Flexport, the tech-focused freight forwarder that launched more than a decade ago, is extending its timeline to reach profitability.
Ryan Petersen, the privately held company’s founder and chief executive, says Flexport missed its target of profitability at the end of 2024 largely because of weaker-than-expected demand for its e-commerce fulfillment and distribution services.
“We came up short,” Petersen said in an interview.
Petersen said too much of the company’s 5.2 million square feet of warehouse space, spread across five buildings, went unfilled last year. He said demand for fulfillment services is rebounding and that he expects Flexport will be “quite profitable” by the end of 2025.
The San Francisco company’s core business is as a freight middleman. It buys space on ships, planes and trucks, and makes money on the spread between its costs and the rates it charges customers. Petersen told The Wall Street Journal in 2023 that Flexport would reach profitability by late 2024 on its way toward a potential initial public offering.
Petersen still aims to take Flexport public. But he also is considering a secondary tender offering, which would allow some of the investors who have plowed a total $2.3 billion into the company since its founding in 2013 to cash out while keeping Flexport private. The company reached an $8 billion valuation following its most recent funding round in 2022.