Juul is now worth $24 billion, down from its previous valuation of $38 billion after an investment from tobacco maker Altria in December 2018.
- Juul is planning to lay off between 10% and 15% of its workforce by the end of 2019, The Wall Street Journal's Jennifer Maloney reported on Monday.
- A recent slash of Juul's valuation stripped cofounders Adam Bowen and James Monsees of their billionaire status, Forbes' Sergei Klebnikov reported October 4. Bown and Monsees are now worth $900 million apiece, Forbes estimates.
- The e-cigarette maker is reportedly under criminal investigation by the US Attorney's Office for the Northern District of California amid widespread public concern about its marketing tactics and the long-term health impacts of its products amid a rising number of vaping-related illnesses and deaths.
- On September 25, Juul announced that CEO Kevin Burnes had resigned and that it would stop advertising in the US.
- In a statement to Business Insider, Juul confirmed that the company would be making cuts to its workforce by the end of 2019 in order to "right-size the business."
- Visit Business Insider's homepage for more stories.
Juul is struggling to survive in the midst of a vaping-related public health crisis, and the e-cigarette maker's woes are beginning to impact the company's staffers.
Juul's "workforce will be reduced between now and the end of the year," the company said in a statement to Business Insider's Aaron Holmes on Tuesday. The cuts will affect 10% and 15% of Juul's workforce — approximately 500 people — The Wall Street Journal's Jennifer Maloney reported Tuesday.
In the statement to Business Insider, Juul said the layoffs were part of a company-wide reorganization that will also include investing in initiatives to prevent teens from vaping; suspending broadcast, print, and digital product advertising; and suspending the sale of Mango, Creme, Fruit, and Cucumber pods in the US. Juul also said it would suspend US advertising and some lobbying efforts.
Juul is now worth $24 billion, down from the $38 billion valuation the company hit after an investment from tobacco maker Altria in December 2018, Markets Insider previously reported. Altria's $13 billion investment made Bowen and Monsees billionaires, according to Forbes estimates.
One of the company's biggest investors, hedge fund Darsana Capital Partners, reportedly cut the company's valuation by more than a third on October 3 following increased attention from regulators. As a result, Juul cofounders Adam Bowen and James Monsees lost their billionaire status just ten months after attaining it, according to Forbes estimates.
Bowen and Monsees founded Juul after meeting on smoke breaks while studying product design at Stanford University in 2004, Business Insider previously reported. Ploom, a precursor to Juul, was launched in 2007 and first released Juul products in 2015. The company's Juul line was spun into a separate firm in 2017. The majority of the pair's respective net worths are tied to their 1.75% stakes in the e-cigarette maker, Forbes' Sergei Klebnikov reported.
Juul did not respond to Business Insider's initial request for comment on Bowen and Monsees' net worths or their status as billionaires on October 4.
Juul is undergoing a 'necessary reset'
The Trump administration is currently exploring a ban on flavored vaping products, The Wall Street Journal reported. Such products are responsible for nearly 80% of Juul's sales in the US, according to The Journal. The e-cigarette maker is also reportedly under criminal investigation by the US Attorney's Office for the Northern District of California.
The news of Juul's impending staff cuts comes one month after Juul CEO Kevin Burns resigned on September 25. Burns had taken the role on in December 2017; in a CNBC documentary in July, he issued an apology to parents of teens who were addicted to the company's vaping product.
"As the vapor category undergoes a necessary reset, this reorganization will help JUUL Labs focus on reducing underage use, investing in scientific research, and creating new technologies while earning a license to operate in the U.S. and around the world," Juul CEO K.C. Crosthwaite said in the October 29 statement to Business Insider.