The adjustment would affect more than 5,000 of the 27,000 workers that the company has worldwide.
Job adjustments come to Silicon Valley. Uber executives discuss a cut of about 20% of the company’s workforce due to the collapse of its transport business due to the coronavirus pandemic, according to the sources.
The layoffs, which have not yet been definitively decided and could vary, would affect approximately more than 5,000 of Uber’s 27,000 workers worldwide. These cuts would have caused, according to the aforementioned media, the resignation last Tuesday of the Chief Technology Officer (CTO), Thuan Pham, who joined Uber in 2013 and was the longest-serving executive in the company. More than 800 people, out of the 3,800 working on the engineering team, led by Pham, could be affected by the job adjustment.
With Pham’s departure, Uber has lost three of its heavyweights in less than a year: In June Chief Operating Officer (COO), Barney Harford, resigned, and in October Chief Marketing Officer (CMO), Rebecca. Messina, the one who left with the company.
The spread of the virus throughout Europe and the United States, and the obligation for citizens to remain confined to their homes, has sunk the demand for transportation, their main business. In recent weeks, vehicle bookings have fallen 80% compared to the same period last year. Almost 75% of the technological income depends on these trips. The increase in profits from its Uber Eats Online food ordering business doesn’t make up for the huge hole it’s generated in its accounts to have its thousands of drivers standing.
A mystery surrounding the future of Uber, which will present its accounts for the first quarter on May 7, is when the company will recover the activity prior to the pandemic. With most airports closed or with very limited activity and the cancellation of major events like concerts or sporting events, some of the most lucrative trips for Uber have disappeared.
It is not the first time that the technology company has decided to cut jobs in recent months due to the need to leave behind the losses that have accompanied the firm since its foundation 11 years ago. In September, the company laid off 435 employees in the United States, mostly engineers. In July, 400 workers from the marketing unit left the company.
Uber, which posted losses of $ 1.1 billion in the last three months of 2019, expected to hit profitability later this year. It remains to be seen whether the shock of the crisis has modified its forecasts.