Employees work at Shopify’s headquarters in Ottawa, Ontario, Canada.
Chris Watty | Reuters
Shopify announced Thursday that it will cut 20% of its workforce.the news came as it was reported Earnings in the first quarter It beat analyst estimates on both revenue and earnings.
Shopify’s stock price rose more than 26% in early trading.
CEO Tobi Lütke announced There is a job cut in a memo to employees posted on the company website. He did not specify which units would be affected as a result of the layoffs.
“We are aware of the devastating impact this decision will have on some people, and we do not take this decision lightly,” Lütke wrote.
Shopify said it had about 11,600 employees and contractors as of Dec. 31. securities report.
The job cuts will be the second job cuts for the Canadian e-commerce company. Last July, Shopify laid off 10% of its workforce. Lütke said the company misjudged how long the e-commerce boom fueled by the coronavirus pandemic would last.
Lütke said Shopify is slimming down as a company to focus on its core business of creating tools for businesses to sell their products online. The company separately announced on Thursday that it will offload its logistics division to his Flexport. The sale includes He Deliverr, the last-mile delivery company he acquired for $2.1 billion last May.
Shopify We also sell It has sold warehouse robot maker 6 River Systems, which it acquired for $450 million in 2019, to British retail tech company Ocado. Terms of the deal between Flexport and Ocado were not disclosed.
The move marks the end of Shopify’s years of efforts to build its own logistics business. Lütke called the effort a “worthy sideline” that could become an independent company in the future, but Shopify has refocused its efforts on e-commerce, his software, and new initiatives such as artificial intelligence. I said that I have placed
“Shopify has the privilege of being one of the companies most likely to use AI to help their customers,” said Lütke.
Shopify also beat Wall Street estimates in the first quarter. According to Refinitiv, the company’s revenue was $1.51 billion, up 25% from a year earlier, beating Wall Street’s forecast of $1.43 billion.
Earnings of 5 cents per share. Excluding items, Shopify earns 1 cent per share of his Analysts had expected a loss of 4 cents per share. In the same period last year, Shopify reported a net loss of $1.5 billion ($1.17 per share) a year ago.
Clarification: This story has been updated to clarify that Shopify earned 1 cent per share, excluding items. Analysts had expected a loss of 4 cents per share.