The company cited the need to be leaner to keep delivering for customers and develop spacecraft and space-based internet.
The company broke its own record with 21 launches in 2018. "This action is taken only due to the extraordinarily hard challenges ahead and would not otherwise be necessary", it reportedly.
"Either of these developments, even when attempted separately, have bankrupted other organisations".
It is believed the layoffs would affect around 600 employees, who would receive a minimum of eight weeks' pay and other benefits, while the company also promised to assist with career coaching and job searching. "This means we must part ways with some talented and hardworking members of our team", the company said.
NASA might still be waiting for its first real test of SpaceX's Crew Dragon spacecraft - which was recently pushed back into February for unspecified reasons - but that's not the only spacecraft SpaceX has been working on.
Musk removed seven senior figures from the firm last June after he became frustrated with the slow pace at which the team were developing and testing the Starlink satellites of the company.
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But the company has several expensive projects in the works.
The management shakeup involved Musk bringing in new managers from SpaceX headquarters in California to replace a number of the managers he fired in Seattle.
This week marks a busy period for SpaceX, with the company due to launch another batch of satellites into space on its Falcon 9 rocket later on Friday.
SpaceX CEO Elon Musk has unveiled the first pictures of a retro-looking, steely rocket called Starship that may one day carry people to the Moon and Mars.
The Starlink project is set to compete with Canada's Telesat and OneWeb to become the first to market with a new satellite-based internet service. As the Times noted, Shotwell told CNBC last year that SpaceX has had "many years" of profitability.
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