Shopify to shrink workforce by 23% through layoffs, sale of logistics business – National | Globalnews.ca

Canada’s Shopify Inc. says it will reduce its head count by about 23 per cent and sell its logistics business to Flexport, a supply chain management company.

The Ottawa-based e-commerce company positioned the moves as a way to help it focus on its main quest to make commerce easier.

Shopify said in corporate filings Thursday that it would reduce its overall headcount by roughly 23 per cent through layoffs and the sale of its logistics business.

In an open letter, chief executive Tobi Lutke did not quantify how many staff would be departing the company, but before Shopify laid off about 1,000 staff last summer it had roughly 10,000 employees.

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Lutke says the company has also decided to sell Shopify Logistics to Flexport to help the business become more ambitious and global in nature.

Under the terms of the agreement, Shopify will receive stock representing a 13 per cent stake in Flexport and the ability to name a director to Flexport’s board.

The company also beat Wall Street estimates for first-quarter revenue, sending its U.S.-listed shares up 8% in trading before the bell.

The company posted revenue of $1.51 billion in the quarter ended March 31, compared with analysts’ estimate of $1.43 billion, according to Refinitiv data.

— With files from Global News’ Craig Lord, Reuters