Supply chain tech firm buys US startup Finale Inventory for up to $55 million USD.
Kitchener, Waterloo-based supply chain technology firm Descartes Systems Group has bought California-based startup Finale Inventory as it navigates tariff-related headwinds.
The company said in a press release that it could pay up to $55 million USD ($75.5 million CAD) for Finale: $40 million up front and an additional $15 million if the combined business reaches specific revenue targets in each of the two years following the acquisition.
On an earnings call in June, Descartes’ CEO Edward J. Ryan noted “very challenging and uncertain market conditions” for its customers.
Finale launched in 2009 and initially helped small businesses manage their fireworks inventories. In 2014, the team founded Finale Inventory and launched e-commerce software to help a broad array of companies keep track of stock using cloud-based, multi-channel inventory management software. It has also integrated its capabilities with Canadian e-commerce giant Shopify, as well as its customers’ shipping providers and accounting systems.
In a statement, Descartes general manager of e-commerce solutions Mikel Richardson said that Finale “expands the depth” of solutions for clients to help them manage complex inventory and avoid overselling. The firm said that Finale’s tech adds to its suite of tools that manage shipping, warehousing, and order fulfillment.
BetaKit has reached out to Descartes for more details about the acquisition, including whether all Finale employees are staying on.
The deal marks Descartes’ 34th acquisition since 2016. It also acquired Sammamish, Wash.-based courier company PackageRoute in June for $2 million USD ($2.75 million CAD), and acquired Columbus, Ohio-based transport logistics platform 3Gtms in March.
Founded in 1981 and listed on the Toronto Stock Exchange since 1998, Descartes offers software solutions for use in logistics and supply chains, from ordering inventory to shipping products to customers. The company has made acquisitions of other freight, transportation, and supply chain management companies a part of its business model.
In June, Descartes reported earnings per share on a diluted basis of $0.41 USD in the first quarter, down from $0.43 USD in the previous quarter. It posted year-over-year revenue growth of 12 percent despite uncertainty stemming from US tariffs.
On an earnings call in June, Descartes’ CEO Edward J. Ryan noted “very challenging and uncertain market conditions” for its customers. Ryan said Descartes’ customers were facing lower shipment volumes, struggles to source products, and tariff-related inflationary impacts. These conditions led the company to pursue cost-saving measures that included layoffs, he said.
Descartes said in its June earnings release that it would cut its global workforce by approximately seven percent, among other cost-saving initiatives. This would amount to roughly 154 layoffs, as Descartes’ website says it has 2,200 employees. The company claimed the restructuring would cost it approximately $4 million USD in the second quarter of this year, but ultimately save $15 million USD per year. BetaKit has reached out to Descartes for more details on the layoffs.
Descartes’ share price on the Nasdaq, which closed at $103.78 USD today, has fallen eight percent since the beginning of 2025. The company is set to announce earnings for the second quarter on Sept. 3.
Feature image courtesy CHUTTERSNAP via Unsplash.