Uber laying off 3300 employees, says it will spend savings on AI & autonomous cars

Uber is cutting approximately 3,300 jobs, representing around 10 percent of its global workforce, as part of a sweeping organisational restructuring. The decision was announced in a company-wide email from Chief Executive Officer Dara Khosrowshahi, who described the move as necessary to streamline operations and align the company with its long-term goals. The layoffs, which affect employees worldwide, are set to bring the total number of Uber staff down to just under 30,000, nearly matching the company’s employee count from 2021. This marks the largest restructuring effort since the pandemic, with the previous significant reduction occurring in May 2020, when Uber laid off about 6,700 workers due to declining demand during lockdowns. The restructuring targets both managerial and non-managerial roles, aiming to simplify the company’s hierarchical structure. The number of managers is expected to drop by 20 percent, with some moving into individual contributor positions rather than being terminated. Additionally, the company is reducing the number of employees who report through seven or more layers to the CEO by 20 percent. Micro-teams consisting of one or two members are also being trimmed by nearly half. These changes reflect a broader effort to eliminate redundancies and enhance operational efficiency. Non-managerial roles are similarly impacted, with teams being consolidated where the division no longer serves a clear purpose. For instance, Uber’s three delivery operations groups, covering restaurants, retail, and direct services, are being integrated into single-owner teams at global, regional, and country levels. Similarly, the Core Services Engineering and Science teams are being merged, following a similar model used in the Mobility and Delivery divisions. A key component of the restructuring involves adjusting where employees are based. Global teams will be centralized in major hubs such as New York and San Francisco, while regional and country-level teams will operate from designated locations. Technology teams will remain in established tech hubs. Most remote workers are being asked to transition back to office-based roles, with only about 1 percent of the workforce remaining fully remote. The existing three-day-a-week hybrid policy will continue, and compliance with it will be strictly enforced. This shift underscores a strategic realignment toward greater physical presence and collaboration, particularly as the company focuses on its autonomous vehicle initiatives. The timing of the layoffs coincides with Uber’s increased investment in robotaxi technology. Khosrowshahi emphasized that the cost savings generated by these cuts will be directed toward growth and the company’s vision for an autonomous future. Uber has allocated more than $10 billion to robotaxi partnerships over the coming years, with investments in firms such as Avride, Lucid, Nuro, and Rivian. Despite these commitments, the company’s stock has declined by nearly 8 percent this year, raising concerns among investors about its competitive position against rivals like Waymo. However, the stock saw a slight rebound in premarket trading following the announcement. Notably, Khosrowshahi did not reference artificial intelligence in his communication, despite the company’s ongoing integration of AI into daily operations. The layoffs follow prior reductions in customer service and human resources, as well as a decision to slow hiring earlier this year.