On March 30, 2023, Virgin Orbit Holdings, which is in the commercial business of aircraft-launched two-stage-to-orbit launch services, laid off 85% of its employees. The announcement came to the fore when Virgin Orbit, the Delaware-based company within the UK-based Virgin Group, filed a Form-8K with the U.S. Securities and Trade Commission. Virgin Group owns a 33% share in Virgin Orbit, while 18% is owned by the United Arab Emirates state-owned holding company – Mubadala.
Virgin Orbit has announced that it will cease operations “for the foreseeable future” due to a lack of funding, according to CEO Dan Hart during an all-hands meeting on Thursday. The layoffs will affect every team and department, and the company will provide a severance package for departing employees, including a cash payment, an extension of benefits, and support in finding a new position. The severance package also includes a “direct pipeline” to sister company Virgin Galactic for hiring.
Hart had been giving the company’s employees daily updates since Monday, when the company delayed a scheduled all-hands meeting. Late-stage deal talks had fallen through with a pair of investors over the weekend, but Hart had said that “very dynamic” investment discussions were continuing. However, the talks ultimately did not result in funding for the company.
Virgin Orbit developed a system that uses a modified 747 jet to send satellites into space by dropping a rocket from under the aircraft’s wing mid-flight. The company’s last mission suffered a mid-flight failure, with an issue during the launch causing the rocket to not reach orbit and crash into the ocean.
The company was among a select few U.S. rocket companies to successfully reach orbit with a privately developed launch vehicle. It has launched six missions since 2020, with four successes and two failures. The company has been looking for new funds for several months, with majority owner Sir Richard Branson unwilling to fund the company further.
Virgin Orbit was spun out of Branson’s Virgin Galactic in 2017. The company previously hired bankruptcy firms to draw up contingency plans in the event it was unable to find a buyer or investor. On the same day that Hart told employees that Virgin Orbit was pausing operations, its board of directors approved a “golden parachute” severance plan for top executives if they are terminated “following a change in control” of the company.
