Ride-hailing company, Uber has sacked about 400 staff as part of the ongoing restructuring in the organization.
The company said the move is in tandem with its quest to cut down operational expenses after recording significant loss in its first quarter as public entity. The job cut took place globally in Uber’s Marketing Department.
The company had reported a $1 billion loss in its first quarter as a public company. It was listed on the New York Stock Exchange (NYSE) in May 2019.
The listing was recorded as one of the worst Initial Public Offering (IPO) in the United State after Uber experienced disappointing first-day trading. The stock of the car-hailing firm fell 7% at $41.57, dragging down the initial IPO price of $45.
Uber had said it might never be profitable with the yearly loss of $1 billion despite its growing revenue. And this has contributed to the cost-saving exercise carried out by the company, with about 75 offices affected globally.
It was gathered that Uber’s revenue grew by 20% to $3.1 billion, compared to $2.5 billion in the corresponding period of 2018, while its gross bookings rose 34% to $14.6 billion in the first quarter. The company’s food subsidiary, ‘Uber Eats‘ was, however, the key growth driver.
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Meanwhile, prior to the downsizing, Uber’s restructuring exercise had forced its Chief Operating Officer, Barney Harford and Chief Marketing Officer, Rebecca Messina, to step down in June this year. The company’s Chief Executive Officer, Dara Khosrowshahi, said their exit was due to his decision to be more involved in the company’s core businesses – Uber Rides and Uber Eats.
While reacting to the lay off in Uber’s internal memo to its employees, Khosrowshahi explained that the company’s teams were too big. This, according to him, created overlapping work, made for unclear decision-making, and could lead to mediocre results.
“As a company, we can do more to keep the bar high, and expect more of ourselves and each other.”
Khosrowshahi stated that the company’s current position has to be addressed fast. “Today, there’s a general sense that while we’ve grown fast, we’ve slowed down. You can see it in Pulse Survey feedback and All Hands questions, and you can feel it in much of our day-to-day work. This happens naturally as companies get bigger, but it is something we need to address, and quickly.”
Uber’s CEO and leader of marketing and public affairs, Jill Hazelbaker said the structure of the company’s marketing team would be more unified going forward.
Samson Oyedeyi.
