Virgin Orbit suspends operations and lays off 85 percent of the workforce

Virgin Orbit, the satellite-launching subsidiary of Richard Branson’s Virgin Group, has announced it will lay off 85 percent of its workforce and cease operations “for the foreseeable future.” The company, which aimed to offer a cheaper alternative to launching small satellites into orbit, had struggled to secure funding to stay afloat and compete with larger players in the private space industry such as SpaceX and Blue Origin.

According to a regulatory filing with the US Securities and Exchange Commission, Virgin Orbit will cease all operations immediately and cut 675 positions across each division. Layoffs are expected to be completed by April 3, leaving only 100 employees at the company. Virgin Orbit will pay approximately $15 million in severance and other costs related to winding down the business, paid for by a $10.9 million cash injection from Branson’s investment arm, Virgin Investments (as reported by Financial Times).

“Unfortunately, we have not been able to secure the funding to provide a clear path for this company. We have no choice but to implement immediate, dramatic and extremely painful changes,” Virgin Orbit CEO Dan Hart said, according to audio of the meeting obtained by CNBC. Hart described the meet as “probably the hardest all-hands we’ve ever done in my life.”

The announcement comes two weeks after Virgin Orbit suspended operations and laid off nearly its entire workforce on March 15 as the company sought to secure additional investment. The satellite launch company revealed an operating loss of $50.5 million in its latest quarterly report, and Branson’s Virgin Group has reportedly injected $60 million to keep the business afloat since November.

Virgin Orbit emerged as an offshoot of Branson’s space tourism company Virgin Galactic in 2017. Unlike rival companies such as SpaceX that launch heavy rockets from the ground, Virgin Orbit launched its LauncherOne two-stage rocket from the air, carried to an altitude of 35,000 feet by a converted Boeing 747 called Cosmic Girl. It has completed six total missions since 2020, with four successful launches and two failures.