Shopify Beats Earnings Estimates, Cuts 20 Percent of Staff — Retail Bum

Shopify’s stock surged 24% in early trading after the company announced plans to cut 20% of its workforce, and its Q1 earnings beat analysts’ estimates.

The company reported $1.51 billion in revenue, higher than the $1.43 billion analysts had projected. It also posted earnings of 5 cents per share, while analysts were expecting a loss of 4 cents per share.

The latest round of layoffs marks the second time the company has cut its workforce after eliminating 10% of employees in July 2022. It remains unclear which business units will be impacted in the latest round of layoffs.

During the first round of cuts, the company said it had miscalculated how long the pandemic-led eCommerce boom would last. However, this time the company said it is cutting its workforce to focus on its core business, which offers tools to help merchants sell online.

“I recognize the crushing impact this decision has on some of you, and did not make this decision lightly,” CEO Tobi Lütke said in a memo to employees.

In line with its goal of bringing back the company’s focus to its core product offering, Shopify is divesting some of its new businesses. The company said it is selling its logistics business, which encompasses its last-mile delivery service…