Swiggy Layoffs 400 jobs, Aims for Profitability Ahead of IPO


Online food and grocery delivery giant Swiggy are gearing up for a significant workforce reduction, planning to cut around 400 jobs across various departments, including technology, call centre, and corporate roles.

This move comes as part of the company’s efforts to streamline operations, reduce costs, and achieve profitability in anticipation of its impending initial public offering (IPO) later this year.

Sources close to the matter reveal that this latest round of layoffs will impact approximately 6% of Swiggy’s workforce.

Senior executives have reportedly been tasked with identifying employees for the layoffs, marking the commencement of the process.

The decision to trim its workforce is directly linked to Swiggy’s strategic preparations for its IPO.

The company aims to present robust financial figures to potential investors during its public offering. “This is linked to the planned IPO of Swiggy, where it needs to present the best possible numbers,” stated a familiar source.

Swiggy, headquartered in Bengaluru, has undergone a restructuring process, notably in January 2023, when it let go of 380 employees.

The earlier restructuring was prompted by slowing growth in Swiggy’s food delivery business. While the core food delivery segment remains stable, the company has faced challenges, particularly in its grocery unit, Instamart.

Instamart has been a source of losses for Swiggy, contributing to the company’s increased focus on achieving overall profitability. Despite this, according to sources, Swiggy has a healthy financial position, boasting about $800-900 million in its coffers.

Regarding business performance, Swiggy’s core food delivery business has shown stability and growth, with a gross merchandise value (GMV) of $1.43 billion. However, the pressure to address the losses incurred by Instamart has become more pronounced as Swiggy aims to go public with an anticipated IPO size of $1 billion.

The competitive landscape in online food and grocery delivery includes Swiggy’s rival, Zomato, which is already listed. Swiggy’s focus on achieving profitability aligns with the broader trend among Indian companies planning IPOs in 2024. Notable names such as FirstCry, Ola Electric, Mobikwik, and Unicommerce are preparing for public offerings this year.

As Swiggy navigates these strategic changes, the company’s future actions will be closely watched in the lead-up to its IPO as it strives to position itself as a financially robust and attractive investment opportunity.

Source: India Today