Uber is eliminating about 3,300 roles globally, spanning managers and non-managers, with reductions occurring in the US as well as other markets where it does business. According to an Uber spokesperson, managerial ranks will be cut 20%, and some managers will transition into individual contributor roles. The company did not specify what share of managers would be let go. To make the company "simpler and faster," Khosrowshahi said Uber will cut one-to-two person micro-teams by about 50% and reduce headcount situated more than seven layers beneath the CEO.
Uber will further rationalize its core engineering, science, and delivery organizations, folding together its three operations teams that serve restaurants, retail, and its white-label delivery offering. And as it narrows the parameters for where work happens, going forward, just about 1% of staff will be permitted to work remotely.
Khosrowshahi wrote that recent growth created "more layers, more coordination, more fragmented ownership, and in some cases structures that made sense when businesses were smaller but no longer serve us well at our current scale." Uber says the changes will free up money to bolster its ride-sharing and delivery businesses and to keep building toward an "autonomous future." The company has pledged more than $10 billion for robotaxi partnerships over the coming years and has shifted capital by trimming some holdings while backing Avride Inc., Lucid Group Inc., Nuro Inc. and Rivian Automotive Inc.
Bloomberg Intelligence analysts project the job cuts could yield $1.5 billion to $2 billion in savings on an annualized basis, while warning that increased autonomous-vehicle spend could limit margin expansion in the near term. Investors leaned positive on the news: Investor reaction tilted upbeat: in New York, the stock climbed as much as 2.1% to $76.79 before easing to a gain of under 1%.
Khosrowshahi did not mention artificial intelligence in his announcement, but the company said the shift is also driven by a push to use more of the technology in daily operations. The latest cuts follow earlier, targeted reductions this year in customer service and human resources. Following this action, Uber's total staff comes to just under 30,000 people, roughly the same level as in 2021.
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Unlike many Big Tech peers that have run repeated layoffs tied to AI spending, Uber had avoided large-scale reductions since the pandemic and said in May it would moderate hiring. For your wallet, the headline is simple: a leaner org makes it easier to fund the businesses you actually use, even if near-term margins may get tugged by robotaxi bets.
