Virgin Orbit, the satellite launch company founded by the billionaire entrepreneur Richard Branson, is pausing all operations and furloughing nearly all of its employees, in an attempt to shore up its finances.
Employees were notified Wednesday in an all-hands staff meeting, as was first reported by CNBC, but the company has not said how long the operational hold will last.
“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 company said in a statement provided to NBC News.
The decision follows a tumultuous few months for the California-based company. Virgin Orbit’s first attempt to launch satellites from the United Kingdom failed in January, and its rocket and nine onboard satellites were destroyed.
In a report filed Wednesday to the U.S. Securities and Exchange Commission, Virgin Orbit said the company-wide operational hold was put in place “in order to conserve capital while the Company conducts discussions with potential funding sources and explores strategic opportunities.”
The news sent the company’s shares tumbling 18.8% in extended trading Wednesday, according to Reuters.
Virgin Orbit was founded in 2017 with the aim to launch small satellites into orbit. The company uses a modified 747 passenger jet to carry and then release its LauncherOne rocket from an altitude of around 35,000 feet.
Virgin Orbit officials have said that this system of launching from the air gives the company more flexibility over competitors whose rockets lift off from launch pads on the ground.
The company’s failure in January was a major setback. The mission was a collaboration between Virgin Orbit, the U.K. Space Agency, the Royal Air Force and the Cornwall Council, and marked the aerospace firm’s first international launch attempt.
A subsequent investigation found that an engine in the rocket’s upper stage malfunctioned, causing it to shut down prematurely.
“In space launch, a failure is painful for all involved,” Virgin Orbit CEO Dan Hart said in a statement Feb. 14. “Intense disappointment gets quickly channeled into the motivation to dig into the cause, to understand all contributing elements and to thereby get back to flight with a better system and a wiser team. Our investigation is not yet complete; the team is hard at work and we’ll pursue the cause and contributors to wherever the system analysis takes us.”
Prior to the U.K. outing, Virgin Orbit’s LauncherOne rocket successfully reached orbit four times on missions launched from California’s Mojave Air and Space Port.
In a statement, Virgin Orbit said its next rocket, for an upcoming launch from California, is in the “final stages of integration and test,” but the company has not released any further details on the timing of that mission.