Uber has announced another session of layoffs on Tuesday. This time from it’s a call for Uber’s product and engineering teams. The ride-hailing giant aims to lay off a total of 435 people or around 8% of its entire workforce. The news arrives a few months after Uber announced it would dismiss 400 employees from its marketing section. As per sources, the layoffs will have no impact on Eats, which is one of Uber’s top-performing products, including Freight.
This latest round of firing employees follows a harsh and tough second quarter for Uber. The company has missed its revenue estimations and has reported a loss of a record $5.2 billion. Last month, Uber had confirmed that it had placed a hiring freeze on new software engineers and product managers. But Now — even as it cuts hundreds of workers — the company says that freeze has been lifted. As per an Uber representative, they hope these changes will assist in resetting and enhancing their work scenario. The company aims to hold itself liable for a high bar of performance along with swiftness.
On the other hand, the ride-hailing giant aims to spend resources to counteract the anticipated passage of state law in California. The move would make it more difficult for sharing economy companies to classify workers as self-contractors. Both, Uber and competitor Lyft, say they will ally to spend $60 million to fund a ballot initiative in the state to develop a new grouping for drivers. If permitted, California’s Assembly Bill 5 could oblige Uber and Lyft to entitle drivers as employees, a move both companies admit could throw them into a financial dive. Analysts anticipate labor costs could boost 30% for Uber in the state if the government passes the AB5 bill. At the moment, Uber is trading at $33.14 per share. Besides this value is much less than Uber’s IPO pricing of $45 per share.