Dive Brief:
- Illumina, a manufacturer of DNA sequencing and array-based technologies, is reducing its global workforce by 5% amid a challenging “current macroeconomic environment.”
- At the start of the year, Illumina had 9,100 full-time employees plus more than 1,600 part-time and temporary staffers. The headcount suggests about 500 positions will be affected by the 5% reduction.
- The staff cuts come after Illumina reduced its full-year revenue forecast amid rising inflation, delays to large research projects and a slowdown in purchases of instruments and consumables.
Dive Insight:
Illumina earlier this month laid out the challenges facing its business, telling investors that the inflation, foreign-exchange rates and “customer supply chain issues” that affected operations earlier in the year “persisted and, in some cases, accelerated through the third quarter.” Illumina responded by cutting its forecast.
Now, the company has outlined plans to lower costs amid stalling growth of its business. While the state of California, where Illumina is based, has yet to publish a layoff notice, the company has about 5,700 employees in the Americas, suggesting U.S. staffers will be affected in the cuts.
Illumina expects to take a restructuring charge, which will include expenses related to the “optimization” of its facilities, in the fourth quarter as a result of the headcount reduction. It’s unclear whether the 5% headcount reduction will all be made up of layoffs or if Illumina will enact some of the cuts by leaving vacant positions unfilled. Last year, Illumina’s global voluntary turnover rate was 12%.
"Our third-quarter results were in line with our expectations, with traction across our portfolio offset by challenging macroeconomic dynamics that we expect will continue into 2023," CEO Francis deSouza said in a statement earlier this month.
The company, which reported revenue of $4.5 billion in 2021, said on Nov. 3 it expects sales to be little changed for 2022. Illumina had previously forecast revenue growth of 4% and 5% for the full year.
The layoffs at Illumina are the latest in a series of restructuring actions by life science companies. This year, companies including 10X Genomics, Siemens Healthineers and PerkinElmer have laid off staff and cut costs, citing similar macroeconomic challenges.
