Uber CEO Dara Khosrowshahi.
Philip Pacheco/AFP via Getty Images
Uber’s CEO has told employees the company will cut spending on hiring, incentives, and marketing.
In an email to staff obtained by CNBC, Dara Khosrowshahi said Uber investors needed to see returns.
He said of Uber investors: “We need to show them the money.”
Uber CEO Dara Khosrowshahi has told staff the company will rein in spending across the board to focus on investor returns.
The ride-hailing and delivery group will treat hiring as a “privilege” and pull back on the “least efficient” incentive and marketing spend, Khosrowshahi said Sunday in an email to employees, obtained by CNBC.
“In times of uncertainty, investors look for safety,” he wrote. “Channeling Jerry Maguire, we need to show them the money.”
Khosrowshahi didn’t provide further detail on Uber’s plans for hiring and incentives, or clarify whether he was talking about staff incentives, such as bonuses and stock awards, or driver incentives. Uber didn’t immediately respond when contacted by Insider for comment.
Uber isn’t the only tech company talking about a hiring squeeze. Meta announced to staff on Wednesday it would scale back hiring as a way to tackle slow revenue growth, according to an internal memo seen by Insider. Meanwhile, stock-trading app Robinhood announced in late April it was laying off 9% of its workforce.
Uber’s Q1 earnings, published Wednesday, showed the company posted a net loss for the period of $5.9 billion.
Khosrowshahi said in his Sunday email he’d spoken to investors after the earnings and it was “clear that the market is experiencing a seismic shift and we need to react accordingly.”
“The average employee at Uber is barely over 30, which means you’ve spent your career in a long and unprecedented bull run,” he said. “This next period will be different, and it will require a different approach.”
Khosrowshahi said Uber had made “a ton of progress in terms of profitability” but “the goalposts have changed. Now it’s about free cash flow.”
He said: “The least efficient marketing and incentive spend will be pulled back. We will treat hiring as a privilege and be deliberate about when and where we add headcount.”
He added: “In some places we’ll have to pull back to sprint ahead. We will absolutely have to do more with less.”
Tech stocks have taken a dive in 2022 amid fears of slowing economic growth.
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Source:: Business Insider