Meesho has become one of the few startups in India’s fledgling e-commerce industry to turn a profit, helped by cost cuts that included a round of recent layoffs.
(Bloomberg) — Meesho has become one of the few startups in India’s fledgling e-commerce industry to turn a profit, helped by cost cuts that included a round of recent layoffs.
The Bengaluru-based online mall, which sells everything from clothes to jewelry and electronics, managed a slim profit for the month of July, said Dhiresh Bansal, its chief financial officer. The company, which counts SoftBank Group Corp., Prosus NV and Meta Platforms Inc. among its backers, made sales of $406 million in the six months through June, Bansal said.
To break even, the startup laid off around 250 employees in May and cut spending on customer acquisition, marketing and server infrastructure. To drive growth, it focused on value-added services such as shipping and product handling for merchants, the executive told Bloomberg News.
“We expect to continue being profitable and grow margins over the next coming quarters as well,” Bansal said Friday, declining to give a specific number.
Meesho competes with Amazon.com Inc. and Walmart Inc. in a burgeoning Indian online retail market that’s expected to grow to $325 billion by 2030 from $70 billion last year, according to Deloitte.
The company wants to focus on profitability, growth and adding users for some time before it decides go for a public listing in India. Meesho, which now employs about 1,300, has begun hiring again for specific roles that could propel that ambition, Bansal said.
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