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Lidar company Luminar Technologies, Inc. (NASDAQ:LAZR) is reducing its workforce by 20% and relying more heavily on its contract manufacturing partner as it restructures towards a more “asset-light” business model to scale production. The stock is trading lower, and it went down as much as 13% on Monday.
The workforce reduction will impact about 140 employees. The company will also part ways with most of its contract workers.
Also Read: Will Luminar Technologies Need To Raise $1B In Capital? This Bearish Analyst Answers
Founder and CEO Austin Russell emphasized in a letter on Luminar’s website that the company is at a crossroads. While its core business remains strong in technology, product, industrialization, and commercialization, challenges in the capital markets require a shift in the business model and cost structure. He noted that the restructuring aims to expedite product delivery, significantly cut costs, and enhance profitability, TechCrunch reports.
Luminar aims to lower operating costs by $50 million—$65 million annually, partially by reducing its global footprint through subleasing some facilities. The company will retain its Florida development, testing, and research facility.
In April, Luminar shipped production lidar sensors to Volvo for their EX90 SUV. It announced a deeper partnership with TPK Holding, a Taiwanese contract manufacturer, which has committed to an exclusive relationship with Luminar.
In April, BofA Securities analyst downgrated the stock citing weaker demand for EV, leading to a cash flow breakeven by 2030. He also flagged the need to raise $1 billion in incremental capital through 2025, which would dilute existing shareholders.
Luminar Technologies stock lost over 74% in the last 12 months. Investors can gain exposure to the stock via Direxion Moonshot Innovators ETF (NYSE:MOON) and First Trust Nasdaq Artificial Intelligence And Robotics ETF (NASDAQ:ROBT).
Price Action: LAZR shares traded lower by 7.14% at $1.56 premarket on the last check Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
