Juul plans layoffs — up to 55% of its workforce, source says

E-cigarette giant Juul Labs Inc. could cut more than half its workforce, according to a person familiar with the company’s plans, while it weighs exiting more European and Asian markets — further signs of the once high-flying company’s deteriorating fortunes.

Juul aims to reduce its workforce to about 1,000 employees, down from the current 2,200, the person said. A Juul spokesman said that no final decisions have been made and that the company will continue to evaluate its options.

The San Francisco company announced plans to lay off more workers in a Wednesday message to employees from Chief Executive K.C. Crosthwaite. The email said Juul is still in the exploratory phase and didn’t detail how many employees will be cut or how many countries it may exit. Juul has already cut its workforce by about 40% and halted global expansion.

The Wall Street Journal first reported news of the changes.

A health crisis surrounding vaping that was later linked to faulty cannabis products sent the already embattled Juul into a tailspin last year. U.S. regulators blamed an epidemic of teen vaping on the company. Juul has since tried reorienting itself, shuffling its executive ranks, eliminating sweeter flavors critics said targeted younger customers, and focusing on a regulatory review that will determine whether its products can stay in the U.S. market.

Crosthwaite said in his email that Juul will exit markets that don’t generate sufficient returns and will meet with “key stakeholders� before entering a country in the future. The company has been pursuing that approach in Japan, where it hired a former pharmaceutical executive to lead its efforts.

The company will use its resources to develop new technologies and focus on its core markets, Crosthwaite said. In July, Juul filed an application with the U.S. Food and Drug Administration to keep selling its e-cigarettes. That application is being reviewed.

LaVito writes for Bloomberg.