ELD and fleet management solutions provider Samsara announced Wednesday it was laying off 300 employees, 18% of its workforce, as the company responds to the coronavirus downturn.
“It’s now clear that COVID-19 has become the most significant economic event in the past 100 years,” CEO Sanjit Biswas said in a blog post, and “since the outbreak, we’ve had to plan for scenarios that were unimaginable just a few months ago.”
Geographic areas impacted by the layoffs focused on Italy, Spain and Benelux, as these regions have “the longest paths to profitability,” spokesperson Lindsay McKinley told FreightWaves.
Samsara will continue to invest in the U.K., France and the DACH region, but with a focus on cash efficiency, she said.
Other layoffs took place in Samsara’s recruiting and events division, as large, in-person events are unlikely to resume for the foreseeable future.
The company said workers impacted by the layoffs will receive severance pay, coaching and outplacement services, as well as health care coverage for the rest of the year.
Also on Wednesday, Samsara announced a $400 million equity financing raise. The funding will help the company operate sustainably “even under worst case economic conditions,” according to McKinley.
Samsara claims 15,000 customers across a variety of industries and geographic markets. Its offerings include hardware, software and cloud aimed at bringing real-time visibility, analytics and AI to trucking operations.
But freight volumes are still mostly far from a rebound. And truck manufacturers are reporting record lows for new sales, meaning fleets are not expanding this year.
Although Samsara expects to see continued revenue and customer growth, McKinley said, sales will likely take longer to close “as businesses operate cautiously.”
The layoffs come less than two months after competitor KeepTruckin laid off 18% of its workforce. Both companies reportedly focused on smaller operators but had also started to pull market share from legacy providers such as Trimble (TRMB) and Omnitracs.
With the new funding, Samsara now has approximately $600 million of cash on hand. Investors included Alliance Bernstein, Franklin Templeton, General Atlantic, Sands Capital Management and Warburg Pincus, along with previous investors Andreessen Horowitz, Dragoneer Investment Group, General Catalyst and Tiger.
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Curt
Buy market share, then sell the company. That is the end game for Samsara. Their problems have only just begun.
Will
That statement is full of bullshit … Samsara told it’s sales rep that their quota wouldn’t be lowered because the industries they were selling Into weren’t impacted « business as usual » and used it to fire sales rep 20 days before laying off the rest of the company.
Bill
They did lower quotas….
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PEguy
I hear they are losing $40M per month. This $600M won’t last them very long. How is Lytx, with way more revenue and profitable, valued at $2B and these guys at $5B??
Dave
PE guy: Yup. Profits still count in business. When the money well runs dry or the money is all burned up the only solution is to cut costs. We’ll see a lot more of this, unfortunately.
Arf
@PEGuy Lytx has one product, Cameras. They’ve recently upgraded their product but 90% of Lynx existing customers currently have inferior Cameras based on what’s available on the market.
Do you think Lytx sold more new cameras than Samsara in 2019? In 2020? Cameras are 1 of multiple products Samsara offers.
Lytx is a good company, but it’s not crazy to imagine why Samsara has a higher valuation.
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