Shares of Werewolf Therapeutics Inc. (NASDAQ:HOWL) declined 5.1% in after-hours trading on Friday after the company announced a significant reduction in headcount, impacting 64% of its employees.
The company said the board of directors approved the workforce reduction on February 9, 2026, and that the layoffs are expected to be substantially completed by February 13. Werewolf described the action as a measure intended to lower operating costs.
Werewolf further stated it expects to record a one-time charge of approximately $4.1 million in the first quarter of 2026 related to employee separation benefits, which include severance and associated costs. The firm noted that those expenses will also generate cash outflows during the same quarter.
As part of the restructuring, Chief Financial Officer Timothy W. Trost and Chief Medical Officer Dr. Randi Isaacs will resign effective February 13, 2026. The company said both departing executives will receive severance packages equal to nine months of base salary and continuation of health care benefits. In addition, each will move into a consulting role billed at $250 per hour for up to six months to facilitate an orderly transition.
In connection with the leadership changes, Michael Urban, the company’s current Vice President of Finance and Corporate Controller, will assume the responsibilities of principal financial officer and principal accounting officer, effective February 13.
Werewolf also disclosed that it had pursued capital-raising efforts in late 2025 and early 2026, holding confidential discussions with prospective investors to support planned operations. The company said it is "evaluating alternatives with respect to maximizing both near and long-term value for its stockholders," and that those alternatives include exploring strategic partnerships for its INDUKINE programs, WTX-124 and WTX-330.
The company did not provide additional financial projections or details on the number of employees encompassed by the reduction beyond the 64% figure. Nor did it provide specifics on potential partners or timing for any strategic transactions. The disclosure framed the personnel changes and one-time charge as immediate actions tied to cost reduction and operational adjustment.
Investors reacting to the announcement pushed the stock lower in after-hours trade on the day the company made the disclosure; the drop amounted to 5.1% from the prior close.