It appears that the wave of layoffs, which slowed down in 2023, is making a vigorous comeback. Companies such as Google had hinted at significant layoffs at the start of 2024, and now, another tech giant, Flipkart, is implementing job cuts based on performance, reducing its team size by 5-7 per cent.
According to Mint, these cuts will stem from annual performance reviews and are slated to be completed between March and April. This isn't the first time Flipkart has resorted to performance-based layoffs, having conducted similar exercises over the past two years.
In a bid to control costs, Flipkart has abstained from new hiring over the past year. While finalising a $1 billion financing round, including investments from Walmart and other backers, Flipkart is strategising to optimise its resources across existing and new ventures.
Discussions on restructuring plans and the roadmap for 2024 are scheduled for a forthcoming meeting involving senior executives.
Despite the ongoing restructuring, Flipkart has decided to postpone its initial public offering until 2024, pausing its earlier plans slated for 2022-23. Furthermore, Flipkart's strategic moves, including the recent acquisition of Cleartrip partially owned by the Adani Group, have generated a gross merchandise value (GMV) of around $1.5-1.7 billion.
The company aims to further invest in its hotel business and expand Cleartrip's services beyond airline bookings.
Reportedly, Flipkart affirm the company's diligent efforts in streamlining internal operations for several months. This restructuring aligns with Flipkart's goal of reassessing its current and future business trajectories.
While securing $600 million in fresh capital from parent company Walmart as part of the ongoing $1 billion round, Flipkart's senior management actively seeks ways to curtail expenses in various categories.