SINGAPORE – Indonesian tech conglomerate GoTo Group will lay off 1,300 employees, including in Singapore, in a bid to curb costs and reach financial self-sufficiency more quickly in a persistently volatile global economic environment.
The cuts amount to 12 per cent of GoTo’s workforce, said the firm, a major ride-hailing, e-commerce and fintech player in South-east Asia, in a statement on Friday.
The company declined to disclose how many were laid off in Singapore and its latest headcount here.
GoTo had nearly 300 employees in Singapore as at April, with the bulk of them running ride-hailing and food delivery app Gojek’s operations here, according to The Business Times.
The group, formed through a merger of ride-hailing company Gojek and e-commerce firm Tokopedia in May 2021, has nearly 10,000 permanent employees as at June 30, according to its second-quarter results for 2022.
Those affected would be notified right away, added GoTo, which announced the exercise in a meeting for all employees on Friday chaired by chief executive Andre Soelistyo.
“They will be provided with a package that goes beyond what is mandatory and has been developed to not just help them financially, but also to help them with their job search,” said the company.
They will receive at least one additional month of salary beyond what is required by law, as well as payment in lieu of their notice period, it added.
Affected employees will also get to keep their laptops, access online training resources, and be added to an alumni directory shared with GoTo’s business network.
Psychological, financial and career counselling will also be provided to those who need it, until the end of May 2023, said the firm.
In a memo sent to employees and shared with The Straits Times, Mr Soelistyo wrote that inflation, geopolitical uncertainties and the pall cast by the Covid-19 pandemic – all factors beyond the firm’s control – will continue to linger.
This means the firm will need to manage its costs and make sure its business remains agile while accelerating its path to financial independence from external capital, he added.
The company went public in April with a US$1.1 billion (S$1.5 billion) stock sale, in one of the year’s biggest initial public offerings. But share prices have since slid almost 40 per cent, with flagging investor confidence in the tech sector.
GoTo said it has saved around 800 billion rupiah (S$70 million) in costs in the first half of 2022 by improving efficiency in technology, marketing and outsourcing.
But the job cuts were still needed to ensure the company is equipped to navigate challenges ahead, it added.
GoTo’s exercise is the latest in a series of cuts from tech giants such as Meta and Twitter, made amid a dimmer global outlook than expected after a Covid-19 pandemic-driven digitalisation boom.
Shares of GoTo rose 2.8 per cent on Friday after it announced the job cuts.
GoTo is set to announce its third-quarter results next Monday, hot on the heels of Friday’s layoffs, a move to narrow the firm’s losses from the 4.14 trillion rupiah adjusted loss before interest, taxes, depreciation and amortisation it reported in August for the second quarter of 2022.
GoTo will focus on its core offerings of on-demand, e-commerce and financial technology services in its accelerated push towards financial sustainability, the company added.
