Essential Lays Off 30 Percent of Workforce

Posted on October 18, 2018 by Paul Thurrott in Android with 16 Comments

Essential Has Allegedly Only Sold 5,000 Phones

More bad news for Essential: The struggling smartphone maker has laid off about 30 percent of its workforce.

“This has been a difficult decision to make,” an Essential statement reads. “We are very sorry for the impact on our colleagues who are leaving the company and are doing everything we can to help them with their future careers. We are confident that our sharpened product focus will help us deliver a truly game-changing consumer product.”

That “sharpened product focus” bit is interesting.

When Andy Rubin’s latest venture launched its first handset, the Essential PH-1, in early 2017, it was described as the first of a suite of hardware devices that would include a smart home hub and various peripherals. But the PH-1 remains Essential’s only major release, and the firm canceled plans for a follow-up after it failed in the market, leading to questions about its future.

Recently, Essential said that it was working on a new kind of device that will come with a small screen and use voice commands as the main interaction point.

At this point, I can’t imagine Essential will ever release anything—sorry—that is particularly essential. And these new layoffs, which first reported by Bloomberg, cast further doubt on Essential’s chances for survival. According to the publication, Essential “burned through” $100 million just developing the PH-1. And the job cuts come from across the company, and impact its hardware, marketing, and sales staff.

Tagged with

Join the discussion!


Don't have a login but want to join the conversation? Become a Thurrott Premium or Basic User to participate

Comments (16)

16 responses to “Essential Lays Off 30 Percent of Workforce”

  1. harmjr

    Sad. This is the only phone I have seen be updated properly and not a year after the updates are available.

  2. Polycrastinator

    It would be interesting to know if having a better camera would have saved them. Probably not, but for a premium phone, you need a quality camera, and they failed to deliver on that one item. I was really interested in the phone when it came out but the camera was a dealbreaker for me.

    • chrisrut

      In reply to Polycrastinator:

      Right - I put one on order at announcement, but after a detailed look at what they were doing with the camera - I cancelled. The 360 degree camera was too much sizzle and too little steak.

  3. Daekar

    I never understood why people thought this company would make a big splash. They never showed off any hardware that was very special in any way.

  4. beckerrt

    It's an Apple and Samsung world (at least here in the U.S.). Not really surprised that another handset maker is coming on hard times, unfortunately.

  5. Yaggs

    The PH1 is a fantastic phone... now... it wasn't at release at the price they wanted... but right now, for $350 you would be hard pressed to find another phone with the quality build, specs, and update schedule that the PH1 has. The camera is fine now as well... and you can always download the Google camera for it. It's a shame... this company gets slammed all the time for doing what all these other companies refuse to do... they put out a quality product, sure with some issues at launch... which should be expected... and support it with updates better than ANY OTHER VENDOR out there. They were more concerned about supporting their current customers this year than pumping out another phone every 6 months like all the other vendors.

  6. skane2600

    This is what happens when you invest in "celebrity" technologists. Their "act II" almost always crashes and burns. They fail to recognize the role good fortune played in their initial success.

  7. UbelhorJ

    The Essential Phone is going to go down as one of those right product at the wrong time things.

    When it was released, the notch was weird and $700 was an insane price. Now the notch is normal with the Essential being one of the better ones, and $700 seems like a bargain for a flagship.

  8. nfeed2000t

    It is hard to sell unlocked phones in the US and make a profit. Most consumers buy their phones from the carriers. I wonder if unlocked phone seller OnePlus has ever made a profit.

    Because of poor sales, the PH-1 is currently an excellent value at $399 new or $300 used.

  9. Bats

    Like I said in a previous post some time ago......I am not surprised. It's not that the smartphone is bad, but it has zero brand name recognition. Right now, when it comes to smartphones there are only two brands people recognize: Samsung and Apple. 

    Regular people don't recognize or know the brand or the company, Essential. To them, the brand Essential is in the same class as Insigna, Dynex, or Rocketfish. Even though, the average tech enthusiast would know better, the average person in the world doesn't. The fault for that lies with whoever is running the company.

  10. waethorn

    "We are very sorry for the impact on our colleagues who are leaving the company and are doing everything we can to help them with their future careers. We are confident that our sharpened product focus will help us deliver a truly game-changing consumer product."

    They already have a "sharpened product focus" - they make *ONE* phone.

    And it wasn't a game-changer either. They should just close up shop.

  11. HellcatM

    Its just to difficult to get into the handset market, any new company will most likely fail. HTC, LG and other companies that make handsets for the US aren't doing that well. They can't compete with Samsung in the Android space. HTC isn't making phones anymore (or hasn't in a while) and LG makes other products so they can keep trying to make phones even if its at a loss. Google is making phones still probably for the same reason, also they're the only ones that you can get proper upgrades. One Plus does ok but you can't buy them through carriers where people who can't afford a $1000 phone can pay it off in installments. Maybe if they were in Verizon or AT&T they'd do better?

    I guess the people at Essential thought they can make it since Andy Rubin was the co-founder of Android inc, maybe he thought his name would have some pull in the community?

    In other countries other phone manufacturers have a strong hold.

    If a company can come out with a truly unique device, that can turn peoples heads, then maybe another company can get a foot hold in the market.

  12. scotttech1

    Those employees were...

    ( ••)

    ( ••)>⌐■-■

    not essential