Atai Layoffs 2023: What to Know About the Latest ATAI Job Cuts
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The psychedelics boom may be gathering momentum, but one company in the space is cutting its workforce. Atai Life Sciences (NASDAQ: ATAI) has just announced that it has laid off around 30% of its staff. Shares are up today, but it’s been a very difficult year for this penny stock. After falling more than 62% over the past six months, ATAI stock needs a positive catalyst to turn things around. That’s likely one reason for the layoffs at Atai, which follow the company’s promise to implement an “enterprise-wide cost optimization” initiative, a move that hasn’t yet yielded the intended results.
Let’s examine the company’s recent announcement and see what investors should expect as Atai prepares to hopefully turn a corner.
Atai Layoffs: A Closer Look
Part of ATAI stock’s negative performance can be attributed to some poor clinical trial results. The company began the year by announcing disappointing news regarding a Phase 2 trial of PCN-101 (R-ketamine) in treatment-resistant depression. Since then, stocks have been trending down.
The company must give investors cause for optimism and appears poised to make major changes. CEO Florian Brand recently addressed the layoffs at Atai and gave insight into the motives behind them. In his words:
“As part of our efforts to continue to focus our capital allocation on generating near-term meaningful clinical metrics and to improve our operational efficiencies, we have reduced our team by approximately 30%. I am grateful for the dedication of the team members affected by this decision and for their contribution to our mission.”
Endpoint News reports that the layoffs at Atai will primarily affect workers in non-clinical development roles, such as administrative positions. While reinvesting capital into further research and development can boost stocks in the short term, the company needs to show some actual results if it wants investors to hold on. Layoffs alone will not solve this problem. As InvestorPlace Contributor Muslim Farooque reported that ATAI stock could have significant upside potential, but only if it can improve against the drug, which has flopped in clinical trials.
At the time of publication, Samuel O’Brien held no position (neither directly nor indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publicity guidelines.