This decision follows a comprehensive six-month review of the company's customer support operating model and represents a fundamental shift in how the food delivery giant approaches customer care. The company is consolidating its remaining in-house teams at Gurugram headquarters while delegating a larger portion of customer care responsibilities to third-party vendors.
The restructuring isn't an isolated cost-cutting measure. It's the latest chapter in Zomato's broader workforce optimization journey, which has seen multiple rounds of layoffs since 2020. What makes this particular move significant is its strategic intent: it's not merely about reducing headcount, but about fundamentally reimagining customer support through AI automation and external partnerships. The affected employees will receive four months of severance pay and extended healthcare benefits until March 31, 2027—a package that, while generous compared to some previous rounds, still represents a painful human cost.
The operational cost pressures driving this decision are substantial. Before implementing its AI platform, Zomato's customer support operations had grown to $20 million annually, with 4,000+ human agents managing operations spread across 8-10 separate platforms including Zendesk, Freshdesk, Zoho, and Salesforce. This fragmented technology stack created data silos, limited insights, and sub-par customer satisfaction scores for auto-resolved tickets, even though approximately 60% of tickets were already being handled by bots.
The efficiency metrics tell a compelling story. Zomato's AI-native platform, called Nugget, now handles approximately 11 million tickets monthly.
Perhaps most significantly, the human workforce has been reduced from 4,000+ to around 1,000 agents, representing a 75% reduction in headcount while maintaining service quality.
These numbers aren't just impressive on paper—they're transformative for the bottom line. With customer satisfaction scores improving 2x and response times dropping 75%, Zomato has demonstrated that AI can deliver better service at a fraction of the cost. The Hyderabad closure is essentially the physical manifestation of this digital transformation: as AI handles more routine queries, the need for large, distributed in-house support teams diminishes.
The financial implications of eliminating 250 positions are significant. Customer service representatives at Zomato earn between ₹11,000-15,000 monthly, with median total compensation around ₹5,08,605 annually. .
However, the outsourcing strategy introduces complex cost dynamics. Outsourced BPO services in India cost $1,200-2,400 per full-time equivalent monthly ($14,400-28,800 annually). On the surface, this appears more expensive than direct salaries. But the total cost of ownership tells a different story: outsourcing eliminates infrastructure costs, management overhead, ESOP obligations, and technology platform expenses while providing scalability without fixed commitments.
The strategic value extends beyond immediate cost savings. Converting fixed employee costs to variable outsourcing costs enhances operating leverage, allowing Zomato to scale support capacity in line with demand without proportional headcount increases. This flexibility is particularly valuable in a business with seasonal fluctuations and growth uncertainties. The company's strong cash position of approximately ₹12,000 crore provides 20+ quarters of runway, eliminating near-term funding risks and giving management the confidence to make these strategic bets.
The transition to an outsourced, AI-first model isn't without risks. Zomato currently maintains a customer satisfaction score of 83/100 and a customer service rating of 3.9/5 stars. While AI implementation has driven significant improvements, outsourcing introduces quality control challenges that could undermine these gains.
Centralizing operations at Gurugram creates potential single points of failure. Unlike the previous distributed model with Hyderabad and Gurugram centers, a centralized approach introduces vulnerabilities: outages at the central hub can disrupt all operations, and geographic concentration increases systemic risk. Response times may also suffer for customers in South India who previously benefited from the Hyderabad center's regional presence.
Outsourcing brings additional quality risks. BPO providers face high attrition rates averaging 30-45% annually, with each departure costing $10,000-20,000 in replacement expenses. Cultural and communication gaps can impact service quality, and maintaining consistent brand voice across multiple vendors requires robust training and quality control mechanisms. Data security and compliance present further challenges, as BPO firms handle sensitive customer information and must navigate complex regulatory frameworks including GDPR and India's evolving data protection laws.
Customer complaints already reveal pain points. Over 7,942 complaints have been documented on consumer platforms, with common issues including delayed responses, chatbot limitations, refund processing delays, and delivery partner verification problems. The transition period could exacerbate these issues if not managed carefully.
The human dimension of this restructuring cannot be overlooked. Zomato has historically prided itself on its organizational culture—a decentralized, flat structure with empowered roles and informal systems. The company was ranked #8 in LinkedIn's 25 most amazing places to work in India in 2019, built on a mission of "better food for more people" and a culture that emphasized development and exposure.
However, the pattern of layoffs is taking a toll. This is the fifth significant workforce reduction since 2015, following cuts of about 10% of its global workforce in 2015, 13% in 2020, 3% in 2022, and approximately 600 customer support roles in 2025. The 2025 layoffs were particularly controversial, with reports of abrupt terminations based on strict punctuality metrics and allegations of "unethical removals" without notice or consideration of personal circumstances.
The cultural impact extends beyond those directly affected. Remaining employees may experience "survivor syndrome"—decreased engagement and productivity driven by job security anxiety. The tension between Zomato's "people-first" cultural values and its efficiency-driven automation priorities creates cognitive dissonance that can erode trust in leadership. Former employees have described the culture as "intense, fast, demanding"—an environment that may become increasingly difficult to sustain amid repeated restructuring.
Interestingly, there are signs of cultural resilience. Over 400 employees have returned to Zomato for second or third tenures, suggesting underlying organizational strength.
Whether this cultural resilience can withstand the accelerating pace of automation-driven restructuring remains an open question.
Zomato's restructuring reflects broader industry trends.
Major tech companies including Meta, Amazon, Microsoft, and Oracle have collectively committed hundreds of billions to AI infrastructure while simultaneously reducing headcount.
The strategic alignment with Zomato's profitability goals is clear. The company's food delivery business is already EBITDA positive at 5.6% margin, while Blinkit is progressing toward profitability with mature stores already in the black. The customer support restructuring supports this path by reducing fixed costs, enhancing operating leverage, and freeing resources for investment in growth initiatives.
However, the long-term employment strategy signals a fundamental shift. Zomato is moving toward a hybrid workforce model where core strategic roles (product, engineering, leadership) remain in-house, operational roles (customer support, logistics) are increasingly outsourced, and new AI-augmented roles emerge requiring different skill sets. This transformation aligns with the company's evolution under the Eternal umbrella, which encompasses food delivery, quick commerce, B2B restaurant supply, and events platforms.
The Hyderabad customer support centre shutdown represents more than a cost-cutting measure—it's a strategic bet on the future of work at Zomato. The company is prioritizing AI automation and third-party partnerships over traditional in-house staffing, a decision driven by compelling efficiency metrics and cost pressures. .
Yet the human cost and cultural risks are substantial. The pattern of repeated layoffs, allegations of unfair termination practices, and the tension between efficiency and employee welfare create challenges for maintaining the organizational culture that has been a source of competitive advantage. The success of this strategy will depend on execution excellence—flawless AI implementation, robust outsourcing partnerships, and transparent communication during transitions.
As Zomato continues its transformation under the Eternal umbrella, the company faces a critical balancing act: leveraging AI and automation to drive efficiency and profitability while preserving the cultural DNA and employee engagement that have fueled its growth. The Hyderabad closure is a significant step in this journey, but whether it represents a sustainable path forward or the beginning of a deeper cultural crisis remains to be seen.
