23andMe is laying off 40% of its workforce, or more than 200 employees, and discontinuing its therapeutics division as the struggling genetic testing company attempts to slash costs.
The latest restructuring efforts were announced by 23andMe on Monday. The company said it plans to wind down ongoing clinical trials “as quickly as practical” — and that it was currently evaluating “strategic alternatives” for assets related to its drug development and research programs, which include studies on potential cancer treatments.
In a prepared statement, 23andMe CEO and co-founder Anne Wojcicki said the company was “taking these difficult but necessary actions” as it focuses on “the long-term success of our core consumer business and research partnerships.”
The restructuring arrives during a period of turmoil at California-based 23andMe, which has recently included a high-profile data breach, several rounds of previous layoffs and piling losses that plunged the company’s stock over recent years.
Back in September, all of 23andMe’s independent directors also resigned from its board — in a rare move that followed drawn-out negotiations with Wojcicki, who has been trying to take the company private. The seven resigning directors said they had yet to receive an adequate transaction proposal from the chief executive and cited a “clear” difference of opinion on 23andMe’s future.
At the time, Wojcicki said she was “surprised and disappointed” by the resignations but maintained that taking 23andMe private and “outside of the short-term pressures of the public markets” would be best for the company long term.
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After more than a month with Wojcicki left as the sole member of the board, 23andMe announced that it had appointed three new independent directors in late October.
23andMe went public in 2021 and has struggled to find a profitable business model since — particularly with most buyers of its saliva-based testing kits only needing to purchase once. The company reported a net loss of $667 million for its last fiscal year, more than double the loss of $312 million for the year prior.
23andMe posted another loss in quarterly earnings released Tuesday, although with less of a dent than in previous quarters. The company reported a net loss of $59.1 million for the 2025 fiscal year’s second quarter, compared to a loss of $75.3 million for the same year prior.
Revenue, however, totaled at $44.1 million for the second quarter — down from $50 million from the year prior. The company cited lower testing kit sales and telehealth orders, as well as a decrease in research revenue, but said that was partially offset by a growth in membership services.
23andMe anticipates the job cuts and other restructuring efforts announced Monday to reduce its operating expenses and save the company more than $35 million annually. 23andMe also expects to incur up to $12 million in costs, primarily related to one-time severance and other termination-related expenses.
23andMe ended the quarter with cash and cash equivalents of $127 million, compared with $216 million as of March 31, 2024.
Last month, 23andMe completed a 1-for-20 reverse stock split. Shares were down nearly 4% by midday Tuesday, sitting at around $4.43.
© 2024 The Canadian Press
