Grab cuts 1,000 jobs, which is 11% of workforce
Grab reported a quarterly loss of US$250 million but said revenue in the first quarter of this year rose 130.3 per cent from a year ago.
PHOTO: The Straits Times
PUBLISHED ONJune 20, 2023 2:35 PM
SINGAPORE - Singapore-based Grab Holdings, South-east Asia’s leading ride-hailing and food delivery app, is cutting 1,000 jobs or 11 per cent of its workforce, its chief executive officer said on Tuesday, citing the need to manage costs and ensure more affordable services long-term.
In a letter sent to employees late on Tuesday and seen by Reuters, Mr Anthony Tan said the cuts, the biggest since the start of the pandemic, were not “a shortcut to profitability” but a strategic reorganisation to adapt to the business environment.
“Change has never been this fast. Technology such as generative AI (artificial intelligence) is evolving at breakneck speed. The cost of capital has gone up, directly impacting the competitive landscape,” he said in the letter.
“We must combine our scale with nimble execution and cost leadership, so that we can sustainably offer even more affordable services and deepen our penetration of the masses.”
Mr Tan said that even without layoffs, Grab had managed costs and should hit its target for group-adjusted earnings before interest, taxes, depreciation and amortisation break-even in 2023.
The “super app”, founded in 2012, offers deliveries, rides and financial services in eight South-east Asian countries, including Indonesia, Malaysia, the Philippines, Thailand and Vietnam.
Its shares were up 4.7 per cent pre-market after Mr Tan’s announcement to staff. The stock had climbed as much as 5.6 per cent pre-market, extending earlier gains on a Bloomberg News report of the cuts.
In May, Grab reported a quarterly loss of US$250 million (S$336 million), but said revenue in the first quarter of 2023 rose 130.3 per cent to US$525 million from a year ago.
In February, it issued an upbeat forecast for full-year revenue for 2023 and brought forward its profitability timeline.
The US-listed Grab’s last job cuts were in 2020, when 360 people were laid off in response to the impact of the pandemic. The company had 11,934 staff as at the end of 2022, including about 2,000 from its acquisition of a grocery chain that year, its latest annual report said.
In September last year, it said it had no plans to undertake mass layoffs despite the weak market.
In December, Mr Tan told staff that the company was freezing most hiring and pay rises for senior managers, as well as cutting travel and expense budgets.
Source: Reuters
