Shopify to Cut 20% of Workforce and Sell Logistics Division Deliverr to Flexport
- ByStartupStory | May 4, 2023
Shopify, a Canadian ecommerce company, will undergo its second round of layoffs within a year, resulting in a 20% reduction of its workforce. In addition, Shopify plans to sell its logistics division, Deliverr, to end-to-end trading platform Flexport. Despite the layoffs, Shopify reported impressive first quarter 2023 results, with a 25% increase in total revenues to $1.5 billion. The positive news resulted in a surge of up to 17% in the company’s stock during pre-market trading.
Flexport will acquire Deliverr’s fulfilment business, which Deliverr purchased for $2.1 billion less than a year ago. As part of the deal, Deliverr will receive a 13% equity stake in Flexport. The CEO of Deliverr, Harsh Abbott, will oversee the transition, subject to regulatory approval. Meanwhile, Sumit Shah, the CEO of Wow Skin Science, a prominent seller on Shopify India, announced on Twitter that the company has transferred its entire online store to the platform of Dukaan.
One of the investors in Flexport is Shopify, which earlier this year teamed up with the logistics company to offer its merchants access to Flexport’s freight services.
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