An employee works at Shopify’s head office in Ottawa, Ontario, Canada, October 22, 2018. REUTERS/Chris Wattie/File Photo

July 26 (Reuters) – Canada’s Shopify Inc (SHOP.TO) is laying off 10% of its workforce, the e-commerce company said on Tuesday, as it struggles with sales growth due to a post- online shopping pandemic.

U.S.-listed shares fell 14.7% to $31.29 after the company said it witnessed a pullback in online orders.

Shopify had hit the jackpot during the COVID-19 shutdowns as merchants turned to its platform to build online stores. As a result, the company increased its investments in its workforce and technology, betting that the boom would not subside.

However, Chief Executive Tobi Lütke, in a letter to employees, said consumers are now returning to shop at physical retail stores and online shopping trends have returned to where they were before the start of the pandemic.

“It’s now clear that the gamble didn’t pay off… In the end, placing (this) was my call to make and I was wrong.”

Lütke added that the relevant roles are recruiting, sales and support.

With the economy reopening, the company has lost its prominence as Canada’s most valuable company and its shares have lost nearly three-quarters of their value so far this year.

The company has partnered with social media companies Twitter (TWTR.N) and YouTube as influencers who have become popular online are starting to sell their own brands to offset slowing sales.

Reporting by Chavi Mehta in Bengaluru; Editing by Shailesh Kuber

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