The past few years have been rough for Magic Leap, and the coronavirus pandemic isn’t helping matters. The company announced today that it will lay off employees at every level of the organization, and though Magic Leap’s CEO, Rony Abovitz, doesn’t cite any particular numbers, The Information reports that around 1,000 people will be forced to leave. (We’ve reached out to Magic Leap for comment and will update this post if we hear back.) That’s about half of the startup workforce. Abovitz says that the recent economic downturn caused by the global spread of the COVID-19 virus has “decreased availability of capital and the appetite for longer term investments.” In other words, the company is having a hard time raising more money.
Despite being around for ten years and going through five rounds of startup funding (which amounted to over $2.5 billion), Magic Leap still seems to be reliant upon investor and partner financing. The company released its first augmented reality headset in 2018, but the Magic Leap One’s sales barely put a dent in the company’s goal of shipping 100,000 units. This resulted in dozens of layoffs in late 2019, and the company has reportedly been searching for a buyer.