Uber Technologies Inc. is dismissing 435 employees, the second major staff cut this summer, as the company faces mounting losses and a declining stock price.
The eliminated jobs are in the product and engineering divisions, representing about 8% of those groups. Uber said it was firing about 400 marketing employees, about a third of that department, in July.
Four months after Uber went public, the stock is trading about 25% below the initial public offering price. Last month, the ride-hailing company reported its largest-ever quarterly loss of $5.24 billion. This week, California lawmakers are expected to vote on a labor bill that could dramatically alter the gig economy and foist new costs onto Uber.
Uber instituted a hiring freeze of technical employees in the U.S. and Canada last month. A spokesman now says the freeze is over following the staff cuts. The news was reported earlier Tuesday by TechCrunch.
“In the past, we grew our teams rapidly and in a decentralized way,” Dara Khosrowshahi, Uber’s chief executive, wrote Tuesday in an email to staff. “This made sense as we worked to scale the business globally and find product-market fit.... But at a certain point, bigger teams do not mean better results.”
Uber shares, which have been trending downward since late July, closed almost 4% higher Tuesday.
“We are not doing this for Wall Street,” Khosrowshahi wrote. “We are doing this for Uber. It’s critical we get our edge back and continually push ourselves to do better.”