Sea’s Shopee leaves Spain, to lay off teams in South-east Asia

SHOPEE, the e-commerce arm of New York-listed Sea, is pulling out of Spain and retrenching staff in South-east Asia and South America.

The exit from Spain comes less than a year after it launched in the country. It is also Shopee’s third departure from an international market. This comes shortly after the company reportedly announced global layoffs primarily affecting ShopeePay and ShopeeFood, its digital wallet and food delivery businesses.

Layoffs at Shopee will impact the ShopeeFood and ShopeePay teams in South-east Asia, the teams at Shopee Mexico, Argentina and Chile, and the cross-border team supporting Spain. It is not clear whether staff at its global headquarters Singapore will be affected. Other than Singapore, Shopee also has operations in Malaysia, Thailand, Indonesia, Vietnam and the Philippines.

Shopee’s Spanish e-commerce platform will cease operations on Jun 17 and all orders received till then will continue to be processed, Shopee said in a notice on its website.

In an internal memo to staff, Shopee CEO Chris Feng cited “elevated uncertainty” in the economy. “We believe that it is prudent to make certain difficult but important adjustments to enhance our operational efficiency and focus our resources,” he wrote.

Europe was tipped as a promising new arena for Shopee, which embarked on an aggressive international expansion last year to grow beyond its core market of South-east Asia and Taiwan.

The company has made significant headway in Latin America but fared worse in other new markets. Parent company Sea, headquartered in Singapore, announced Shopee’s withdrawal from India in March just months after starting operations there.

The group cited “global market uncertainties” in the withdrawal. Some analysts believed the move could help reduce Shopee’s cash burn amid a competitive environment.

Shopee pulled out of France in March as well, after what it called “a short-term, preliminary pilot”. The platform’s website in Poland, where Shopee made its European debut, appears to still be operational.

Major tech companies like Sea are under pressure to increase profitability amid a looming downturn. Investors, rattled by uncertainties in the macroeconomic environment, have taken flight from loss-making tech stocks in recent months.

Shares of Sea have plunged 68.4 per cent this year and last closed at US$70.62 on Monday.