The company earns tens of millions of dollars per launch.
About 600 of the firm's 6,000-strong workforce are being laid off, with the company blaming "extraordinary hard challenges ahead" for its decision. "Either of these developments, even when attempted separately, have bankrupted other organisations", a spokesman said in an email, reported Reuters.
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 statement continued. A crewed Dragon spacecraft is scheduled to send USA astronauts to the ISS later this year.
In October, Elon Musk reportedly at least seven people from senior management at the SpaceX facilities in Redmond, Washington, as he was not satisfied with the speed of developing and testing Starlink satellites. The first unpiloted test flight of the vehicle is planned as early as February, with the piloted mission planned for sometime in the summer.
The company is also heavily investing in several different research and development programs.
Elon Musk has revealed images of his fully-assembled 120-foot tall Starship hopper test rocket.
Word of the reductions came just hours after SpaceX executed its first Falcon 9 rocket launch of the year, putting 10 Iridium NEXT satellites into low Earth orbit, and a day after Musk hailed the assembly of a subscale test prototype for SpaceX's interplanetary Starship spacecraft.
And The Wall Street Journal reported last month that the company was raising USD500 million from investors to help launch its satellite internet service. In addition, SpaceX plans its first deployment of its Starlink satellites this year, which will be the key infrastructure for its space-based Internet project.
Previously, the private space company said that it has been profitable for years, thanks to the lucrative contracts that it struck from clients that include the US Air Force and NASA.