sea ltd is cutting staff at its money-making gaming arm to contain costs. It’s the e-commerce giant’s second round of job cuts this year after a series of setbacks that have forced the company to shift its focus from unbridled growth to profitability.
According to people familiar with the matter, Southeast Asia’s largest tech company plans to slash staff at its most profitable division, Garena, and at new ventures in its R&D division. About 40 jobs will be posted in the game live stream app Booyah! downgraded, including in teams involved in product management and quality assurance, the people said, asking not to be named because the information is private.
The Singapore-based company is also closing several of its experimental ventures at its research and development unit Sea Labs, the people said. About a dozen employees working in areas like public cloud and blockchain will be laid off, one person said. The company has also withdrawn job offers for technical positions at its e-commerce arm Shopee, the person said.
“We remain focused on the long-term strength of our ecosystem. Accordingly, we have made some changes to improve the efficiency of our operations that will impact a number of roles,” Sea said in an emailed statement. Reuters was the first to report the job cuts. According to the company’s latest annual report, Sea employed 67,300 people at the end of 2021, double the number of the previous year.
The tech giant is now reducing its overseas presence and peripheral businesses as increasing competition and investor skepticism force the company to shift focus to boosting profitability rather than overseas expansion. Sea made its first major job cuts at Shopee in June.
The company is facing increasing pressure to cut costs as growth in its core e-commerce business slows from a pandemic-era high. Consumers are reluctant to spend online as rising interest rates and prices weigh on the economy.
Sea has lost nearly $170 billion of its market value since an October high amid questions about its cash-making prospects. The company said it expected Garena to see its first drop in bookings this year and last month withdrew its e-commerce guidance for 2022.
Sea’s e-commerce rival, Lazada Group, has ramped up investments across Southeast Asia and is looking to build on momentum in the region to expand in Europe. This week, Alibaba Group Holding Ltd., Lazada’s Chinese parent company, announced that it has invested $913 million in its Southeast Asian arm, bringing annual capital inflows to $1.3 billion.
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