23andMe is laying off 40% of its workforce, or more than 200 employees, and shutting down its therapeutics division as the struggling genetic testing company tries to cut costs.
The latest restructuring efforts were announced by 23andMe on Monday. The company said it plans to complete ongoing clinical trials “as quickly as practicable” – and that it is currently evaluating “strategic alternatives” for assets related to its drug development and research programs, including studies on potential cancer treatments.
In a prepared statement, Anne Wojcicki, CEO and co-founder of 23andMe, said the company is “taking these difficult but necessary actions” as it focuses on “the long-term success of our core consumer businesses and research partnerships.”
The restructuring comes amid a period of turmoil at California-based 23andMe, which recently saw a high-profile data breach, several previous layoffs and mounting losses that sent the company’s shares tumbling in recent years.
In September, all of 23andMe’s independent directors also resigned from the board – a rare move that followed lengthy negotiations with Wojcicki, who attempted to take the company private. The seven outgoing directors said they had not yet received an adequate transaction proposal from the CEO and cited a “clear” disagreement over the future of 23andMe.
Wojcicki said at the time that she was “surprised and disappointed” by the firing, but insisted that keeping 23andMe private and “away from the short-term pressures of the public markets” would be best for the company in the long run.
After Wojcicki left as the sole member of the board of directors for more than a month, 23andMe announced in late October that it had appointed three new independent directors.
23andMe went public in 2021 and has since struggled to find a profitable business model — especially since most buyers of its saliva-based test kits only need to purchase once. The company reported a net loss of $667 million for the last fiscal year, more than double the previous year’s loss of $312 million.
23andMe posted another loss in its quarterly figures on Tuesday, albeit with a smaller dent than in previous quarters. The company reported a net loss of $59.1 million for the second quarter of fiscal 2025, compared to a loss of $75.3 million for the prior year.
However, revenue in the second quarter was $44.1 million, compared to $50 million a year earlier. The company cited lower sales of test kits and telehealth orders, as well as a decline in research revenue, but said this was partially offset by growth in membership services.
23andMe anticipates the job cuts and other restructuring efforts announced Monday to reduce operating costs 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 payments and other severance-related costs.
23andMe ended the quarter with cash and cash equivalents of $127 million, compared to $216 million at March 31, 2024.
Last month, 23andMe completed a 1-for-20 reverse stock split. Shares fell nearly 4% Tuesday afternoon to close at about $4.43.
