Shutterfly plans to lay off nearly 100 workers in Shakopee in downsizing

Digital photo company Shutterfly plans to lay off 97 workers at its Shakopee warehouse as part of a companywide effort to reduce costs.

In a letter to the Minnesota Department of Employment and Economic Development this week, Shutterfly legal director Lisa Bale said the company plans to transfer its photo books production and gifting operations from Shakopee to other facilities and eliminate certain positions that support Shutterfly operations.

The layoffs are anticipated to take place March 29-31. They are expected to be permanent, although the Shakopee facility is not closing, Bale said.

Shutterfly has its headquarters in Redwood City, Calif., with sizeable business operations based in Eden Prairie.

"In light of challenging and uncertain economic conditions, we conducted a thorough review of our cost and organizational structure resulting in a workforce reduction of approximately 360 roles," Shutterfly said in a statement.

"This was a difficult decision made with great care, and we are grateful for the many lasting contributions these colleagues have made."

Shutterfly's financial performance has been under wraps since the private equity firm Apollo Global Management bought the company for $1.74 billion in 2019. Shutterfly CEO Hilary Schneider recently told the Associated Press that businesses are facing "a choppy environment" because of macroeconomic issues, including high inflation, supply chain concerns and high labor costs.

After many tech companies saw a boom in demand during the pandemic, consumers have begun to pull back on discretionary spending, leading companies such as online retailer Amazon and furniture seller Wayfair to recently announce layoffs.

The Associated Press contributed to this report.