SpaceX would lay off 10 per cent of its roughly 6,000-person workforce as the US-based private spaceflight company attempts to get two expensive projects off the ground.
"To continue delivering for our customers and to succeed in developing interplanetary spacecraft and a global space-based Internet, SpaceX must become a leaner company," the Elon Musk-led company was quoted as saying in a statement on Friday by CNN.
"This action is taken only due to the extraordinarily difficult challenges ahead and would not otherwise be necessary," the statement added.
SpaceX has a booming business but its plans are very ambitious. While it has a contract with NASA to deliver cargo to the International Space Station (ISS), the company is now planning to start flying astronauts to the ISS for NASA sometime this year.
In September, Musk estimated SpaceX would spend between $2 billion and $10 billion developing an ultra-powerful spaceship and rocket system, recently renamed Starship and Super Heavy.
SpaceX also plans to use the technology to fly tourists to space and, potentially, one day send humans to Mars, CNN said.
Musk on Thursday offered a glimpse of the company's Starship test flight rocket, dubbed the "Hopper".
SpaceX will conduct a "hopper test" of its Mars spaceship prototype as early as next month, according to Musk, The Los Angeles Times reported.
The company is also developing a constellation of satellites that could one day beam high-speed Internet down to the Earth.
SpaceX was recently valued at $30.5 billion after initiating a $500 million equity sale in December. The company also took on about $250 million in debt last year in its first loan sale, according to the Wall Street Journal.
But SpaceX's new products are expected to cost billions of dollars to develop.