British billionaire Richard Branson’s rocket launch company Virgin Orbit has ceased operations as the company seeks more funding.
The Long Beach-based company announced its business interruption on Wednesday, which will take effect Thursday. As part of the move, the company laid off most of its nearly 700 employees. According to a source familiar with the case, these workers will continue to receive benefits during this time.
The company expects the pause to last until next Tuesday, according to a document filed with the U.S. Securities and Exchange Commission. The pause in operations will allow Virgin Orbit to save money while company officials meet with “potential sources of funding” and explore “strategic opportunities,” the document said.
According to the source, the company is considering updating employees on the situation sometime next week.
Founded in 2017 as a spin-off of Branson’s spacecraft manufacturing and space tourism company, Virgin Orbit launches satellites via a rocket that lifts off under the wing of a modified 747 aircraft.
The company launched its first demonstration mission in 2020, but suffered a launch failure earlier this year when the rocket’s upper stage failed prematurely. The failure resulted in the loss of nine satellites.
Virgin Orbit said in a statement Thursday that its investigation into the incident is “close to completion” and that it is in the final stages of testing the newly modified missile.
The company reported revenue of $30.9 million and a net loss of $43.6 million for the third quarter of 2022, compared to no revenue and a loss of $38.6 million for the same period last year.
As a result of the news, shares of Virgin Orbit fell nearly 34% from the previous day’s closing price of $1.01 per share as of 10:50 a.m. (Pacific) Thursday. The stock has been steadily declining since December 2021 when it debuted at $10 per share.
Source: LA Times