The IDX-listed Indonesian tech giant GoTo has announced it will let go of 1,300 people or 12% of the group’s workforce. The decision, the company said, is needed to ensure its “long-term stability and sustainability”.
In a town hall meeting on Friday, GoTo’s CEO Andre Soelistyo told staffers that global macroeconomic conditions are having a significant impact on businesses around the world and GoTo is not immune. “Like other companies, GoTo is making adjustments to ensure it can navigate the uncertainty that lies ahead,” Soelistyo said, according to a statement by the company on Friday.
The news of the layoff was reported by DealStreetAsia on Nov. 11. Multiple sources had told DealStreetAsia that GoTo’s rising costs had prompted it to lay off around 10% of its staff. Bloomberg was the first to report that GoTo was looking to let go of employees to trim costs and achieve profitability.
In order to make the company sustainable, GoTo has focused on its core businesses — on demand, e-commerce and financial technology services. Soelistyo said the company has made progress in those areas on the back strategies of cross-platform users, reduced incentive spending, and deeper synergies across its ecosystem.
GoTo is also looking to improve efficiency by implementing end-to-end cost optimisation, unifying processes, consolidating vendors, renegotiating contracts for various cost items and finding structural efficiencies. “By the end of Q2 2022, around 800 billion rupiah has been saved in areas such as technology, marketing and outsourcing,” Soelistyo explained.
However, further steps were deemed necessary to reduce costs, which led to the firing of 1,300 people. “This was an extremely difficult decision, but a necessary step to support the health of the business,” he added.
The company will provide a severance package for the employees who have lost their jobs and “at least one additional month’s salary on top of what is statutory,” the company statement said.