in singapore biggest round of layoffs since pandemic
The largest round of layoffs since Grab Holdings Ltd. is planning the pandemic as the internet company prepares for fiercer competition in Southeast Asia’s ride-hailing and food delivery markets.
The layoffs are expected to surpass a 2020 round that reduced staff by 5%, or about 360 employees, according to people familiar with the situation, and they could be announced as early as this week. The precise figure is up for debate and subject to change as circumstances evolve.
Although Singapore-based Grab dominates the Southeast Asian delivery and ride-hailing industries, it hasn’t yet achieved profitability due to spending on expansion and price pressure from rivals like Indonesia’s GoTo Group. Even though Grab has cut losses and promised to report a profit on an adjusted basis by the fourth quarter of this year, its shares have dropped by about 70% since making its New York stock market debut in late 2021.
The reductions imply that Grab is caving into investor pressure for more rapid cost-cutting. Grab has yet to cut costs as quickly as its rivals in the region. Grab avoided mass layoffs last year while GoTo and Singapore’s Sea Ltd. cut thousands of jobs. In 2022, it hired more than 3,000 new employees, primarily as a result of its acquisition of the supermarket chain Jaya Grocer, bringing its overall headcount above 11,000 people.
A Grab representative declined to respond, Singapore
Additionally, as customers struggle with higher inflation and rising interest rates, Grab may see its growth slow down. The company said its gross merchandise value increased just 3% in the three months leading up to March, despite reporting a narrower quarterly loss last month. This is a decrease from 24% for the entire year 2022. As rivals enticed customers with promotions and lower prices, user growth also slowed.
In the first quarter, Grab’s adjusted losses before interest, taxes, depreciation, and amortization decreased to $66 million, and analysts anticipate that this trend will continue. In terms of net income, it is further from being profitable. Its net loss decreased in the first quarter from $423 million to $244 million.