Elizabeth Holmes announces brutal layoffs at Theranos following SEC settlement

As recently as 2015, the plucky blood-testing company Theranos had about 800 employees. But on Tuesday, that number fell to about two dozen or less, according to a report by .

Elizabeth Holmes, founder and CEO of the Silicon Valley biotech company, announced the third, brutal round of layoffs today in an all-hands meeting at the company’s Newark, California office.

The carnage claimed at least 80 percent of the company’s approximately 125-employee workforce that had remained until now.

According to people familiar with the matter, the move is intended to save desperately needed cash and avert—or at least delay—bankruptcy. Though the company was once valued at $9 billion, it has seen its value plummet and funds dwindle after revelations that its highly touted blood-testing technology was faulty and company leaders misled partners, regulators, customers, and investors.

The latest layoffs come less than a month after the company and Holmes settled with the Securities and Exchange Commission over civil charges of “massive fraud.” The SEC claimed that the company raised $700 million in investments by orchestrating an “elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business, and financial performance.”

Without admitting wrongdoing, Holmes and Theranos settled, with Holmes agreeing to pay a $500,000 fine. Also as part of the settlement, she is barred from serving as a director or officer of a public company for 10 years, must return 18.9 million shares of the company, and must relinquish her voting control of Theranos. If Theranos ends up being sold or liquidated, Holmes will not profit until more than $750 million is returned to allegedly defrauded investors and other shareholders. The settlement agreement is still being finalized.

The SEC also charged former Theranos president Ramesh “Sunny” Balwani with fraud. But he did not settle the charges and will face the agency in court.

Both Balwani and Holmes are also under criminal investigation by the US attorney’s office in San Francisco.

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