Virgin Orbit, the small satellite launch service company founded by Richard Branson, has announced that it will be halting operations “for the foreseeable future” due to its inability to secure additional funding to keep the company afloat. This decision comes after the company had furloughed nearly its entire workforce as it paused operations for a week to shore up cash through an investment plan. The company is also laying off 90% of its workforce, cutting 675 jobs and leaving only around 100 employees.
In an all-employee meeting, CEO Dan Hart stated that the company was unable to find funding that would provide a clear path for the company’s future. Hart also told employees that he hopes this move will help to attract new investors and enable the company to eventually resume operations. However, the immediate future of the company remains uncertain.
Virgin Orbit had raised $55 million as a stopgap measure by selling convertible notes to Branson’s Virgin Investments, including $10 million in January. Despite this, the company’s financial woes were significantly more burdensome. In November 2022, the company reported a $43 million third-quarter loss, which raised concerns about the company’s ability to continue operations. The company has sold $10.9 million in convertible notes to Branson’s Virgin Investments, which will help the company in the short term, but its stock price has dropped significantly following news of the company’s financial struggles.
Virgin Orbit is a separate company from Branson’s space tourism company, Virgin Galactic. Branson founded Virgin Orbit as a launch service for small satellites in 2017, working in partnership with Virgin Galactic. The company went public on the Nasdaq last year but has been struggling financially ever since. This latest announcement is a significant setback for the company, which has been working to establish itself as a leader in the small satellite launch service industry.
The layoffs will affect many areas of the company, including engineers, technicians, and administrative staff. Virgin Orbit had been working on several projects, including a project to develop an air-launched rocket system for the U.S. Air Force. It is unclear what will happen to these projects now that the company has ceased operations. The immediate future of the company and its employees remains uncertain, but the hope is that this move will enable Virgin Orbit to eventually resume operations and continue to work towards its goal of making space more accessible for small satellites.
