Shopee, southeast Asia's answer to Amazon, is closing shop in 4 countries and laying off staff days after its billionaire founder said he'd forgo a salary
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- Ecommerce platform Shopee is laying off HR, regional ops, marketing, engineering staff.
- Shopee was launched in seven Southeast Asia markets in 2015 and now operates in 13 countries.
- Shopee reported a loss of $931.2 million in the second quarter of 2022, widening significantly compared to 2021.
Shopee, a Singapore-headquartered ecommerce platform and one of Southeast Asia's answers to Amazon, is laying off staff and shuttering certain operations in Latin America amid widening losses.
Staff members were told of job cuts to the HR, regional operations, marketing and product, and engineering teams at department-wide town halls on September 19, local Singapore outlet Business Times reported, citing unspecified sources. Insider was not immediately able to verify how many jobs would be affected.
Affected employees will receive compensation packages "in line with market norms," Shopee and Singapore's Creative Media and Publishing Union, or CMPU, told Insider in a joint statement. CMPU is an industry-wide union that represents employees in the creative media, publishing, and journalism sectors.
Shopee parent Sea Limited will also fire 3% of Shopee's Indonesia-based employees, Bloomberg reported, citing an internal memo and an anonymous source familiar with the matter. The report did not specify when the job cuts would be made.
"These changes are part of our ongoing efforts to optimise operating efficiency with the goal of achieving self-sufficiency across our business," Shopee told Bloomberg in a statement.
Shopee was launched in seven Southeast Asia markets in 2015 and now operates in 13 countries across Southeast Asia, Latin America and Europe, including Brazil, Poland, and China. Among its main competitors are Alibaba-backed ecommerce company Lazada group, Akulaku, and Bukalapak, per CB Insights.
On top of scaling back operations and cutting jobs, Sea Limited's billionaire cofounder Forrest Li said on Thursday that top management will forgo salaries and tighten expenses, per Bloomberg. The leadership team will go without compensation until the company reaches self-sufficiency, Vulcan Post reported, citing a 1,000-word internal staff memo.
Shopee reported a loss of $931.2 million in the second quarter of 2022, widening significantly from a net loss of $433.7 million in the second quarter of 2021, according to Sea Limited's financial statements.
The job cuts come as the ecommerce company shuts operations in Chile, Colombia, and Mexico, and is exiting its Argentinian operations entirely, Straits Times reported on September 9. Shopee's Brazilian presence will not be affected.
Revenue from Southeast Asia made up 63.5% of the company's total revenue in 2021, while Latin America contributed 18.6% to the annual revenue, according to the company's 2021 annual reports. While Southeast Asia's contribution to revenue has remained more or less stable, Latin America's contribution to total revenue grew from 13% in 2019 to 18.6% in 2021.
However, in Brazil, Shopee's revenues rose by 270% year-on-year in the second quarter of 2022, the quarterly statements show. The statements do not state the numerical revenues from Brazil.
The Shopee layoffs come on the heels of layoffs across the ecommerce industry. In late July, Ottawa-based Shopify announced it would be laying off 1,000 employees, or 10% of its global staff. In August, Bain-backed ShipBob laid off 7% of its staff. The layoffs are part of an industry-wide downsizing due to repeated supply chain disruptions and unprecedented inflation, according to an August 12 Statista report.
Sea Limited did not immediately respond to Insider's request for comment.
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