Blue Apron Holdings Inc will cut about 10% of its corporate workforce, the online meal kit company said, the latest US firm reining in costs against the backdrop of rising expectations of an economic downturn.
Shares of the company, which is facing uncertainties around funding, rose as much as 12.5% at open on Thursday after it also identified up to about $50 million in cost cuts for 2023. They later pared some gains to trade 5% higher.
US companies ranging from top banks and tech majors to finance startups have announced job cuts in recent months, as Corporate America braces for a looming recession.
New York-based Blue Apron, which had about 1,657 full-time employees as of 30 September, said it expects to incur about $1.2 million in related expenses, primarily severance payments, in the fourth quarter of 2022.
Blue Apron in November withdrew its full-year revenue growth forecast, citing uncertainty around an expected funding from affiliates of longtime investor Joseph Sanberg.
It missed third-quarter revenue estimates as both the number of customers and orders dipped.
In October 2020, the meal-kit delivery company's board concluded a review of its strategic options, after raising cash and seeing an improvement in its business during the COVID-19 pandemic.
Elsewhere, HelloFresh reported a 10% drop in third-quarter AEBITDA to €71.8 million ($72.3 million), below an average of €75.6 million estimated by analysts in a company-provided poll.
The German meal-kit maker warned that full-year results would be in the lower half of expectations as it spends more on advertising to retain customers amid consumer concerns about higher food and energy bills.