• Source:JND
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Paytm Layoffs:  Paytm's parent firm One97 Communications is planning to lay off around 15 to 20 percent of its workforce to cut operational costs. The move will impact the jobs of around 5000 to 6300 employees. Meanwhile, Paytm's stock fell over 4 percent in intraday trade. At around 01:23 pm, the shares were trading at Rs 340.65, down by over 4 percent. The stock has tanked 52 percent in a year and in the last 30 days, it fell over 11 percent.

Reason for layoff

The cause for the company's drastic decision is to cut the expenses. According to the report of Financial Express, the company may reduce its workforce by about 15 to 20 percent. This indicates that 5,000-6,300 employees in the total workforce might lose their jobs. One97 Communications aims to save about Rs 400 to 500 crore with the job cut.

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When will Layoffs take place?

In the fiscal year 2023, One97 Communications had an average of 32,798 employees on its payroll. Of these, 29,503 were actively working. The total employee expenses for the fiscal year increased by 34 percent year-on-year to Rs 3,124 crore. The report claims that the downsizing process has already begun with over 1,000 employees being terminated in December.

Paytm posted rs 550 crore loss in Q4

One97 Communications, Paytm's parent company, posted a net loss of ₹550 crore in the fourth quarter, whereas last year it was ₹168 crore. The company's revenue from operations fell 3 percent year-on-year to Rs 2,267 crore in the March quarter. The Reserve Bank of India's (RBI) decision to prohibit Paytm Payments Bank resulted in he loss in revenue. Paytm CEO anticipates that the company will experience an immediate financial impact on revenue and profitability following the RBI ban on its affiliate Paytm Payments Bank.

Paytm CEO Vijay Shekhar Sharma, in a letter to shareholders, has explained the company's commitment to strengthen the governance framework, enhance cost-effectiveness, and address the influence on the company's financial performance as a result of regulatory actions.

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