Thu, 16 March 2023 at 5:06 am GMT
Virgin Orbit, the Richard Branson-founded satellite launch firm has paused operations and furloughed staff while it attempts to secure more funding, according to a report.
The changes were announced at an all-hands meeting with employees on Wednesday, Bloomberg reported, citing a source. Nearly all Virgin Orbit staff were furloughed for the week, with limited staff remaining.
Chief Executive Dan Hart told staff in a meeting that the furlough was intended to buy Virgin Orbit time to finalise a new investment plan to help pull the company out of its financial woes, Reuters reported.
A spokesperson for Virgin Orbit, the sibling company of Mr Branson’s space tourism venture Virgin Galactic, confirmed the operations pause in a statement, but did not comment on the furloughs.
“Virgin Orbit is initiating a company-wide operational pause, effective March 16, 2023, and anticipates providing an update on go-forward operations in the coming weeks,” the spokesperson said.
Shares of the company fell as much as 52pc in after-market trading in New York on Wednesday evening after its announcement halting operations.
CNBC reported on the disruptions earlier on Wednesday.
Virgin Orbit had been running low on cash. It reported an operating loss of $149 million (£123.4 million) for the first nine months of 2022 during its previous earnings announcement.
It had also been raising periodic funding from Virgin Investments Ltd. The company is set to report earnings for the fourth quarter of 2022 on March 29.
Virgin Orbit is also recovering from a high-profile launch failure in January. It had been set to launch nine small satellites out of Spaceport Cornwall, in Newquay, in what was supposed to be the first orbital rocket launch from British soil.
The rocket, however, suffered an error during flight and never reached orbit. It burned u on re-entry, leading to the loss of all satellites on board.
Virgin Orbit has since blamed the accident on a fuel filter that became dislodged during the launch.
“On the ops side our investigation is nearly complete and our next production rocket with the needed modification incorporated is in final stages of integration and test,” the spokesperson said.