In a significant restructuring move, struggling DNA-testing company 23andMe has announced plans to lay off approximately 200 employees, which constitutes 40% of its workforce. The decision comes as the firm aims to navigate serious financial challenges, including a staggering 70% drop in share value this year.
The company's co-founder and CEO, Anne Wojcicki, stated that these layoffs are part of a broader strategy to refocus on the long-term success of its core consumer offerings and research partnerships. “We are taking these difficult but necessary actions as we restructure 23andMe,” Wojcicki explained, highlighting the need to streamline operations amidst growing competition in the ancestor-tracing industry.
In addition to the layoffs, 23andMe will suspend the development of various therapies it had previously been exploring. The company is considering options for these therapeutic projects, which may include licensing or selling them to other firms.
The turmoil comes in the wake of a massive data breach last year, where hackers accessed the personal information of nearly 6.9 million users. While sensitive data such as DNA records remained protected, the breach included details like family trees, birth years, and geographic locations, raising significant concerns about user privacy.
Among its clientele are numerous high-profile individuals, including celebrity rapper Snoop Dogg and billionaire investor Warren Buffett. As 23andMe takes these steps to stabilize its operations, the future of the once-dominant player in the genetic testing market remains uncertain. The company expects to incur one-off costs of $12 million associated with the layoffs, which it anticipates will save approximately $35 million in the long run.
