Earth observation company Planet announced on June 26, 2024 that it is laying off about 180 employees, or 17% of its workforce, in an effort to reduce costs and improve operational efficiency[1][2][3]. This is the second major round of layoffs for Planet in less than a year, following a 10% reduction in July 2023[1].
Planet cited the need to align its resources with market opportunities and support long-term growth and profitability as the key reasons for the layoffs[1][3]. The company expects to incur one-time charges of $9.5 million to $10.5 million for severance and other termination costs[1][3].
Despite the layoffs, Planet reaffirmed its financial guidance for the current fiscal year, projecting revenues of $59 million to $63 million in the second quarter with an adjusted EBITDA loss of $7 million to $10 million[1][3]. The company remains focused on achieving adjusted EBITDA profitability in the fourth quarter of fiscal 2025[1].
Analysts speculate that the European offices may bear the brunt of the layoffs, as the average severance cost per employee is lower compared to the previous round in August 2023[4]. This suggests that lower-paying positions in areas like HR, marketing, and communications may be disproportionately affected[4].
The layoffs come as Planet continues to make progress on key initiatives, such as the upcoming launch of its first hyperspectral satellite, Tanager-1, on SpaceX's Transporter-11 rideshare mission in July[1]. The company also recently signed a $20 million agreement to provide hyperspectral data to the Carbon Mapper consortium for tracking greenhouse gases[1].
Planet's decision to restructure its workforce reflects the broader challenges facing the space industry, as companies navigate economic uncertainties and strive to optimize operations[3]. The layoffs are expected to improve Planet's revenue per employee ratio, bringing it closer to industry benchmarks set by competitors like Spire and BlackSky[4].
As Planet navigates this transition, it remains committed to delivering high-quality Earth observation data and services to its customers while working towards its goal of achieving profitability[1][3].
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