The Company Restructures Teams to Support Rapid Growth in Energy Storage Business

Redwood Materials has laid off approximately 135 employees, representing about 10% of its workforce, as part of a restructuring effort to better align with its growing energy storage business.

The layoffs come just five months after the company reduced its workforce by 5% and three months after securing a $425 million funding round that valued the battery recycling company at over $6 billion.

According to an internal email viewed by TechCrunch, Redwood Materials founder and CEO JB Straubel informed employees that the restructuring is not a sign of decline but rather a strategic move to support areas of the business experiencing strong momentum.

Redwood today is the strongest it’s ever been.

JB Straubel, CEO of Redwood Materials

Straubel emphasized that the company’s core materials business remains on track for profitability and continues to have an exciting roadmap ahead, while also maintaining its position as a dominant player in the U.S. Battery recycling market.

He noted that recent growth in certain parts of the organization had outpaced the needs of the company’s evolving strategic direction, particularly in engineering and manufacturing teams, which prompted the need for adjustments in staffing levels.

The restructuring reflects broader challenges in the battery industry, including the recent Chapter 11 bankruptcy filing by fellow recycler Ascend Elements, which cited “insurmountable” financial difficulties. Other battery manufacturers have also undergone restructuring or ceased operations as automakers scale back aggressive electric vehicle adoption plans.

Despite these headwinds, Redwood Materials has continued to advance its energy storage initiatives, recently announcing partnerships with companies such as Crusoe AI and electric vehicle manufacturer Rivian to supply recycled batteries for powering their operations.

The company declined to provide further comment beyond the contents of Straubel’s internal email, which framed the layoffs as a necessary step to sharpen focus and improve operational efficiency in support of long-term growth.