• Alibaba-owned Lazada is laying off about 5% of its staff across Southeast Asia as part of an efficiency drive.
  • The e-commerce platform has seen its market share slump to 11% in 2024 from 24% in 2020, while rival Shopee dominates with 53%.
  • The cuts come as Lazada accelerates AI adoption and streamlines operations to counter revenue declines and fierce competition.

Lazada, the Southeast Asian e-commerce arm of Alibaba Group, is cutting approximately 5% of its regional workforce, according to people familiar with the matter. The move is the latest in a series of restructurings as the company grapples with shrinking market share and intensifying competition from Shopee and other players.

The layoffs affect multiple markets, including Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam, and are part of a broader push to streamline operations and focus on efficiency. A Lazada spokesperson declined to comment on the specific number, but said the company is “making adjustments to our workforce to better align with our business priorities.”

The cutbacks come as Lazada’s regional market share fell to 11% in 2024 from 24% in 2020, according to industry estimates, while Shopee, controlled by Sea Ltd., held 53% over the same period. Revenue at Lazada declined 3% in its latest fiscal year, according to Alibaba’s filings, reflecting the pressure from discounting and heavy investment in logistics and AI.

“This is a necessary step to remain competitive in a market where margins are razor-thin,” said a former Lazada executive who asked not to be named. “The company needs to be leaner and more agile, especially as AI starts to automate more functions.”

The restructuring aligns with similar moves by other Southeast Asian tech firms, which have been cutting costs and focusing on profitability after years of breakneck growth. The region’s e-commerce sector is also facing increased regulatory scrutiny on data privacy and cross-border trade, adding further complexity.

Lazada said it will continue to invest in its core marketplace and AI-driven features, such as personalized recommendations and chatbot customer service. The company has been testing generative AI tools in recent months to improve seller tools and user experience.

Attempts to reach employee representatives for comment were unsuccessful.

This article has been updated to clarify the scope of the layoffs.