NEW YORK – Cue Health is implementing a new cost reduction plan that will result in the layoffs of 388 employees, according to a filing with the US Securities and Exchange Commission dated Jan. 5.
The plan, which is intended to reduce the company's cost structure and improve its operational efficiency, was implemented after a review of Cue's business, operating expenses, and the macroeconomic environment, the filing said. Cue estimated it will record an aggregate restructuring charge of $6.0 million to $8.0 million related to one-time termination benefits.
The layoffs will reduce Cue's workforce by about 26 percent, and termination dates are expected to occur in early March. Payments related to the cost reduction plan will likely be completed by the end of Q2 2023, the firm said.
The news comes six months after the firm laid off 170 people in June due to economic hardships and reduced funding for COVID-19 testing.
Cue went public in 2021 via a $200 million initial public offering that opened at $16.76 per share. As of Friday afternoon, shares were trading at $1.95, up 1 percent on the Nasdaq.
The company offers its molecular Cue COVID-19 Test for at-home and point-of-care use and recently submitted its influenza test, which runs on the same Cue Reader platform, to the US Food and Drug Administration for de novo regulatory approval.
In its most recent quarter, Cue reported revenues of $69.6 million, down 69 percent from the previous year but beating Wall Street analysts' estimates of $58.2 million. Net loss was $66.3 million, or $.45 per share, in the third quarter of 2022 compared to a net income of $19.3 million, or $.13 per share, in the same quarter of 2021. Cue exited Q3 2022 with $304.7 million in cash and cash equivalents and $1.3 million in restricted cash.