Uber has laid off 265 engineers and 170 members of its product team because it is a successful company based on sound financials that is not badly in need of a drastic overhaul.
It’s so far from needing a corporate mulligan that the layoffs, representing about 8 percent of each team, came after CEO Dara Khosrowshahi “asked everyone on our management team a simple but important question: if we started from scratch, would we design our organizations as they stand today,” according to a statement from the company. This is generally not the sort of question posed to senior leadership in a company firing on all cylinders, and which opted to go public only a few months ago.
All 435 of these apparently non-essential personnel follow the 400 marketing employees Uber also laid off in late July. “Our hope with these changes is to reset and improve how we work day to day,” Uber wrote in its statement, which tries and fails to put a positive, maverick spin on what is a pretty drastic reduction its technical workforce. The company said these changes include “ruthlessly prioritizing, and always holding ourselves accountable to a high bar of performance and agility.” It made this announcement in the midst of Apple’s iPhone 11 keynote event.
According to TechCrunch, which first reported the news, the layoffs coincide with the company lifting a hiring freeze it set in place in August. Generally, the proof that a hiring freeze has ended is evidenced by employing new people rather than tossing several hundred old ones out on their asses. In fact, Uber said earlier this week that it plans to hire 2,000 employees in its Chicago office—but most of those new hires will work for Uber Freight, the company’s trucking division, which was reportedly not impacted by today’s layoffs.
News of the layoffs comes as California lawmakers ready to vote on legislation, called AB5, that would likely require Uber and other gig work companies to classify drivers as employees instead of independent contractors. Uber and competitor Lyft have campaigned heavily against the bill, which is expected to pass into law, and it is widely expected to hurt their ability to make a profit—something neither company has done to date.
Meanwhile, Uber’s stock price has continued to drop.