Uber Announces More Job Cuts

Ride hailing company Uber is cutting even more jobs. The Wall Street Journal has reported that the company is slashing 3,000 more jobs.

According to CNBC confirmation, the new job cuts come less than two weeks after an initial round of layoffs. The last round was on May 6th and affected 3,700 employees of the company.

On Monday, Uber CEO Dara Khosrowshahi wrote in an e-mail to employees that the company would also be shutting or consolidating 45 offices around the world and it is considering cuts to other businesses, such as freight.

Shares were up as much as 9% on the news on Monday.

“Our balance sheet is strong, Eats is doing great, Rides looks a little better, maybe we can wait this damn virus out…I wanted there to be a different answer,” Khosrowshahi told employees in the email. “Let me talk to a few more CEOs…maybe one of them will tell me some good news, but there simply was no good news to hear. Ultimately, I realized that hoping the world would return to normal within any predictable timeframe, so we could pick up where we left off on our path to profitability, was not a viable option.”

Khosrowshahi wrote in the e-mail that Uber has “worked to provide strong severance benefits and other support for those leaving Uber, like healthcare coverage and an alumni talent directory.”
The CEO said that Uber is also taking special considerations to support people on U.S. visas or parental leaves.

In an SEC filing on Monday, the company estimated it would take a charge of $175 million to $220 million related to the cuts mostly in the second quarter of 2020, including approximately $110 million to $140 million connected to severance and termination benefits besides stock-based compensation.

The filing also revealed that Uber’s board of directors will forgo 100% of their cash retainers for the rest of the year.

According to the company these measures are expected to save at least $1 billion annually and that its key business functions wouldn’t be impaired by the cuts.

Disclaimer: We have no position in Uber Technologies Inc. (NYSE: UBER) and have not been compensated for this article.