Lyft, the ride-hailing company, has announced that it will lay off at least 1,200 employees, reducing its workforce by 30%.[0] The move comes as the company seeks to cut costs and better compete against its biggest rival, Uber. Lyft CEO David Risher announced the layoffs in a memo to staff, stating that the company needed to become “a faster, flatter company where everyone is closer to our riders and drivers”. The cuts will be made in a fresh round of layoffs as the ride-hailing firm struggles to reach profitability. Lyft is aiming to reduce its costs so that it can offer affordable rides, compelling earnings for drivers, and profitable growth. The company has announced plans to invest in competitive pricing, faster pick-up times, and better driver earnings using the savings from the job cuts.[1]
The announcement follows Lyft’s move in November 2021 to cut 13% of its workforce, citing fears of a looming recession.[1] Several other US companies have announced similar measures since the start of the year, including Tyson Foods, Amazon, Meta, McDonald’s and Disney.[1]
Lyft’s latest earnings report was disappointing for Wall Street, while Uber’s report showed a 49% year-over-year increase in revenue.[2] Lyft’s stock is down roughly 70% over the past year.[3]
David Risher, a former Microsoft and Amazon executive, took over as CEO of Lyft on 17 April 2022, after co-founders Logan Green and John Zimmer announced they were stepping back from executive management roles.[4] Risher said the job cuts were necessary to create a faster, flatter company and reduce costs to focus on better meeting the needs of riders and drivers.[4]
Lyft is planning to use the savings from the job cuts to invest in competitive pricing, faster pick-up times, and better driver earnings. Lyft shares were up 6% in midday trading on Friday, following the announcement of the job cuts.[2]
0. “Lyft Plans Job Cuts That May Affect 30% of Employees, WSJ Says” Bloomberg, 21 Apr. 2023, https://www.bloomberg.com/news/articles/2023-04-21/lyft-plans-job-cuts-that-may-affect-30-of-employees-wsj-says?srnd=premium
1. “Lyft to significantly cut jobs, reports say” KRMG, 21 Apr. 2023, https://www.krmg.com/news/trending/lyft-significantly-cut-jobs-reports-say/KXUQKG7AWVCLHHPEIJGDOE5ZBU/
2. “Lyft plans to ‘significantly reduce’ workforce, CEO says | News Channel 3-12” KEYT, 21 Apr. 2023, https://keyt.com/news/2023/04/21/lyft-plans-to-significantly-reduce-workforce-ceo-says/
3. “Lyft Plans Job Cuts That May Hit 30% of Staff in Overhaul” Yahoo Finance, 21 Apr. 2023, https://finance.yahoo.com/news/lyft-plans-job-cuts-may-164612652.html
4. “New Lyft CEO warns workforce that major layoffs are coming next week – San Francisco Business Times” San Francisco Business Times , 21 Apr. 2023, https://www.bizjournals.com/sanfrancisco/news/2023/04/21/lyft-layoffs-ceo-david-risher.html