Why it matters: Genetic testing company 23andMe, has announced a dramatic restructuring, including 200 job cuts and the discontinuation of its therapeutics division. This move comes after a devastating year marked by a major data breach and plummeting stock value.
The Cuts: The BBC reports that the company will reduce its workforce by 40%, expecting to save $35 million annually while incurring $12 million in severance and transition costs. The restructuring includes abandoning cancer-treatment research programs as the company refocuses on its core consumer business.
- 200 positions eliminated (Gizmodo)
- Research programs discontinued
Anne Wojcicki, 23andMe’s CEO and co-founder: “We are taking these difficult but necessary actions as we restructure 23andMe and focus on the long-term success of our core consumer business and research partnerships,” said Wojcicki in a press release. “I want to thank our team for their hard work and dedication to our mission. We are fully committed to supporting the employees impacted by this transition.”
Financial Pressure: Since going public in 2021 with a $3.5 billion valuation, 23andMe has faced mounting challenges. The company reported a $59.1 million net loss in its latest quarter, while its stock has dropped over 70% this year, trading below $5.
- Significant quarterly losses
- Stock value plummets
Security Concerns: A 2023 data breach exposed the personal information of 6.9 million users, including family trees and geographic locations, though DNA records remained secure. This incident has further eroded consumer confidence and company value. Consumers need to learn how to protect their DNA data.
