Cue Health gained notable contracts with the NBA and Google. Now, the company says job cuts are a result of 'economic challenges' and a drop in government funding.
San Diego’s Cue Health, which went public last year in an IPO valued at nearly $3 billion, is laying off 170 manufacturing employees, due to “economic challenges” and cuts to government funding for COVID-19 testing, a company spokesperson said in a statement Wednesday.
The majority of laid-off workers are based out of the testing company’s Vista location, with the rest working at its two facilities in Sorrento Valley, according to the Worker Adjustment and Retraining Notification Act notice filed with the state. The United States also recently relaxed its pandemic rules for Americans returning from international travel and nixed a requirement to show proof of a negative COVID-19 test., the company noted that it has historically relied on the Department of Defense and a small number of customers for the majority of its revenue. Last year, funding from the Department of Defense made up approximately 61 percent of Cue Health’s total revenue.
Recently, Cue Health was excluded from a contract issued by the Defense Logistics Agency for COVID-19, influenza and respiratory syncytial virus rapid test kits and analyzers,. The company protested the decision to exclude its proposal as “the result of an unreasonable and unequal evaluation” but Cue’s protest was denied in May.
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