Shopify cuts workforce 10% on 'bet that didn't pay off'; Shares sink
BNN Bloomberg
Shopify shares tumbled Tuesday as the Canadian tech giant revealed a significant round of layoffs as the pandemic e-commerce boom fades.
“I think this is a sign of the company observing some headwinds in their business and choosing to go on a more disciplined growth and profitability path,” said Tyler Radke, a director at Citi Research, in an interview.
Just prior to the layoff announcement, Radke trimmed his price target on Shopify’s New York-listed shares to US$37.00 apiece from US$43.20 amid concerns about what he called “a challenging demand backdrop.”
“This company was growing close to triple digits in some quarters. And, you know, I think as investors we’re oftentimes guilty of extrapolating past trends into the future,” he said in the interview.
