Virgin Orbit, the satellite-launching subsidiary of Richard Branson’s Virgin Group, has announced that it will lay off 85 percent of its workforce and is ceasing operations “for the foreseeable future”. This comes after failing to secure a funding lifeline. The layoffs are expected to be completed by April 3rd, leaving just 100 employees remaining at the company.
The decision to cease operations comes as Virgin Orbit finishes up its investigation into the mid-flight failure of its launch earlier this year. In January, a jumbo jet took off from Spaceport Cornwall in Newquay carrying a rocket under a wing. After flying to 35,000ft over the Atlantic Ocean, the plane jettisoned the rocket before returning safely. Later investigation revealed that a dislodged fuel filter may have caused the failure.
Sir Richard Branson has injected £11m ($15 million) into Virgin Orbit which will cover most of the severance payments for laid-off staff members.
The company was put in space via four successful launches and small tranches of funding brought in as debt via an investment arm of Branson’s Virgin Group between November 2020 and February 2021 respectively. However, since going public in January this year with a valuation at $3.7 billion on March 21st the stock market valuation had dropped significantly.
According to regulatory filings with US Securities and Exchange Commission (SEC), Virgin Orbit will end all operations immediately and lay off all positions across every department costing approximately $15 million consisting of $8.8 million in severance payments plus about $6.5 million related costs such as finding outplacement services required by WARN Act requirements.
This marks another setback for Sir Richard Branson's space exploration ambitions following last month's failed test flight by his other company - Virgin Galactic - that sent shares plummeting.
This is a developing story that will be updated as more details emerge.