23andMe laid off 100 employees due to slowing DNA kit sales

Privacy concerns likely factored into decreased demand.

23andMe, the popular DNA testing company, is laying off about 100 employees or 14 percent of its workforce as consumer demand for its kits has weakened. The company said that a variety of factors, including privacy concerns, could have contributed to the slowing market.

“This has been slow and painful for us,” CEO Anne Wojcicki told CNBC, adding that she was “surprised” by the decreased demand for the company’s DNA tests, which tell consumers about their ancestry as well as potential health issues.

Wojcicki said that “privacy is top of mind” for both consumers and the company.

Concerns about DNA test privacy have increased in recent years along with their popularity, as consumers look for ways to protect their personal information even as it becomes more readily available online.

Last month, the Pentagon warned armed forces members not to take consumer DNA tests, saying, “Exposing sensitive genetic information to outside parties poses personal and operational risks to Service members.” Earlier in December, Recode published a story about the variety of privacy issues that consumer DNA tests raise, including how law enforcement, life insurance companies, advertisers, and even international terrorists might wield the data.

The layoffs are concentrated in the consumer DNA test part of the company; employees in the company’s therapeutic drug discovery arm are not affected.

23andMe has sold over 10 million DNA kits, mostly within the US. The company was an early entrant in the consumer DNA testing space but it now has lots of competition, including from companies like Ancestry and FamilyTreeDNA. Additionally, a whole cottage industry has cropped up around DNA test results, offering specious services like pairing people with the best diet or best wine for their genes. The privacy policies surrounding these companies is also untested.