Uber Technologies, Inc. (UBER - Free Report) recently slashed 8% of its workforce (435 employees), laying off 170 people from the product team and 265 from the engineering. The workforce reduction was done to eliminate overlapping or duplicate roles as well as to get rid of the underperformers. Majority of those retrenched are based in the United States.
An Uber spokesperson has been quoted as saying, “Our hope with these changes is to reset and improve how we work day to day — ruthlessly prioritizing, and always holding ourselves accountable to a high bar of performance and agility”.
It is to be noted that the job cuts had no impact on Uber Eats and Freight. Additionally, the hiring freeze on the company’s product and engineering teams since early August has now been lifted.
The lay-off follows a month after its second-quarter 2019 earnings release wherein it incurred a loss of $5 billion (or $4.72 per share), reportedly its biggest quarterly loss to date. Moreover, the company had warned of the huge losses to persist through 2019 since this will be its “peak investment year”.
Since going public in May, the company has successively suffered losses and it is trying consistently to streamline operations by cutting costs. Earlier in July, the company had laid off 400 people in the marketing department following its first-quarter loss.
Zacks Rank & Key Picks
Uber carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space are Sohu.com Inc. (SOHU - Free Report) , Alphabet Inc. (GOOGL - Free Report) and Upwork Inc. (UPWK - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Each of the companies boasts an impressive earnings history. While Sohu.com and Upwork surpassed estimates in three of the trailing four quarters, Alphabet beat estimates in each of the preceding four quarters.
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