As part of a reorganization strategy geared at rebuilding its core ride-hailing product and increasing revenues, Lyft announced Thursday that it would lay off 26% of its workers, or around 1,072 individuals.
Additionally, the business disclosed in a regulatory filing on Thursday that it had decided to curtail hiring plans and remove 250 open positions.
In the second quarter of 2023, Lyft anticipates spending between $41 million and $47 million on employee perks and severance. In addition, the ride-hailing business added that it anticipates extra expenditures for stock-based compensation for affected employees and the associated payroll tax obligation.
David Risher, the recently appointed CEO of Lyft, emailed staff members last week that the firm will undergo a large employment reduction as part of a reorganization initiative. According to Risher, the change will let Lyft “better meet the needs of riders and drivers.”
Workers and industry observers have hypothesized that other divisions, like its bike-sharing business, may suffer the largest losses due to the focus on ride-hailing. However, Lyft did not specify if certain departments will be targeted for layoffs.
On May 4, Lyft will announce its first-quarter financial results.