British billionaire Richard Branson's rocket-launch firm Virgin Orbit has paused operations as the company searches for more funding.
The Long Beach-based company announced the operational pause Wednesday and it goes into effect Thursday. As part of the move, the firm has furloughed most of its nearly 700 employees. Those employees will continue to have benefits during this time, according to a source familiar with the matter.
The company expects the pause to continue through next Tuesday, according to a document filed with the U.S. Securities and Exchange Commission. The operational pause will allow Virgin Orbit to save money while company officials meet with "potential funding sources" and explore "strategic opportunities," according to the document.
The company is looking at updating employees on the situation sometime next week, according to the source.
Founded in 2017 as an offshoot of Branson's spacecraft manufacturing and space-tourism companies, Virgin Orbit launches satellites via a rocket that blasts off from beneath the wing of a modified 747 airplane.
The company launched its first demonstration mission in 2020 but had a launch failure earlier this year when the rocket's upper-stage shut down prematurely. The failure resulted in the loss of nine satellites.
Virgin Orbit said in a statement Thursday that its investigation of the incident is "nearly complete" and that it is in the final stages of testing the newly modified rocket.
The company reported revenue of $30.9 million and a net loss of $43.6 million in third-quarter 2022, compared with no revenue and a $38.6 million loss in the same period the year prior.
In the wake of the news, Virgin Orbit shares closed at $0.71, down 30% on Thursday from the prior day's close of $1.01 a share. The stock has been in steady decline since December 2021 when it debuted at $10 a share.
