart said, according to audio of the meeting obtained by The Times.
The company will cut about 90 percent of its workforce, leaving just 100 positions, Hart said, noting that the layoffs will affect every team and department. The company said in a filing with securities regulators that the layoffs totaled 675 people, or about 85% of its workforce.
The retrenched employees will receive measures such as severance pay, benefits continuation and employment support, and two Virgin Orbit executives will also receive “golden parachute” severance packages.
The company has been looking for new sources of funding but has been unable to reach an agreement with any investors, and its largest shareholder, Sir Richard Branson, is unwilling to continue funding the company.
Virgin Orbit is a small satellite launch company owned by British billionaire Richard Branson. Founded in 2017, it mainly develops and commercializes an air launch rocket system called LauncherOne. The system, which can launch small 500-pound satellites into low-Earth orbit, failed in its first test in May 2020. In January 2021, the company successfully put 10 small NASA satellites into orbit and completed its first commercial launch in June. In January and July 2022, the company successfully launched several more satellites. But in January 2023, the company made its first commercial launch in the UK, only to have a $100 fuel filter failure prevent the rocket from delivering a payload to orbit.
In all, Virgin Orbit has made a total of six flights between 2020 and 2023, with only four being successful. That left the company in financial trouble and unable to continue operating. Branson had put $55 million into the failing space company but ultimately abandoned the rescue plan.
It is noticed that the company’s stock price plummeted more than 40% after the market closed on Thursday, and has fallen 82% this year.
