BigCommerce Holdings, Inc. (Nasdaq: BIGC), a leading Open SaaS ecommerce platform for fast-growing and established B2C and B2B brands, has announced its plan to reduce its cost structure and accelerate its path to profitability. The planned restructuring aims to move forward its adjusted EBITDA breakeven timeline from mid to late 2024 to the fourth quarter of 2023.
BigCommerce will prioritize its strategic focus, investments and resources to build upon its expanding leadership position in enterprise ecommerce. Already recognized as a leader in composable commerce and omnichannel selling with a full-featured enterprise B2C and B2B offering, BigCommerce will focus its go-to-market efforts on the enterprise business, where it sees the strongest unit economics and the opportunity for long-term, profitable growth. As part of this restructuring plan, BigCommerce will reduce its sales and marketing expenditures in non-enterprise initiatives and its total workforce by approximately 13% across employees and contractors.
“This focusing of our spending and resources, which impacts all of our teammates, was an incredibly difficult decision to make. We are implementing changes that will enhance the strength of our financial profile against the backdrop of a challenging economic environment. It will also drive focus on the areas we view as having the strongest product market advantage and best long-term financial performance,” said Brent Bellm, CEO of BigCommerce. “We are sadly parting ways with some incredibly talented people whom we have grown to cherish as friends and colleagues over the years. We will do our best to support them through the transition to find their next opportunities.”
BigCommerce expects the workforce changes to be largely complete by December 31, 2022. The company estimates the aggregate costs associated with the reduction in force to be approximately $4.2 million to $4.6 million, primarily consisting of severance payments, employee benefits and related costs, and expects to incur these charges in the fourth quarter of 2022. In conjunction with the reduction in force, BigCommerce is also evaluating its facilities footprint and its continued need for existing space for potential impairment of the right-of-use assets associated with its headquarter facilities. The company estimates the aggregate cost of an impairment will range between $2.0 million and $3.2 million.
In addition, BigCommerce is reiterating its financial guidance, as outlined in the its third quarter earnings release issued on November 3, 2022, for both the fourth quarter and the full year 2022, for total revenue and non-GAAP operating loss, excluding any estimated impact of costs incurred in connection with the payment of post-employment benefits to impacted employees and other related restructuring costs BigCommerce may recognize in the fourth quarter of 2022. BigCommerce will provide detailed revenue and non-GAAP operating loss guidance on its February 2023 earnings call.
