Uber adds another 3,000 job cuts as the company realigns its focus on its core business: ride-hailing and food delivery services. The recent announcement ups the total downsizing of its workforce to 23% or 6,700 employees, all in an attempt to curb losses brought by the coronavirus pandemic.
Earlier, Uber announced the removal of 3,700 employees from its customer support and recruiting teams as part of the first phase of countermeasures the company has planned. This time, however, the job cuts affect nearly all departments in a move to reduce investment in several “non-core projects.”
Uber also pegs its company to establish sustainability without the need for outside capital. In its regulatory filing published on Monday, the company forecasts its restructuring measures to generate a total of $1 billion in annual savings.
Its restructuring measures include the closure of its startup incubator program and AI research lab, a strategic alternative to Uber Works, and closing or consolidating 45 office locations globally.
Focus on core business
Chief Executive Dara Khosrowshahi said that the company is realigning its focus on its food delivery business, Uber Eats. Due to stay-at-home orders, the demand for Uber Eats spiked 50% in the first quarter. Khosrowshahi calls this its “next enormous growth opportunity.”
The ride-hailing industry has plummeted significantly caused by widespread shutdowns to contain the spread of the coronavirus.
Uber’s revenue from its ride-hailing trips dropped 80% globally in April.
Its competitor, Lyft, cut 17% of its workforce as the coronavirus pandemic ravaged its business. Previously, it was reportedly planning to offer $650 million in convertible debt to account for general corporate purposes such as working capital, expenditures, and potential acquisition.
Uber’s stock is up 3.76% to $33.69 as of writing.
