Mass Layoffs at Zomato

In a surprising move, Zomato (now Eternal) has laid off approximately 500-600 employees from its customer support team, citing non-performance as the primary reason. This decision has sparked controversy, with some employees claiming they were terminated without any prior notice.

Employee Backlash and Social Media Outcry

Employees affected by the layoffs have taken to platforms like Reddit to voice their frustrations, revealing that the layoffs have been ongoing for several weeks. Many were part of the Zomato Associate Accelerator Programme (ZAAP), a initiative that had hired over 1,500 people last year for customer support roles based in Gurgaon and Hyderabad.

The AI Revolution in Customer Support

This move by Zomato reflects a broader trend among tech companies to leverage artificial intelligence (AI) for automating customer support functions, thereby reducing operational costs. Companies like Paytm and Ola are also adopting AI solutions, leading to significant job cuts in the sector.

Financial Performance and Future Plans

Despite expanding into the quick commerce sector through its acquisition of Blinkit, Zomato has reported a sharp decline in consolidated profits, dropping to Rs 59 crore in the December quarter from Rs 138 crore a year earlier. In a bid to motivate its remaining workforce, Zomato has announced the grant of 2,17,960 stock options to eligible employees.