Oyo is making its rumoured lay-offs, official. The company announced today, that it was laying off 5000 people from its workforce globally as part of the restructuring process announced in January as it looks to cut its spending and chase profitability. The latest job-cut would reduce OYO’s roster to 25000 globally.
The Indian startup, one of the largest in SoftBank’s portfolio, is mainly reducing staff in China, along with the US and its home country as it seeks to boost profitability. After its establishment in 2013, OYO has grown exponentially, peaking a valuation of $10 Billion. Although the revenues have substantially increased, the company recently had reported losses of about $335 Million and announced a restructuring post-January 2020 as it looks to increase profits. After WeWork’s implosion, SoftBank has also instructed the companies under its banner to prioritize profitability.
“The global restructuring exercise at OYO was announced in January 2020 and the recent developments in China are in line with the same. China is a home market for OYO, and we will continue working with our thousands of retained OYOpreneurs to deliver against our core mission of creating quality living experiences for millions of middle-income people around the world,” a spokesperson for OYO said.
“During the tough Coronavirus situation, we will continue to support the benevolent and resilient Chinese society, in every possible way. We want to thank our partners, employees, and customers for standing strong together.”
Ritesh Agarwal, the founder of OYO, said the global headcount would fall by about 17% from 30,000 in January. The company is also prioritizing improved relations with hotels and stronger corporate governance, he said. The worldwide overhaul was in full swing, he added. “By the time our restructuring process is complete, OYO will have over 25,000 employees worldwide,” he said.
“In our previous phase, we added a lot of properties to our platform and built the brand and mindshare,” Ritesh Agarwal said in an interview. “Our first focus of 2020 is growth with profitability.”
The lay-off follows a global trend of business meltdowns in the aftermath of the global spread of Coronavirus. Many big firms throughout the world have reported financial losses, including Apple, Tesla, Samsung, among others. The US stock markets also suffered a free-fall throughout last week as a result of the weakening of the second-largest global economy.
1 comment
Comments are closed.