” I is well aware that I had to make a hard decision , not because we are a public busines, or to protect or stock price, or to delight our Board or investors ,” Uber CEO Dara Khosrowshahi wrote to employees today in a memo, viewed by TechCrunch.” I had to make this decision because our very future as an essential service for the cities of the world — our being there for millions of people and industries who rely on us — necessitates it. We must establish ourselves as a self-sustaining enterprise that no longer relies on new fund or investors to keep ripening, expanding, and innovating .”
As part of the layoffs, Uber is expected to pay up to $ 145 million to employees via severance and other benefits, and up to $ 80 million in order to shut down bureaux, according to a filing with the SEC.
This comes precisely weeks after Uber laid off 3,700 hires in order to save about$ 1 billion in rates.Since the COVID-1 9 pandemic hit, Uber has laid off about 25% of its workforce.
Rides have been hit hard amid the coronavirus. More specific, rides are down about 80%, according to the company. Food delivery, however, has been red-hot. In Q1, Uber Eats suffered major proliferation with blatant bookings of $4.68 billion, up 52% from that same quarter one year ago.
” I will caution that while Eats proliferation is accelerating, the business today doesn’t come close to covering our outlays ,” Khosrowshahi wrote in the memo today.” I have every belief that the moves we are stirring will get Dines to profitability, just as we did with Rides, but it’s not going to happen overnight .”
Meanwhile, Uber is in talks to buy GrubHub to beef up its meat delivery business, UberEats, according to The WSJ and Bloomberg. Uber firstly approached Grubhhub earlier this year with an offer, but the two companies are still in talks, according to the WSJ. A Bloomberg report says the distribute could be finalized sometime this month. Khosrowshahi. nonetheless, did not mention this deal in the memoranda today.
In an attempt to organize more around its core furnish, Uber is shutting down Incubatorafter less than 1 year of launch. It’s also shutting down AI Labs and looking into alternatives for Uber Works, a service Uber launched in October to match craftsmen with changes .
Those not affected in these layoffs are operators, which are not currently classified as employees but rather independent contractors. Still, many operators have continued to be vocal amid the coronavirus pandemic, asking better protections and benefits. Last week, rideshare operators staged a van demonstrate to requirement Uber comply with AB spend into the state’s unemployment insurance benefits store and slip the ballot initiative it proposed along with Lyft and DoorDash that aims to keep gig laborers classified as independent contractors .
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