In a move designed to “improve operating performance,” Leafly said in a regulatory filing that its cost-cutting restructuring plan would trim the workforce through a combination of layoffs and attrition.
The company expects a one-time cash restructuring charge for the layoffs of approximately $500,000 in Q4 of 2022.
“These reductions will help preserve our ability to respond to opportunities as this industry continues to mature and expand, and allow us to more effectively manage our capital,” Leafly CEO Yoko Miyashita said in a statement. “In addition to cutting costs, we have taken a close look at our structure to ensure we are prioritizing the most meaningful parts of the business.”
Founded in 2010, Leafly’s online marketplace lets customers shop and select cannabis products from licensed retailers. The startup also serves as an educational resource. Its revenue primarily comes from a monthly subscription fee paid by cannabis retailers to be listed on the platform and to access e-commerce tools.
However, average monthly active users fell 28% to 7.9 million compared to the year-ago period, and total retail accounts fell 3% from the first quarter. Leafly cited challenges in less mature markets and “signs that customers are more cautious with their ad budgets.” It lowered full-year revenue expectations.
Earlier this week, Leafly announced that it was partnering with Uber to deliver cannabis in Toronto. It’s the first time cannabis delivery is available on a major third-party delivery platform.