On January 24, 2024, Desktop Metal announced layoffs affecting 50 employees, representing 0.2% of its workforce.
Headquartered in Boston, Desktop Metal operates in the Other industry. The layoffs come amid broader industry challenges and efforts to streamline operations.
Desktop Metal decided to lay off employees as part of a $50 million cost-reduction plan aimed at aligning the company's cost structure with current market dynamics and accelerating its path to profitability amidst a downturn in the additive manufacturing industry. Additionally, the layoffs were influenced by the failed merger with Stratasys, which was expected to stabilize the company.
"The cost-reduction plans announced today, in addition to the $100 million in cost reductions realized in 2023, will help us generate positive cash flow in light of a softer demand environment,” said Ric Fulop, Founder and CEO of Desktop Metal. “We are committed to getting profitable during this challenging period. The vast majority of the cuts will be completed this quarter, resulting in sequential cost reductions across the first half of 2024."
The layoffs are part of a broader strategic business review aimed at aligning the company's cost structure with current market dynamics. This includes efforts to generate positive cash flow and achieve profitability amidst a downturn in the additive manufacturing industry. The company is also focusing on consolidating facilities and rationalizing products to ensure long-term sustainability.
The layoffs at Desktop Metal have significantly impacted its workforce, particularly affecting roles in manufacturing and administrative departments. This reduction in employees is expected to streamline operations but may also lead to short-term disruptions as the company adjusts to a leaner structure.
In the broader additive manufacturing industry, other companies like 3D Systems and Markforged have also announced layoffs recently, reflecting a trend of cost-cutting measures amid declining market demand. These industry-wide reductions highlight the challenges faced by companies in maintaining profitability during economic downturns.
The layoffs signify a pivotal moment for Desktop Metal, marking a shift towards a more streamlined and financially disciplined future. The company is now focused on strategic initiatives to ensure long-term sustainability and growth.
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