Singapore-based tech giant Grab will lay off over 1,000 employees, its CEO said Tuesday, a move that will affect about 11 percent of its workforce.
Grab launched in 2012 as a taxi-booking app in Malaysia before becoming Southeast Asia’s biggest ride-hailing firm and expanding into financial services like digital payments.
The company has been narrowing its losses and aims to break even by the end of this year.
“I want to be clear that we are not doing this as a shortcut to profitability,” CEO Anthony Tan wrote in a message to employees Tuesday.
He called the “restructuring” a “painful but necessary step”.
“Change has never been this fast. Technology such as Generative AI is evolving at breakneck speed. The cost of capital has gone up, directly impacting the competitive landscape,” the letter said, according to an excerpt posted on Grab’s website.
“The primary goal of this exercise is to strategically reorganize ourselves, so that we can move faster, work smarter, and rebalance our resources across our portfolio in line with our longer term strategies.”
The company is on track to break even this year even without the layoffs, Tan said.
Grab laid off 360 employees in 2020 –- then about five percent of its full-time workforce -– as the pandemic hit demand for its services.
In 2018, Grab cemented its position as Southeast Asia’s biggest ride-hailing firm when it bought Uber’s operations in the region, ending a bruising battle with its U.S.-based rival.
The company went public on Wall Street in 2021 by merging with a special-purpose acquisition company, or SPAC.
The transaction was the largest-ever U.S. public market debut by a Southeast Asian company, Grab said at the time, and valued the company at $39.6 billion.
But its shares have plummeted since debuting at $13. They were selling at around $3.40 on Tuesday.
Southeast Asian technology firms have been slashing their workforce as they focus on profitability, including Singapore-based Sea Ltd which cut more than 7,000 jobs last year, froze salaries and slashed spending.
Grab’s Indonesian rival GoTo laid off 600 workers this year in addition to 1,300 jobs last year.
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