ShareChat, a popular social media platform catering to India’s vernacular audience, has announced another round of layoffs, affecting 5% of its workforce. This marks the company’s second round of job cuts in six months, as part of its annual review process set to conclude later this month.
This is not the first time ShareChat has reduced its workforce. In August 2024, the company laid off 5% of its employees during a mid-year performance review. Prior to this, ShareChat implemented major cost-cutting measures in 2023, resulting in the termination of 700 employees in two separate phases.
Impact of the Latest Layoffs
ShareChat currently employs between 530 and 550 people. With the latest layoffs, approximately 25 to 30 employees will lose their jobs. While the number may seem small, it reflects the company’s ongoing efforts to streamline operations and optimize resources.
Despite the layoffs, ShareChat has shown significant improvement in its financial performance. The company’s operational revenue grew by nearly 30% in FY24, reaching Rs 718.1 crore compared to Rs 552.73 crore in FY23.
Additionally, ShareChat has managed to reduce its losses by 41.4%, bringing them down to Rs 1,898.94 crore. This demonstrates a positive trend in the company’s efforts to achieve financial stability.
To support its operations and growth, ShareChat raised $65 million in debt in 2024, spread across two tranches. Over the years, the platform has secured a total of $1.3 billion in funding from notable investors, including Twitter (now X), Alkeon Capital, Moore Strategic Ventures, and Tencent.
Challenges in the Social Media
The social media industry is highly competitive, with platforms like ShareChat facing pressure to retain users and generate revenue. Despite its focus on India’s vernacular audience, ShareChat must navigate challenges such as increasing operational costs and the need for innovation to stay relevant in the market.
While the layoffs are a setback for employees, ShareChat’s improved financial performance suggests that the company is working towards a more sustainable future. By cutting costs and focusing on revenue growth, ShareChat aims to strengthen its position in the competitive social media landscape.
ShareChat’s latest round of layoffs highlights the challenges faced by tech companies in balancing growth with cost efficiency. While the company’s financial performance has improved, it must continue to innovate and adapt to ensure long-term success in the dynamic social media industry.
