Disgraced blood-testing firm Theranos is reportedly laying off roughly 100 of its remaining employees in a bid to stave off bankruptcy, just weeks after it reached a settlement with the SEC over fraud charges.
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The Wall Street Journal reported Theranos will cut its workforce “from about 125 employees to two dozen or fewer,” according to sources familiar with the matter. Theranos founder and CEO Elizabeth Holmes told employees about the layoffs at a companywide meeting on Tuesday.
The Journal reported that the layoffs were conducted as an attempt to “preserve cash and avert or at least delay bankruptcy for a few more months.”
Theranos hadn’t responded to FOX Business’ request for comment at the time of publication.
The California-based company previously laid off hundreds of employees in January 2017 and October 2016. At its peak, Theranos had a workforce of roughly 800 employees.
The most recent round of job cuts came weeks after the announcement of an SEC settlement that stemmed from allegations of fraud against Theranos. The company was charged with raise more than $700 million from investors through misleading statements about the effectiveness of its blood-testing devices.
The settlement required Holmes to give up voting control of the company and return nearly 19 million shares to investors. Holmes also has to pay a $500,000 fine and agree to a 10-year ban from serving as a director of a public company.