CafePress Inc (NASDAQ:PRSS) has laid off 12 employees in Louisville, KY. The layoffs came from various departments. CEO Fred Durham blamed the layoffs, in part, on changes to Google’s search engine algorithm, which began in the second quarter of 2017.
Durham said that in addition to changes in Google’s algorithm (which undoubtedly affected the online retailer’s visibility and ranking), increased shipping costs and costs to update the company’s web site all helped derail the company.
In November, CafePress announced that its third-quarter revenue for the period, ended September 30, fell 22% year-over-year to $15.35 million. Revenue from CafePress.com, was down 32% year-over-year at $10.9 million. The company’s third-quarter net loss increased slightly to $3.6 million, or $0.22 per share, from $3.4 million, or $0.20 per share in the same prior-year period.
Year-to-date revenue was down 12% at $51.5 million. Revenue from CafePress.com fell 21% to $38.34 million. The company’s year-to-date net loss narrowed to $10.1 million, or $0.61 per share from $29.3 million, or $1.76 per share.
At the time, Durham said, “We continue to make progress on our multi-year turnaround strategy, specifically focusing on completing the modernization of the CafePress.com website in the third quarter as we prepare to demolish the old site. These efforts are critical as we continue to optimize the business and enhance our technology to re-energize our customer experience and ultimately return to profitable growth.”
This is not the first time CafePress has announced layoffs due to strategic changes. In December 2016, the Louisville, KY-based e-commerce company laid off around 10 employees. The company said the layoffs were a result of strategic changes and the re-aligning of certain departments.
CafePress has not yet announced its fourth-quarter results, but the holiday season is the best time of year for the quirky, online gift shop. Whether the company’s turnaround plan, which was first announced in 2014, is on track or if outside issues continue to plague it remains to be seen. If issues do persist, it’s quite possible that CafePress could announce additional layoffs in 2018.
Investors are hopeful that CafePress’ turnaround plan is working. The company’s share price has lost more than 35% of its value since the start of 2017 and is currently changing hands at $1.90.
“CafePress cutting jobs in Louisville,” Louisville Business First, January 9, 2018.
“CafePress Reports Results for Third Quarter 2017,” Café Press Inc., November 2, 2017.
“Louisville-based CafePress confirms layoffs due to ‘strategic’ changes,” Inside Louisville, December 12, 2016.