Exclusive: Yellow.ai Lays Off Over 100 Employees Amid Automation Push

Core Insights - Yellow.ai has laid off over 100 employees, accounting for approximately 30% of its workforce, primarily affecting engineering and product teams [1][2] - The layoffs are part of a strategic shift towards agentic AI technologies, which require fewer personnel for development and support [3][4] - The company has deferred salary increments and appraisals for the past two years, indicating ongoing cost-cutting measures [2] Financial Performance - Yellow.ai's revenue in India declined marginally to INR 233.6 Cr in FY25 from INR 237.9 Cr in the previous fiscal year, while employee benefit expenses decreased by 23% YoY [4] - Despite the decline in local revenue, the company reported strong consolidated global growth of about 40% in FY25, with the North American market expanding nearly 90% [5] Compliance and Regulatory Issues - The auditor's report flagged non-compliance with FEMA regulations related to foreign currency advances, but Yellow.ai stated that it is a procedural matter and is working to regularize the situation [5][6][7] Business Model and Market Position - Founded in 2015, Yellow.ai transitioned from a consumer-facing model to a platform-led approach for enterprises, allowing them to manage chatbots and customer interactions [8][9] - The company serves over 1,100 enterprises across 85 countries, automating more than 16 billion conversations annually [10][11] - Yellow.ai competes with other players in the conversational AI space, such as Gupshup and Haptik [12]