Indonesia's GoTo lays off 1,300 workers

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Indonesia's GoTo lays off 1,300 workers

Indonesia's biggest tech firm PT GoTo Gojek Tokopedia Tbk said on Friday it was laying off 1,300 workers or 12 per cent of its workforce, joining a wave of technology firms retrenching after years of rapid hiring due to an uncertain economic outlook.

GoTo is making adjustments to make sure it can navigate the uncertain road that lies ahead, as it says in a statement that global macroeconomic conditions are having a significant impact on businesses around the world.

GoTo said that it has achieved around 800 billion rupiah US $51 million in cost savings in the first half of this year through efficiency measures in technology, marketing and outsourcing.

The company has determined that further measures must be taken to make sure it is prepared for the challenges ahead, it said about the job cuts.

GoTo, a ride-hailing and financial services company, went public in April with a US $1.1 billion stock sale.

Its shares are trading 44 per cent less than its initial public offering price, as investor sentiment on the tech sector sours due to soaring inflation and interest rates.

Shares in GoTo went up 2.8 per cent on Friday after the job cuts were announced.

After a lock-up period ends on November 30, the company, backed by SoftBank Group, Alibaba Group and Singapore sovereign wealth fund GIC, is looking into a secondary offering of shares held by pre-IPO shareholders.

It reported in August that its half-year net loss more than doubled to nearly US $1 billion.

In recent months, Southeast Asia's largest-e commerce firm Shopee cut jobs in various countries and shut down some overseas operations as parent Sea struggled with losses.