Bangalore-headquartered fashion e-commerce company, Myntra, has announced its decision to eliminate 50 jobs as part of a restructuring move. The reported restructuring is expected to affect employees across various departments within the company.
A spokesperson from Myntra has confirmed the changes but refrained from giving detailed specifics. The spokesperson stated that as they strive to meet the dynamic demands of their customers and embrace new developments and technological innovations, they occasionally recalibrate their business priorities and review the organizational structure.
The statement further clarified that as part of their regular business recalibration process, in cases where a small number of roles might be affected, Myntra extends an opportunity to its employees to explore alternate positions within the organization or its affiliated Group companies, where available.
The decision to remove jobs comes as e-commerce’s growth rate has slowed down in recent years. In the previous financial year (FY), the value of goods sold through e-commerce increased by about 44 percent from $25 billion to $36 billion. The following year, it grew by around 36 percent to reach $49 billion. However, in the most recent FY, the growth rate sharply declined to 22 percent, with the total value of goods sold reaching $60 billion.
Most of the job cuts will predominantly impact employees working in the in-house brand verticals. This decision comes as Myntra is reportedly planning a significant restructuring within these in-house brand verticals.
As part of its new strategy, Myntra is making changes to focus on specific private labels instead of expanding numerous in-house brands that were introduced in the apparel sector. Over the years, Myntra has launched approximately 20-25 of these brands, internally known as ‘master brands.’ Some examples of these master brands are Invictus, Ether, and Sangria. However, the company now plans to shift its attention to select private labels as it moves forward.
Myntra Financial Performance in FY22
In the fiscal year ending March 2022, Myntra, owned by Walmart, achieved a revenue of over Rs 3,600 crore. According to its consolidated annual financial statements filed with the Registrar of Companies, the companies operating revenue experienced a significant increase of 45.5% to reach Rs 3,501 crore in FY22. Additionally, it earned Rs 108.7 crore in non-operating income, mainly from services like electronic gift vouchers, royalty income, sublease revenue, and others, bringing the total collections to Rs 3,610 crore.
But Myntra lost 39% more money in FY22, even though they made more money. They lost Rs 597 crore compared to Rs 429 crore in FY21. The company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin worsened, declining by 272 basis points to -15.28% in FY22.
