Juul Labs has slashed its total valuation to $10 billion. While still a hefty sum compared to smaller vaping manufacturers, the announcement places the industry giant in a vice.
In January of 2020, the company valued itself at $20 billion. The latest valuation, according to numbers at the end of its fiscal third quarter, placed the company at a $67.64 per share valuation. In May of this year, Juul also announced that it cut its valuation from the beginning state of affairs for 2020 valuations to $13 billion.
In December of 2018, the publicly-traded Altria Group (owner of Philip Morris USA) invested a 35 percent stake sending Juul’s value at the time to a whopping $38 billion.
K.C. Crosthwaite, Juul’s current chief executive announced the valuation change in a memo that was originally reported by The Wall Street Journal on October 29, 2020.
“Today’s valuation does not surprise me, and I expect other investors to also arrive at lower valuation marks that factor in our recent restructuring,” Crosthwaite said, according to coverage from Reuters, Bloomberg, and The Wall Street Journal.
Vaping Post reached out to Juul Labs and Altria Group for comment. Our requests for comment were not returned by publication time.
In the memo, Crosthwaite further praised Juul’s actions to reduce costs. Financial disclosures show that the company recorded about $934 million in overall operating expenses in the first half of 2020, with at least $2.6 billion reported all of the year prior.
Investments moving forward will before science and future product development, Crosthwaite said. According to statements, Juul has lost a significant number of employees because of regulatory scrutiny and the rise of underage vaping, and the coming series of state-level flavor bans that have hit the overall demand for other products that the company’s consumers saw as the most popular items to buy.
The company also said, in September, that they are exploring options to pull out from European and Asia-Pacific markets to save operating expenditures.
This story is developing. We are pending regulatory filings to confirm some of the claims in the story.