Virgin Orbit, the space firm that kicked off Long Beach’s aerospace resurgence, filed a report Thursday announcing it would lay off 675 employees, 85% of its workforce, after failing to secure funding.

CEO Dan Hart announced the company would cease operations “for the foreseeable future” during an all-hands meeting Thursday afternoon, according to CNBC, which first reported the story.

Representatives for Virgin Orbit did not immediately respond to multiple requests for comment from the Business Journal.

“We have no choice but to implement immediate, dramatic and extremely painful changes,” Hart said in audio obtained by CNBC, adding that this would be “probably the hardest all-hands that we’ve ever done in my life.”

Severance packages, including cash payments and benefit extensions will be provided to all laid off employees, Hart reportedly told staff. The company also will provide support in finding new positions including a “direct pipeline” to jobs at Virgin Galactic, CNBC reports.

“As quickly as possible, I am convening an emergency meeting with our city team, workforce development staff and space industry employers to see how we can come together to keep our workforce strong and amazing talent here in our city,” Mayor Rex Richardson said in a statement Thursday.

Long Beach will activate the Rapid Response Team from Pacific Gateway, the city’s workforce development arm, once details are confirmed with the company, a city statement said. The team will work with Virgin Orbit to ensure affected employees know the resources available to them as well as assist them in obtaining unemployment benefits and connect to other job opportunities within the city.

In partnership with the California Employment Development Department, the team will host federally funded sessions designed to help employees get back to work as quickly as possible, Pacific Gateway Executive Director Nick Schultz said in an email to the Business Journal Thursday.

“The Pacific Gateway team will present on accessing reemployment services both in-person and virtually; including resume development workshops, one-on-one job search assistance, direct referrals to local aerospace companies, and retraining with funding up to $7,500 through the Workforce Innovation Opportunity Act,” Schultz wrote.

The city did not have advance notice of the layoffs, spokesperson Kevin Lee confirmed with the Business Journal. The situation is reminiscent of Gulfstream’s departure from the city in 2020. The company announced that it would leave Long Beach, taking about 700 jobs with it, blindsiding city leaders.

According to the U.S. Securities and Exchange Commission filing, the severance will be paid for through the $10.9 million sale of a senior secured convertible note to Virgin Investments Limited, the investment arm of Sir Richard Branson’s empire, which is wholly owned by the Virgin Group.

In its filing, the company stated it expects to incur about $15 million in charges, including “$8.8 million in severance payments and employee benefits costs, and $6.5 million in other costs primarily related to outplacement services and WARN Act exposure.”

Under the WARN Act, U.S. corporations with 50 or more employees are required to provide 60-day notices before mass layoffs.

Virgin Orbit went public on the Nasdaq at the beginning of last year with a share price over $8. The stock has steadily decreased since and reached a low of just 15 cents per share as of Thursday afternoon.

On March 16, the company placed nearly all of its roughly 750 employees on unpaid administrative leave as it sought funding. On Monday, CNBC reported that late-stage deal talks with Texas-based private investor Matthew Brown for $200 million fell through.

Virgin Galactic first took up residence in a new building in the Douglas Park industrial complex in 2015, marking the beginning of Long Beach’s space boom. In 2017, the facility transitioned to Virgin Orbit, a new branch dedicated to small satellite launch, while Virgin Galactic continued operations elsewhere.

Since Virgin’s move into the city, Long Beach’s space sector has exploded, and it now includes Rocket Lab, SpinLaunch, Relativity Space and Vast Space.

“There are a lot of space industry opportunities here in Long Beach, and we are committed to seeing Space Beach grow and thrive,” Richardson said.

Virgin Orbit developed a new launch system that is deployed from under the wing of a modified Boeing 747, rather than standard land-based launches. The company celebrated four successful missions that put 33 satellites in orbit before its first failure in January of this year.

The recent launch, dubbed “Start Me Up,” was the first international mission for Virgin Orbit and the first orbital launch from United Kingdom soil. The rocket reached space, but a faulty fuel filter became dislodged, shutting down the second stage.

The company has not yet released its full investigation into the failure.

Editor’s note: This story has been updated to include more information from city officials.

Brandon Richardson is a reporter and photojournalist for the Long Beach Post and Long Beach Business Journal.