ChargePoint Holdings Inc.’s stock dropped on Thursday after the company said it will cut 12% of its workforce in a move to cut costs by about $33 million a year.
ChargePoint
CHPT,
did not disclose the number of employees it was letting go. It said in its annual report that it had more than 1,650 employees as of Jan. 31, 2023. Based on that figure, the layoffs would affect about 198 people.
The company did not immediately reply to an email from MarketWatch.
ChargePoint’s stock was down 3.4% on Thursday.
The move comes as electric-vehicle adoption runs below expectations because of higher prices for the cars, as cited by Ford Motor Co.
F,
and others.
ChargePoint Chief Executive Rick Wilmer said the job-cut decision was “difficult” after a business evaluation following his promotion to the job in November, according to a statement.
He previously worked as operating chief at the electric-vehicle charging station provider and joined the company in 2022.
“We are heightening our focus on execution, operational excellence, and improved efficiencies,” Wilmer said.
The company said it’ll take $14 million in restructuring charges as part of the job cuts. Most of those expenses will be recognized in the company’s fourth-quarter results due out in March.
ChargePoint said it had $397 million in cash, cash equivalents and restricted cash on its balance sheet at the end of the third quarter.
It also has access to an additional $150 million on an undrawn revolving credit facility.
ChargePoint’s stock has fallen by 19.8% in the past year, compared to a 35.2% gain by the Nasdaq
COMP.
The company went public in 2021 through a reverse merger with a special purpose acquisition company called Switchback Energy Acquisition Corp. in a stock debut it described as the world’s first publicly-traded global EV charging network.
Also read: Hertz cites weak demand, high damage costs in decision to downsize EV fleet
