Carpool service Lyft is cutting 13% of its workforce, the company announced Thursday.
“Lyft needs to get leaner, which is forcing us to let go of great team members,” co-founders Logan Green and John Zimmer wrote in a blog post. “Layoffs affect all organizations across the enterprise.”
Employees who lost their jobs will receive 10 weeks of pay, health insurance coverage until April 30, 2023 and recruitment assistance. Employees who have been with Lyft for more than four years will also receive an additional four weeks of pay on top of the 10 weeks.
The company said several economic challenges, such as a looming recession next year and rising carpool insurance costs, factored into the decision.
Lyft also said it’s not the first time this year it has taken steps to cut costs.
“We’ve been working hard to reduce costs this summer,” the co-founders wrote. “We slowed down, then froze hiring; cut spending; and suspended less critical initiatives.”
The company also announced that it was looking to sell its first-party vehicle service business.
“We need 2023 to be a time when we can execute better without having to change plans in response to external events,” the co-founders wrote. “The harsh reality is that today’s actions are preparing us to do just that.”
Lyft shares are down more than 60% year-to-date, and the market cap is just under $5 billion as of Thursday.
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