Virgin Orbit Holdings Inc (NASDAQ:VORB) shares crashed down to earth in after-hours trading following reports the rocket company was furloughing staff and pausing operations.
Two months after its failed mission in January, chief executive Dan Hart broke the news in a meeting on Wednesday afternoon, confirming operations would be paused for a week, alongside nearly all employees being furloughed without pay, according to CNBC.
Hart reportedly told staff that the company aimed to bring itself time to secure a new investment plan by furloughing staff, as it battles financial woes that have led to it needing emergency funding from founder Sir Richard Branson.
Hart did not confirm when staff could return to work, instead saying he would provide an update by the middle of next week.
Virgin Orbit also said it had nearly completed an investigation into its failed launch of its LauncherOne rocket from Spaceport Cornwall in the UK in January.
"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," it said.
It had reported pre-tax earnings losses of US$49.9mln in its third quarter results in November, having since raised millions of dollars through convertible notes via parent company Virgin Group.
Shares fell as much as 51% in after-hours trading, eventually lifting slightly to US$0.68, 35% lower than Wednesday’s close.