According to the Wall Street Journal, US freight forwarder Flexport is preparing to lay off 20% of its workforce, affecting approximately 500 people.
This will be the second major round of layoffs in a few months, as Flexport laid off a fifth of its employees back in October.
Flexport has been particularly challenged by the declining freight rates, which has resulted in large financial losses. However, in early January, the carrier announced that Shopify, an e-commerce provider, had invested USD 260m in the carrier.
Flexport was founded in 2013 by Ryan Petersen, who suddenly returned to the company in early September, replacing Flexport’s former chief executive Dave Clark.
It has been reported that Ryan Petersen replaced Dave Clark, a former high-ranking executive, after the two had a falling out over the company’s direction and spending on new activities
At the end of 2023, the founder said he expects Flexport to be profitable again by early 2025.
”We have a plan to make us profitable towards the end of next year or throughout 2025. That’s what we’re working on, and it doesn’t require miracles, just good execution,” Petersen said.
The company acts as a middleman, buying space on container ships from shipping lines and making money from the difference between the shipping lines’ list prices and the rates they charge customers.
Over the past 10 years, Flexport has raised USD 2.3bn in investments, and in connection with a capital raising in February, the forwarder was valued at USD 8bn.
(Translated using DeepL with additional editing by Catherine Brett)
