Gudang Garam Layoffs Trigger Concerns for workers and Suppliers in Tuban, East Java
TUBAN, East Java – A widely circulated video depicting emotional farewells among workers at PT gudang Garam Tbk’s cigarette factory in Tuban, East Java, has sparked public concern over potential mass layoffs. While PT Gudang Garam has yet to issue an official statement confirming the job cuts, the situation raises fears not only for affected employees but also for the livelihoods of local suppliers and property owners who rely on the factory’s operations.
The video, showing dozens of employees shaking hands in a visibly saddened atmosphere, quickly went viral, prompting questions about the financial health of one of Indonesia’s largest cigarette manufacturers. The uncertainty comes as PT Gudang Garam’s financial performance for the frist semester of 2025 reveals a significant downturn,potentially driving the company to reduce it’s workforce and impacting the broader regional economy.
According to the company’s financial statements, net profit plummeted 87.34 percent to Rp 117.16 billion (approximately $7.3 million USD) compared to Rp 925.5 billion in the same period last year. Revenue also decreased by 11.4 percent to Rp 44.36 trillion (approximately $2.8 billion USD), while gross profit fell from Rp 5.06 trillion to Rp 3.7 trillion.Operating profit experienced a dramatic drop to Rp 513.7 billion from Rp 1,613 trillion.The company also reported an exchange rate loss of Rp 1.7 billion,reversing a Rp 39.3 billion profit from the previous year.
The financial strain raises the possibility of widespread layoffs extending beyond direct employees. Local suppliers, who provide raw materials and packaging, and property owners who lease land and buildings to the factory, are bracing for potential economic fallout. The extent of the impact on these stakeholders remains unclear pending official confirmation from PT Gudang Garam.As of Saturday, September 6, 2025, PT Gudang Garam Tbk has not publicly addressed the layoff reports. Kompas.com continues to seek clarification from the company and will provide updates as they become available.
