Virgin Orbit will suspend operations beginning Thursday in an apparent effort to strengthen its finances.
Almost all staff at the satellite launch company are expected to be furloughed as well.
The move was announced to employees at a meeting on Wednesday, and further information would be offered next week.
It follows the company’s inability to launch the first satellite mission from British soil in January.
According to a person who attended the event, Chief Executive Dan Hart informed colleagues that the furlough would give Virgin Orbit time to finalize a new investment strategy.
The length of the furlough was not specified, but Mr Hart stated that employees would be given additional information by the middle of next week.
According to Reuters, Virgin Orbit shares fell 18.8% to 82 cents (72p) in extended trade.
A statement from the company said: “Virgin Orbit is initiating a company-wide operational pause, effective March 16, 2023, and anticipates providing an update on go-forward operations in the coming weeks.”
It did not confirm or deny the furlough when asked by BBC News.
In January’s launch, a jumbo jet operated by Virgin Orbit carried a rocket out of
Newquay, Cornwall, to release it high over the Atlantic Ocean.
The rocket launched and appeared to be ascending correctly, but an “anomaly” occurred afterwards.
The satellites it was transporting were unable to be released and were lost. The carrier 747 airplane, Cosmic Girl, returned safely to base.
The flight was later declared a failure by Virgin Orbit because a rocket fuel filter became dislodged, leading one of the engines to overheat.
The statement made by the corporation on Thursday said that the inquiry into the incident was “almost complete” and that “our next production rocket with the requisite modification integrated is in final stages of integration and test”.
The mission was billed as a watershed moment in UK space history, heralding the birth of a domestic launch industry.
The goal is to transform the country into a worldwide player, from satellite manufacture through rocket construction and the development of new spaceports.