Uber Technologies said on Wednesday it will cut about 3,300 jobs, roughly 10% of its workforce, as part of a restructuring to remove management layers and reduce costs.
The cuts will reduce the number of managers in the company by 20%, with some being moved to individual contributor roles, an Uber spokesperson said, as reported by Bloomberg. The company didn’t disclose, however, what percentage of managers would be laid off. The cuts also apply to people who aren’t managers.
The company had about 34,000 employees globally at the end of last year, according to its annual report.
The move comes as Uber faces a difficult year amid investor concerns that autonomous ride-hailing companies such as Waymo could threaten its North American market. The company’s share fell nearly nearly 8%, and it has also underperformed the broader S&P 500
The latest round of layoffs marks its biggest workforce reduction since the pandemic-era shake-up in 2020, when the ride-hailing giant eliminated around 6,700 jobs as lockdowns brought travel demand to a standstill.
What did CEO Dara Khosrowshahi say about the job cuts?
Speaking about the decision, CEO Dara Khosrowshahi said the cuts would reduce organisational complexity that had slowed Uber’s decision-making and had created roles focused on coordination.
Khosrowshahi announced the changes in an email obtained by Bloomberg News, saying that Uber’s growth in recent years has created “more layers, more coordination, more fragmented ownership, and in some cases structures that made sense when businesses were smaller but no longer serve us well at our current scale.”
To make Uber “simpler and faster,” it is reducing the number of teams with only one or two members and paring back the number of employees who sit more than seven layers down from the CEO, Khosrowshahi said.
The company is also streamlining its core engineering, science and delivery groups, including combining its three operations teams for restaurants, retail and its white-label delivery service.
Khosrowshahi also said the changes will “generate savings that we intend to reinvest in growth, innovation, and the capabilities that will matter most over the coming years.” He said more investments will be made in drivers, couriers, and merchants around the world, in addition to upgrades to its core business and work to build an “autonomous future.”
Khosrowshahi did not mention the impact of AI in his announcement, but the changes are also driven by a desire to use more of the technology to drive daily operations. The job cuts are taking place across the US and other countries where the company operates in.
Its shares rose about 2% in premarket trading following the announcement, which was first reported by Bloomberg News.