Indonesian digital company GoTo is reportedly cutting more than a thousand jobs as it looks to cut costs, said a report on Bloomberg, citing people familiar with the matter. GoTo declined to comment on queries
According to the report, this is around 10% of its workforce and cuts will be made across divisions. GoTo was created via a merger of ride-hailing platform Gojek and eCommerce firm Tokopedia, and the company went public in April. Shares of GoTo surged in value after its debut on the Indonesia Stock Exchange (IDX) on 11 April. According to Channel NewsAsia, GoTo's shares climbed to as much as IDR 416 (US$0.03) versus the company's offer price of IDR 338 (approximately US$0.02) per share.
Prior to the IPO, the company also extended the the bookbuilding period for its initial public offering (IPO). The extension allowed more merchants and consumers to take up the allocation of IPO shares the company has set aside for them under its Gotong Royong Share Program.
At the end of August, GoTo said its second quarter results were focused on improving margins. Andre Soelistyo GoTo president director and ceo and co-founder said the company saw GTV and gross revenue growth on a year-on-year basis while its focus on monetisation and cost optimisation helped make progress on our path to profitability. This progress was achieved amidst external headwinds in second quarter including ongoing international geopolitical and economic issues and seasonality fluctuation from the extended Ramadan holidays, particularly in Indonesia. He added that across the industry there was also a rationalisation of marketing and incentive spending.
The news of the cuts comes shortly after Meta shook the industry with its layoffs across Asia. A check by MARKETING-INTERACTIVE on LinkedIn found that employees from departments including politics and government outreach, content design, product marketing, creative strategy, learning and development, news partnerships, employer branding and recruitment marketing, and recruiting were impacted. These were a mix of local and regional roles and it is unclear how many Asia Pacific employees in total have been impacted.
When asked how many employees in the region were impacted yesterday, Meta's spokesperson referred MARKETING-INTERACTIVE to a statement made by CEO Mark Zuckerberg (pictured). The 11,000 staff form approximately 13% of Meta's global headcount and was previously described by The Wall Street Journal as "the first broad headcount reductions" to take place in Meta's 18-year history.
Meanwhile, according to Forrester, VP, principal analyst J.P. Gownder, this is unlikelt to be the end of the cuts. He shared that tech companies that haven't yet laid off employees are carefully considering whether or not to do so.
“It wouldn't be surprising to see more layoffs in the next few months, particularly among firms whose fiscal year ends on December 31,” said Gownder. Companies are now setting up finances for success in 2023. Widespread economic concerns, some prompted by rising interest rates, others by the war in Ukraine, high fuel costs, and supply chain issues, are prompting these moves in anticipation of lower demand.