Cult.fit, the health and wellness platform formerly known as Cure.fit, terminated approximately 150 employees. This marks the first instance of layoffs at the Bengaluru-based company in the last three and a half years.
The layoffs have affected employees across various departments. "Approximately 130-150 employees from senior to mid-level positions were impacted by the restructuring," revealed a source, as per media reports.
The layoffs are primarily aimed at extending the runway and reducing costs. However, the company has denied these reasons. In a statement, a company spokesperson mentioned, "We have reduced some redundant positions with the aim of streamlining operations. This move is part of our regular annual operating planning process."
"This is aimed at improving productivity and setting us up for full profitability in FY25. We have done this with thoughtful consideration and with the interest of creating long-term value for our stakeholders," stated the spokesperson.
Discussions regarding the layoffs at Cult.fit initially surfaced on the anonymous social media platform Grapevine on Monday. In the aftermath of the pandemic impact, Cult.fit underwent significant challenges, resulting in the termination of approximately 800 employees and the permanent closure of numerous fitness centres across the country in May 2020.
The fitness segment of Cult.fit encompasses the management and operation of fitness centres, providing a variety of workout options. In June 2021, Cult.fit joined Tata Digital through a strategic agreement with the Tata subsidiary.
Subsequently, in December 2021, the startup secured $145 million in funding in a round led by Zomato. In a move to expand its reach, Cult.fit acquired a majority stake in F2 Fun & Fitness, becoming the master franchise partner for Gold’s Gym in India in February 2022.
The company seems to be actively working towards recovery from the setbacks caused by the pandemic. In FY23, it successfully reduced its losses by 20%, down to Rs 551 crore from Rs 688 crore in FY22. Additionally, revenue operations witnessed a substantial increase, surging 3.2 times to Rs 694 crore from Rs 216 crore in FY22.
Earlier this week, Tata Steel declared its intention to close two blast furnaces in Britain by the year-end, leading to the potential loss of 2,800 jobs at its Port Talbot steelworks in Wales. This move is in line with Tata Steel's strategy to transform its financially challenging UK steelmaking operations by shifting to lower carbon electric arc furnaces. The company is backed by a government investment of £500 million ($634.10 million), according to Reuters.