Uber Technologies said Wednesday it will lay off about 3,300 employees, or 10% of its workforce, marking the company's biggest job cuts since the start of the Covid-19 pandemic, as it works to better position itself against the growing threat robotaxis pose to its ride-hailing business.
The cuts will flatten management hierarchy levels, reducing organizational complexity that built up during a period of rapid growth and that is now proving an obstacle to decision-making, chief executive Dara Khosrowshahi told employees in a memo on Wednesday, September 2.
Khosrowshahi said a leaner organization would mean clearer responsibilities, faster decisions and more time spent building rather than coordinating. He said the changes would also generate savings that the company intends to reinvest in growth, innovation and the skills that will matter most in the years ahead.
Unlike several other technology executives, Khosrowshahi did not attribute the cuts to artificial intelligence, even though pressure to adopt the technology, and the efficiency gains it can bring, has driven large layoffs across the tech sector this year. The website layoffs.fyi has tracked more than 123,000 mass layoffs across nearly 390 companies.
Uber's shares have underperformed the S&P 500 index and rival Lyft this year, falling nearly 8% amid concerns over rising competition. Uber, based in San Francisco, operates ride-hailing, food delivery and freight services in dozens of countries and has been led by Khosrowshahi since 2017.
DoorDash, Instacart and local delivery platforms have squeezed Uber Eats, pushing the company toward deals such as its acquisition of Delivery Hero, valued at $14.8 billion, to gain scale and compete more effectively.
Robotaxi competition
Part of Uber's concern stems from reports of growing tension with Waymo, the largest robotaxi operator in the United States, which uses Uber's app to run its vehicles in Austin and Atlanta. Waymo is owned by Alphabet, the parent company of Google.
Waymo has also been expanding into new markets without partnering with Uber, while rivals such as Tesla ramp up their investment in robotaxis, fueling concern that a growing fleet of self-driving cars could erode Uber's lucrative role as the middleman between vehicles and passengers.
To defend its position, Uber plans to invest more than $10 billion in robotaxis over the coming years, backing companies developing autonomous-driving systems and positioning itself as a leading marketplace for driverless rides.
Adam Ballantyne, an analyst at Cambiar Investors, an Uber shareholder, said that as autonomous vehicle technology and partnerships grow and expand, a different kind of employee is needed to scale that business, compared with a model built around human drivers and the operational costs that come with it, including layers of management.
Restructuring details
As part of the restructuring announced Wednesday, Uber will reduce by 20% the number of employees working seven or more hierarchical levels below the chief executive, and cut in half the number of teams with only one or two direct reports.
The company will also merge some teams and concentrate much of its staff in strategic hubs. Uber will further limit fully remote roles to about 1% of its workforce, while maintaining its policy requiring three days of in-office work per week.
Largest cuts since 2020
The layoffs, first reported by Bloomberg News, are Uber's largest since May 2020, when a collapse in demand caused by the pandemic forced the company to cut 6,700 jobs, nearly a quarter of its workforce at the time.
According to media reports, Uber has also been struggling with the costs of artificial intelligence, after employees used up the company's entire 2026 technology budget in just four months.
According to its annual report, Uber had about 34,000 employees worldwide at the end of last year.
