Less than 2 years after acquiring RE2 Robotics, Sarcos is closing down its Pittsburgh office to focus on AI

In 2022, Lawrenceville’s RE2 Robotics announced it would be going public via an $100 million acquisition by Salt Lake City-based Sarcos Technology and Robotics Corporation. The move marked a significant growth milestone for RE2, which specialized in the development of intelligent mobile manipulation systems, and was founded in 2001 by Jorgen Pedersen as a spinout from Carnegie Mellon University’s National Robotics Engineering Center.

But this week, Sarcos announced it would be laying off 150 employees and suspending its commercialization efforts concerning subsea, aviation and solar robotics hardware programs to focus on artificial intelligence software. According to the announcement, the company’s leadership sees a larger opportunity in developing the robotic AI and machine learning platform, which is slated to launch by mid-2024.

“We believe that our AI software platform will enable, for the majority of the industrial robots being sold around the world, a dramatic reduction in robotic training times while also making industrial robots far more agile,” Sarcos CEO and President Laura Peterson said in a written statement. “… With the large number of robotic systems throughout the world and a product that we believe is unlike anything else currently available, we see a broad addressable market and an opportunity to build a robust software business that is scalable at a substantially faster rate than our hardware solutions.”

Despite devoting much of the past two years to bringing the Sarcos and RE2 teams together post-acquisition, Sarcos’ Pittsburgh office will close and consolidate to focus on operations in Salt Lake City.

The company is employing job placement services for affected employees, who will receive 60 days’ notice of termination, a Sarcos spokesperson told Technical.ly. (The Worker Adjustment and Retraining Notification Act, aka WARN Act, legally requires companies with 100 or more employees to provide them with a 60-day notification of a layoff of 50 or more employees that make up at least 33% of the company’s workforce.)

The spokesperson said the company could not release full details about the transition, and did not answer Technical.ly’s questions about whether laid-off employees would receive a severance package; if any of the employees from the Pittsburgh site would relocate to Salt Lake City; and how many of the laid-off employees are based in Pittsburgh.

However, some time after this story first published, RE2, LLC/Sarcos Corp. filed a WARN notice with the Pennsylvania Department of Labor & Industry indicating that 73 workers would be affected by the closure at 4925 Harrison St., effective Jan. 16, 2024.

Jorgen Pedersen at Sarcos’ office, holding one of RE2’s earliest robotic arms, in January 2023. (Technical.ly/Atiya Irvin-Mitchell)

“While it is always a difficult decision to make staffing cuts, especially one this significant, it is important that Sarcos is resourced appropriately and that we are good stewards of our capital,” Peterson said in the company announcement. “We believe the prioritization of our AI software platform meets our previously announced goal of pursuing significant near-term revenue tied to acute customer needs, reduces our capital requirements and related risks in line with available resources, and will lead to long-term stockholder value creation.”

In January 2023, RE2 founder Pedersen — who later stepped down from his role as Sarcos’ COO, in July — told Technical.ly that over the years, the company saw its biggest customer go from being Carnegie Mellon University to the Department of Defense, and earned millions in contracts from the US Navy. Throughout, robotics remained at the core of RE2’s DNA. The two companies’ merger worked because of their shared vision, Pedersen said while reflecting on the acquisition a year out.

“We had complementary technologies,” the founder said. “They had more anthropomorphic technologies and exoskeletons, we had more mobile manipulation technologies. So when the worlds came together, it was just a nice dovetail of capabilities, which was not only additive, it multiplied our capability.”

Pedersen also recalled then that from 2020 to early 2023, the RE2 staff in Pittsburgh doubled from 50 to 100. During that time, the company expanded to two new buildings in the neighborhood.

Pedersen declined to comment on the Sarcos layoffs this week.

Moving forward, Sarcos’s leadership said the company needs to ensure its financial future, and the best way to do that is through its AI software.

“By de-coupling our AI and ML software from our own robotic systems, we believe we can reach a much broader market more quickly,” Peterson said. “We believe this is the right decision for both the short-term and long-term health of and opportunities for the business. We can run a leaner business that is more efficient, reduce our cash usage and put ourselves in a stronger position to reach profitability without the need to raise additional financing.”