Zomato Cuts 600 Customer Support Jobs as AI Integration Grows to Reduce Costs

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Zomato has reportedly laid off 600 customer support associates within a year of hiring them as the company increasingly integrates artificial intelligence (AI) to streamline operations and cut costs. The move comes amid slowing growth in its core food delivery business and mounting losses in its quick-commerce arm, Blinkit, according to a Moneycontrol report.

AI Replacing Human Roles?

The layoffs coincide with the launch of Nugget, Zomato’s AI-powered customer support platform, which is now handling over 15 million monthly interactions for Zomato, Blinkit, and Hyperpure. Industry experts suggest that this shift toward AI-driven automation is replacing traditional customer support jobs.

The affected employees, who were based in Zomato’s Gurugram and Hyderabad offices, were hired under the Zomato Associate Accelerator Program (ZAAP). The program promised career growth opportunities in sales, operations, supply chain, and program management. However, nearly 600 of them did not have their contracts renewed after a year.

Sudden Terminations Without Notice

According to the report, employees were dismissed citing performance and punctuality issues. They were given a month’s salary as compensation but were terminated without prior notice.

This isn’t the first time Zomato has laid off employees. In December 2022, the company cut approximately 100 jobs across product, technology, catalog, and marketing departments.

Slowing Growth & Cost-Cutting Measures

Zomato’s decision to reduce its workforce follows a 57% decline in third-quarter profits year-on-year. The company’s financial struggles, especially in Blinkit, have forced it to explore cost-cutting measures, with AI playing a key role in reducing reliance on human customer support.

While AI-driven automation is becoming a dominant trend in tech-driven businesses, the impact on human jobs raises concerns about employment security and the ethical implications of AI replacing workers.

Sources By Agencies