May 6, 2020 - Economy

Uber to lay off 14% of workforce

Uber CEO.

Uber CEO Dara Khosrowshahi. Photo: Riccardo Savi/Getty Images for Concordia Summit

Uber will lay off 3,700 employees, while CEO Dara Khosrowshahi will waive his salary for the remainder of the year, according to the company's most recent filing with the Securities and Exchange Commission.

The big picture: The cuts, which will be to the customer support and recruiting teams, represent about 14% of Uber's 26,900 employees, per CNBC. Much of Uber's ride-hailing business has vanished as people stay indoors during the coronavirus pandemic, even as the company's food delivery sector has seen a boom.

  • Uber's gross bookings are down 80% globally, The Information reported last month.
  • The company also recently withdrew its financial forecast for the rest of the year, a signal that it doesn't anticipate the downturn in business reversing anytime soon.

What to watch: Uber will report its earnings on Thursday. The company's stock was down more than 3% Wednesday morning.

What they're saying: In a memo to employees, Khosrowshahi suggested there would be more cuts down the line, according to CNBC.

  • "[A]s I said at yesterday's All Hands, this is one part of a broader exercise to make the difficult adjustments to our cost structure (team size and office footprint) so that it matches the reality of our business (our bookings, revenue and margins)," Khosrowshahi wrote. "We are looking at many scenarios and at each and every cost, both variable and fixed, across the company."
  • "We want to be smart, to move fast, to retain as many of our great people as we can, and treat everyone with dignity, support and respect. As I said yesterday, you can expect we will have a further, final update for you within the next two weeks."
Go deeper