The headquarters of Grab Holdings Ltd., in Singapore. Grab Holdings Ltd., reported its latest earnings on Feb. 23, 2023.
Bryan van der Beek | Bloomberg | Getty Images
Singapore-based Grab Holdings is cutting over 1,000 jobs, its CEO said Tuesday, in a bid to manage costs and reorganize the company in a competitive landscape.
In an email to staff, CEO Anthony Tan said the layoffs are a “painful but necessary step” that the ride-hailing and food delivery app operator must take to remain competitive in the future.
“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,” said Tan.
This is the group’s largest round of layoffs since 2020, when it cut 360 jobs in response to Covid-19 pandemic challenges.
Even without layoffs, Tan said Grab is on track to hit breakeven this year on group adjusted earnings before interest, taxes, depreciation, and amortization. In February, the company said it was bringing forward its target to the fourth quarter of 2023, half a year earlier than its previous guidance.
The CEO said the job cuts are not a “shortcut to profitability” but will enable Grab to adapt to the business environment and rapid emergence of A.I.
Tan said Grab will provide severance payment of half a month for every six months of completed service, or based on local statutory guidelines, whichever is higher. Laid off workers will also receive medical insurance coverage until the end of the year, repatriation support as well as career transition and development support, among other measures.
The announcement comes after Grab’s COO Alex Hungate told Reuters in September that the company does not expect to conduct mass layoffs despite weaker economic conditions. Hungate said Grab was “very careful and judicious about any hiring.”
Major U.S. tech firms like Amazon and Meta went on a hiring spree during the pandemic as lockdowns boosted business. Many later laid off thousands of workers as business conditions reverted to or approached pre-pandemic conditions.
Grab posted strong revenue growth and narrowed losses for 2022, citing a rebound in mobility demand.
Tuesday’s announcement is the latest round of layoffs from a major Southeast Asian tech company. In March, Indonesia’s GoTo announced it was laying off 600 employees to boost profitability, Reuters reported, while Singapore-based Sea cut more than 7,000 jobs in the last six months of 2022.
