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Uber discusses plan to lay off about 20% of employees

• finkin1 6y ago
  The amount of corporate debt could be a real problem in the coming months. I'm curious to see how all of these economic recovery programs end up working when we look back in a year.
  • nemonemo 6y ago
    I'm not well versed in the economics, so could you elaborate how the corporate debt would be a problem in this economy? Wouldn't the lowered rates & other activities by Fed be helpful for the entities with massive debt?
    • cm2187 6y ago
      The fed can help with liquidity (i.e. ensuring that whoever needs to fund itself has liquidity by flooding the capital markets with cash). It cannot help with solvency though (if you can't afford your debt because your revenues collapsed, no private lender is going to lend to you, even if they have the capacity to fund the loan). The interest expense is low, but when your debt becomes due, it is the end of the game.
      • Groxx 6y ago
        Ignoring (increasingly common) bailouts, basically, yeah.
        • 0x8BADF00D 6y ago
          Even if the Fed nationalized every US company, the interest rate would skyrocket in the corporate debt market. It actually makes things worse. No creditor will want to touch those bonds, hence the interest rate naturally increases to entice would be creditors.
    • arawde 6y ago
      When a downturn like this happens, the Federal Reserve lowers rates to encourage spending. But at the same time, people are less likely to hold corporate debt and instead hold cash. People are less likely to hold corporate debt because the corporation has less revenue to service its debt. In the case of a (highly) public company which doesn't have profits, if Uber were to try to sell bonds, the spread over, say, treasuries, would probably be above 8-10%. In other words, corporate debt isn't priced according to lowered rates. It's priced according to what bond investors would need to be paid in order to adequately compensate for the risk of Uber going bankrupt. The only way the Fed would help would be if the Fed bought Uber's bonds, but that would require Uber to be investment grade, which would be laughable, or a "fallen angel", a company which was investment grade before the crisis but has since been downgraded.
      • chrisco255 6y ago
        The Fed is buying junk bonds right now: https://www.bloomberg.com/news/articles/2020-04-09/fed-unleashes-fresh-steps-for-as-much-as-2-3-trillion-in-aid https://www.bloomberg.com/news/articles/2020-04-09/fed-unlea... This underscores the desperate maneuvers the Fed is undertaking to avoid the inevitable. They've killed the free market to save zombies like Uber, which are unprofitable.
        • michaelyoshika 6y ago
          Socialism is coming, whether we admit it or not.
          • turingbike 6y ago
            The Fed's policies (at least since 2008) could be described as "socialism for the management upper class" - they got free money that they gave to themselves as bonuses. Their companies were buoyed up, regardless of what the market wanted or whether the business was sound.
          • pstuart 6y ago
            It would be nice if it was shepherded by those that believe in "public good". My hopes are tempered in that regard.
    • nerfhammer 6y ago
      fed mostly only helps cover short-term debts, not long-term debts.
• jedberg 6y ago
  Didn't they just do a 20% layoff last September?
  • joeblau 6y ago
    The article says 435 in Sept which was 8%.
    • jedberg 6y ago
      Ah ok. Article is paywalled for me so I couldn't see that.
    • lainga 6y ago
      8% of what? All employees, or engineering? (435/0.08) ~= 5400, and Uber's S-1 filing says they had 22,263 employees as of 31-12-2018. https://www.sec.gov/Archives/edgar/data/1543151/000119312519103850/d647752ds1.htm https://www.sec.gov/Archives/edgar/data/1543151/000119312519... (ed. - article says 27,000... but Uber's had three low-hundreds firings chunks tallying ~1260 total over last summer, and said they were freezing engineering hires. Were the extra 8k hired in the first half of 2019?)
      • artursapek 6y ago
        22,000 employees not counting drivers? Holy crap.
        • newfriend 6y ago
          Did you actually think they had 22,000 employees including drivers? What a fatuous remark
          • artursapek 6y ago
            I honestly have no idea how many people drive for Uber. I guess it's in the hundreds of thousands?
• hm8 6y ago
  Outline link for non paywall - https://outline.com/Yf3CLV https://outline.com/Yf3CLV
  • AlphaWeaver 6y ago
    This includes the same snippet of the article listed on the website, and doesn't bypass the paywall, FYI.
• michaelyoshika 6y ago
  On one hand, I don't understand why they need so many employees for a ride-sharing platform. On the other hand, I can understand that people are just so eager to find another growth point so anything looking like a growth point could get almost unlimited capitals then hire a lot.
  • draw_down 6y ago
    Over 25 minutes until the first “Why do they have so many employees” post. You’re slipping, HN!
  • jfim 6y ago
    That's the case for many tech companies, why does Twitter need thousands of employees? Turns out there's lots of employees to do all kinds of things, the app side is only the tip of the iceberg. There needs to be people collecting metrics and analyzing them, people building the platform that employees use to deploy code and run batch jobs, maintaining infrastructure (IIRC Uber did onprem -> cloud -> onprem), people interacting with customers and drivers, local expansion teams, and so on.
    • dclusin 6y ago
      Does twitter really need those metrics? Just because people want metrics doesn’t mean they need to or should be collected. I have seen over the years posted here and again that highly targeted advertising and the ensuing surveillance infrastructure that that entails hasn’t really resulted in a significant improvement over non-targeted generic advertising like keywords and brand based advertising. So they could probably be as effective from revenue perspective without all the infra to spy on people and the manpower that requires. Huge revenue slumps like these tend to facilitate come to Jesus moments with regards to staffing and mission priorities. I suspect if twitter had or was going to losE confidence of the stock market and needed to show improvement a lot of the so called mission critical metrics would probably go.
      • nindalf 6y ago
        Any change deployed by large software firms are checked to make sure that no team wide and company wide metrics are adversely affected. How do you do that if you don't have the metics in the first place?
• diogenescynic 6y ago
  More layoffs are coming. I know PayPal is going to shift a bunch of jobs from San Jose to Austin when this is all up. There will be way more layoffs or relocations.
  • deleted 6y ago
    [deleted]
  • kaesar14 6y ago
    Do you have a source, or just rumors?
    • diogenescynic 6y ago
      I’m being let go and it’s super obvious. They hired our replacements in Austin in March and they started in April. But now management is playing games hiding them under other org trees, etc. They did the same thing last year. There was obviously going to be a lay-off at the end of March like last year, but they delayed it to not look bad PR-wise. My manager has even casually started making strange comments like “all the jobs will eventually be in Austin” and “sometimes you just have to get laid off” so it’s like they’re telegraphing it at this point.
      • kaesar14 6y ago
        That's rough, I'm sorry to hear that. All the best in your search for a new opportunity. Tough times all around.
      • iphone_elegance 6y ago
        Probably a good thing in the long run, this industry needs to come back down to earth it's ruining a lot of peoples lives And pretty much a waste of american talent
      • dclusin 6y ago
        If you think your team is going to get laid off you could maybe try to volunteer for it and negotiate for a more generous severance package. Big cos like that typically set aside money for those things and how it gets distributed is discretionary.
• xbeta 6y ago
  It's bound to happen when the business is at a complete halt for a few months. :-(
  • SlowRobotAhead 6y ago
    True, but look at all the things Uber has been getting into. While Silicon Valley start ups have been trying to be the “Uber of <whatever>”. Uber doesn’t seem to want to be Uber, at least not the potentially fair/unfair drive share program. I think it’s been clear they have been looking to change models, maybe this lines up with that.
  • United857 6y ago
    There's still Uber Eats -- I'd expect that's grown significantly which would help soften the blow.
    • kaesar14 6y ago
      As I understand it, Uber/Lyft were making a profit on actual rides in the mature markets. Uber was taking a heavy loss on each food delivery. So this crisis has been a double whammy to margins even though I suppose increased volume/adoption is good long term.
    • asdff 6y ago
      Food delivery is a huge premium on top of already inflated restaurant prices. I would expect most people are trying to save money and making a lot of their own food.
      • gambiting 6y ago
        Yeah, since the lockdown started we haven't had any takeaways, just cooking everything at home. Feels like ordering food in this situation is too frivolous.
        • CamperBob2 6y ago
          Feels like ordering food in this situation is too frivolous. Rest assured, your neighborhood restaurants would beg to differ.
• 3fe9a03ccd14ca5 6y ago
  If layoffs are the only downside we have to massive unemployment, then I will consider us very lucky. Another scenario that commonly follows periods of high unemployment is severe political unrest. That’s the kind of fertile environment that has historically preceded some very bad things. I hope the shutdown is worth it.
  • taywrobel 6y ago
    The president just suggested that people inject disinfectants and then lied about it being sarcasm the very next day. Even if that were true, what kind of world leader thinks it’s a good idea to be sarcastic during a global pandemic to troll the media? Maybe it’s time for severe political unrest.
    • ApolloFortyNine 6y ago
      >Maybe it’s time for severe political unrest. Yikes, you might not like Trump, but can you not call for "severe political unrest."
      • taywrobel 6y ago
        Our political system is full of perverse incentives that leads to a false sense of democracy. The electoral college and first past the post voting leads to a constant two party system, where people in most states don’t get a real vote since their state is safe for one party and winner takes all. Neither party has any incentive to address it tho, since it benefits them both both equally. They hate each other and are as separate politically as they can be (often times taking a position just to spite the other party). But with only two parties with any real chance of winning, they’re chances are better and arguments easier to make than when facing a half dozen parties spanning the whole political spectrum. So we go from more extreme liberal to more extreme conservatism leader, like America as a whole is manic depressive. We’re more polarized as a nation than we’ve ever been before, including the lead up to the civil war. But now politician is a career, not a duty. And people make decisions that protect their careers. So in the current world we’ll never see an alternative vote introduced giving moderate candidates a shot. We’ll never see a change to the electoral college to make it so that votes against a “safe state”’s party matters at all. I’m not calling for unrest. Lord no, that’s against the law. All I’m saying is that there is a real risk of it happening due to the current climate, but maybe that’s not entirely a bad thing.
• eagsalazar2 6y ago
  They aren't profitable anyway - is this really in reaction to decreased revenue or is it a culling and reorg, timed and justified opportunistically to avoid bad PR and publicity?
  • deminature 6y ago
    Rides is bordering on profitability as of Nov last year: https://arstechnica.com/cars/2019/11/uber-lost-1-1-billion-last-quarter-says-rides-are-profitable-sort-of/ https://arstechnica.com/cars/2019/11/uber-lost-1-1-billion-l... Were the virus not to occur, the company was planning to be legitimately profitable by end 2020: https://www.reuters.com/article/us-uber-results/uber-sees-profit-by-end-of-2020-but-still-expects-full-year-loss-idUSKBN2002UQ https://www.reuters.com/article/us-uber-results/uber-sees-pr...
    • jahn716 6y ago
      Something about "planning to be legitimately profitable by end of 2020" makes me chuckle. Like most founders probably plan this for their businesses haha
      • deminature 6y ago
        I mean, the market agreed it was legitimate and Lyft was promising much the same in 2021: https://www.bloomberg.com/news/articles/2019-10-22/lyft-forecasts-profit-by-end-of-2021-sending-shares-surging https://www.bloomberg.com/news/articles/2019-10-22/lyft-fore...
        • Klinky 6y ago
          Market has never been wrong, bandwagoned or knee-jerked before.
          • mewpmewp2 6y ago
            Random outsiders with no understanding of the company are never wrong and their criticism is always spot on.
• aazaa 6y ago
  > Layoffs of that magnitude, which haven’t been finalized but could be announced in stages in the coming weeks, could result in more than 5,400 of Uber’s 27,000 employees losing their jobs. ... That figure of 27K total employees is surprisingly high, given that AFAIK, it doesn't include actual drivers. I'd be interested in knowing how these jobs break down by task.
  • jonknee 6y ago
    They're a global company that operates in 900 cities. I don't understand why so many people on this site seem to think it should be a few programmers and some suits to sign the checks.
    • Barrin92 6y ago
      because for the past 11 years, and people tend to forget how long this company has existed, they have been burning through money faster than star athletes after retirement while inventing increasingly convoluted metrics to claim to be actually profitable. Many people are just tired of seeing glorified sales and taxi companies disguising themselves as tech companies. The defining feature of a technology firm is reduction of marginal costs at scale. If you're adding human labour with every city you expand into you might have a problem on your hands if your banking on making facebook margins.There is an underlying exhaustion among some people, myself included, who want to see investments into basic research and real technological advances rather than yet another app delivering pizza being valuated at 50 billion dollars.
      • hckr_news 6y ago
        Uber’s engineering infrastructure is nothing to scoff at.
        • Barrin92 6y ago
          Yes, and I think that's the problem. The infrastructure is actually a cost for Uber. It's better to have less infrastructure. I have sometimes the feeling the infrastructure team at Uber is trying to build the tower of Babel to touch the heavens or something rather than considering that the end goal is giving people rides and not building more infrastructure. I think people should recognise that the taxi market has an advantage. It's a distributed system and a market. Taxis organise themselves. If you're going to replace an entire market with a centrally planned system and a giant electricity and compute eating machine then you better have something to show for it in terms of efficiency.
• alexbanks 6y ago
  Companies that are not profitable and have existed largely on hype/VC hype will continue to get crushed by their previous-years' bloat. Companies that depend on people being out and about will get crushed by the coronavirus. Uber is both.
  • dehrmann 6y ago
    I think Uber had a pretty clear path to profitability prior to this. The only open question was could they raise prices enough to not drive customers away and not be undercut by Lyft. Lyft is in the same boat, so it would probably be like when airlines started charging for checked bags--once one does it, they all do. As for the demand curve? I think they could make it work. Like Wework, what Uber does is a real business. It just got over-hyped.
    • def8cefe 6y ago
      Lyft isn't their only competition. If they (Uber or Lyft) raise prices they will lose out on a lot of their appeal over traditional taxis. Cost relative to taxis is the main reason Uber and Lyft were successful in the first place. Many taxi dispatches have already adapted to app based ordering, tracking and payments as well.
      • alexbanks 6y ago
        Yeah, both companies existed to "disrupt" the traditional taxi industry and I think they succeeded. Traditional cabs have changed a lot (while continuing to charge what rides actually cost).
        • def8cefe 6y ago
          Well, they exist(ed?) to make money. They did so by innovating in the taxi industry. One of them did this by breaking the law in every jurisdiction they operated in then lobbying to make their conduct legal after the fact. But yes, they did disrupt the industry and there are now COTS solutions for taxi brokerages to accept rides in similar ways such as iCabbi.
• DevKoala 6y ago
  I wonder if the CTO really "resigned" or was kicked out. Uber's engineering culture is well known for not thinking about costs early in development. Moreover, ignoring infra costs, the revenue per engineer is really low, it is at around 1 million dollars per engineer; 11BN revenue / 10k engineers. I work for a team in which the revenue per engineers is 2 times higher than that and we aren't any sort of unicorn.
  • newfriend 6y ago
    Do you have a source for them having 10k engineers? That seems extremely high. I'm going to guess that you are wrong, and grossly exaggerating numbers to stroke your ego or because of bias. Also I'm sure you understand that things change with scale. Comparing a tiny irrelevant company to a global one may not be as straightforward as you think. Edit From the article: > which comes as the 3,800-person Uber engineering group I was right, your numbers are way off.
    • DevKoala 6y ago
      I got my numbers from a projection that also had them at 11BN revenue by now. The actual number for 2019 is 4.1BN. So yeah, Uber makes earns very little per engineer/product member compared to healthy companies. https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2019/ https://investor.uber.com/news-events/news/press-release-det... Btw, no bias, but interesting that you took it there. What motivated the comment? Can't someone be critical of the performance of an executive? It seems that a lot of people believe that running things at scale somehow requires defying basic business principles, when in reality is quite the contrary. You need to be even more vigilant of those metrics.
      • newfriend 6y ago
        > The actual number for 2019 is 4.1BN You are wrong, again. 4.1BN is the revenue for Q4. From your very own link: > GAAP Revenue 2019: $14BN So yeah, I guess it's much healthier than your company isn't it? It's fine to be critical, but let's not make up fake numbers and then draw conclusions from that. There also seem to be many people here who are overly critical of Uber specifically because of it's image.
• MattGaiser 6y ago
  There is an older Hacker News comment by an Uber employee about how they built and maintained their own chat app. I suspect they realized that not everything need be custom. https://news.ycombinator.com/item?id=20931644 https://news.ycombinator.com/item?id=20931644
  • notatoad 6y ago
    and then in the replies to that comment, it's revealed that they actually did not build and maintain their own chat app, they just had a custom-branded release of mattermost. probably not the best example of not-invented-here syndrome.
    • tims33 6y ago
      And now they are on Slack. https://markets.businessinsider.com/news/stocks/slack-stock-price-jumps-after-uber-moves-all-employees-app-2020-2-1028928235 https://markets.businessinsider.com/news/stocks/slack-stock-...
    • carbonatedmilk 6y ago
      Yeah, except they did rewrite the entire Mattermost mobile clients in React Native (And contributed it back, too - https://eng.uber.com/uchat/ https://eng.uber.com/uchat/) Look, I'm all for Uber firing some of their 27,000 employees (27,000 seems like the wrong number), but their engineering team make a tonne of cool stuff and are really good open source citizens. H3 Geospatial indexing, Kepler.gl, and yes the Mattermost react native client - I use them all every day. Maybe let's trim in the HR and marketing departments, instead?
      • brutusborn 6y ago
        How many of these contributions have became part of Uber's core business? I agree that their open source contributions are laudable, but it seems unfair to expect them to bankroll projects that don't contribute to the bottom line, especially if they are bleeding cash. It would be different if they were rolling in cash like the faang companies.
• nitwit005 6y ago
  This feels like an odd question to ask, but are they losing money faster or slower now? They were previously spending billions in marketing costs, and it sounded like at least some rides were a net loss.
  • djannzjkzxn 6y ago
    People would say things like “losing money on every ride” but this didn’t appear to be correct based on the released financials. It was more like “making some money on rides overall, but spending tons of money on overhead”. Losing ride volume only makes that situation worse.
    • MiroF 6y ago
      But that overhead was largely marketing and they bundled discount prices into marketing expenses.
      • djannzjkzxn 6y ago
        If you look at the Uber 2019 annual report, page 64, you can see that revenue was $14.1B, cost of revenue was $7.1B, and sales and marketing was $4.6B. $14.1B - $7.1B - $4.6B = $2.4B Driver bonuses fall under cost of revenue, and user promotions fall under sales and marketing. It’s only after subtracting other overhead that the company becomes unprofitable. Other overhead includes operations and support, research and development, and general administrative. If you read the descriptions of these categories it becomes apparent that they are going to need to lay people off if they cut spending there. Sales and marketing also includes a lot of headcount. All the above math includes both rides and eats. There are other numbers in the annual report that show that rides is making more money overall while other areas are losing more.
        • yashap 6y ago
          For those wondering where the rest of the $$$ went, the main other costs were about $5.8 billion to R&D, and $3.3 billion to “General and Administrative.” Although, R&D costs were very inflated in Q2, due to stock payouts and whatnot related to the IPO, in the other quarters R&D costs were well below Sales and Marketing. So normally “cost of revenue” and “sales and marketing” would be the top two categories, then R&D. Realistically, they need to cut from pretty much everywhere, especially with revenue tanking during COVID. Even without that one-time IPO related payout of about $3.6 billion last year, they still would’ve burnt ~$5 billion. Their losses this year, with massively decreased revenue due to COVID, could probably be $10+ billion (if they didn’t lay people off). That’d be for non-IPO costs staying static while revenue drops ~35%. And I believe their nest egg is only ~$10 billion, so that’s very roughly around 1 year of runway, much too short. They need to cut a LOT of costs.
• eBombzor 6y ago
  As if the job market wasn't difficult enough... now about 5,400 highly qualified and experienced developers are looking for the same positions as I am... What do I even do now...
  • itake 6y ago
    Where do you get those numbers? I think a lot of companies are keeping engineering talent and laying off other types of employees (like recruiting, marketing, sales, etc.)
    • toomuchtodo 6y ago
      https://layoffs.fyi https://layoffs.fyi
      • tomashertus 6y ago
        That's very interesting web! I wonder where they are taking the data from?
        • toomuchtodo 6y ago
          Crowdsourcing news links and tips from the public.
  • mrmonkeyman 6y ago
    Not all developers..
  • phased20 6y ago
    For what it's worth, it's unlikely that all 5,400 employees would be engineers. Your odds might be better than you think!
    • deleted 6y ago
      [deleted]
  • deleted 6y ago
• dang 6y ago
  I've asked The Information to unlock this article for HN readers (see https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20%20%22the%20information%22%20%20unlock&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...) but in the meantime the hard paywall means we have to bury it. Edit: done now. Thanks!
  • mnkc 6y ago
    Will be keeping an eye out for it, thanks!
• baron816 6y ago
  > revenue to nosedive by $17 million to $22 million in the quarter. It's interesting how often news articles get millions and billions mixed up. I feel like I see it all of the time. Apologies for the digression.
  • avree 6y ago
    There's no billion/million mixup here. Quarterly revenue will be down by 17-22 million.
    • baron816 6y ago
      Oh, indeed. Well, the phrasing still easily leads to confusion as it could be interpreted as falling to $22 million (which is way too little), rather than falling by a range of $17-22 million. Would've been better as "revenue to nosedive by between $17 million and $22 million in the quarter"
    • yuliyp 6y ago
      That number can't be right, though. They have a billion in revenue per month. You wouldn't describe a 1% decline as plummeting.
• zaroth 6y ago
  > Uber said it expects an impairment charge of up to $2.2 billion in the first quarter due to the outbreak and for revenue to nosedive by $17 million to $22 million in the quarter. The impairment charge is on the “reduced value of equity investments”. Not sure what that’s about. But “revenue to nosedive $22 million...” this makes no sense. Last year Uber reported a net loss of $8.51 billion. I think $22 million is the cost of programs it has put in place to help drivers during the pandemic. In other words, a pittance. Last report was that Uber traffic had cratered 60-70% in Seattle as of March 19th. I can only imagine the world of hurt Uber is in for based on a global 60-70% revenue drop in the face of their fixed costs. $22 million ain’t it.
  • deleted 6y ago
    [deleted]
  • yashap 6y ago
    Indeed. In 2019 they had GAAP revenue of $14 billion (and GAAP net loss of $8.5 billion). The article is clearly wrong, their quarterly revenue is way above $39 million - they haven’t reported Q1 2020 earnings yet, but revenue will be in the billions. Regardless, layoffs are necessary. Even before COVID, Uber was burning money at an absolutely insane rate, and really don’t have much runway for a public company. Obviously COVID makes the situation much worse. Heavy layoffs suck for everyone who loses their job, but they are necessary here.
  • saisundar 6y ago
    Uber's q4 2019 revenue was 4B $. A drop of 20 million (ignoring the fact that quarterly results look at YoY, as opposed to quarter to quarter) from expectations would be... quite impressive? ( quite in contrast to other reports of a 80% drop in volume of rides.) I think what might be interesting to watch is their forecasts for next quarter, as well as for the year.
  • KT-222 6y ago
    This was sloppy reporting/writing. The "revenue to nosedive by $17 million to $22 million" was the specific effect only attributable to their Covid-19 financial assistance program. Here's the quote directly from Uber's release: "To support those whose earning opportunities have been depressed as a result of COVID-19, as well as communities hit hard by the virus, we announced and implemented several initiatives during the first quarter of 2020, including a financial assistance program for drivers and delivery people. We intend to account for this program as Contra Revenue, which we expect will reduce GAAP Revenue by an estimated $17 to $22 million in Q1 and an estimated $60 to $80 million in Q2." https://investor.uber.com/news-events/news/press-release-details/2020/Uber-Announces-Date-of-First-Quarter-2020-Results-Conference-Call-Withdrawal-of-Guidance-and-Preliminary-First-Quarter-Financial-Items/default.aspx https://investor.uber.com/news-events/news/press-release-det...
• tanilama 6y ago
  The unblocked version says 800 out of 3800 engineers will be slashed. That is pretty uniform and brutal TBH.
• uptown 6y ago
  March 19th: "Uber shares soar after CEO says enough cash to ride out coronavirus crisis" https://www.reuters.com/article/us-health-coronavirus-uber/uber-shares-soar-after-ceo-says-enough-cash-to-ride-out-coronavirus-crisis-idUSKBN2162MN https://www.reuters.com/article/us-health-coronavirus-uber/u... April 21: "Uber Bookings Now Down 80%" https://news.ycombinator.com/item?id=22938687 https://news.ycombinator.com/item?id=22938687 April 28: Uber lays off 5400, CTO resigns [edit] - Fixed the dates. I've lost all track of time.
  • saisundar 6y ago
    Nit - I think you mean April 28.
    • benatkin 6y ago
      Also April 21 (checked the HN link and it says 7 days ago).
  • mangoman 6y ago
    those last two happened in April not March. I still think it's pretty stark to go from 'we are flush with cash' to '5400 laid off' in one month, but let's not push the idea that they fell off in one week.
    • segmondy 6y ago
      all that can still be true, statement 1 is relative tho. ride out the virus for how long? 1 month? 3 months? 3 years? By laying off 5400, they are now even more flush with cash. it's business.
    • hinkley 6y ago
      We are not an industry that is particularly strong on the capacity planning front. I don't know where that stems from, but we are constantly surprised when we have too much or not nearly enough of whatever we need, and we don't know what the right amount is until after it has already happened.
• JMTQp8lwXL 6y ago
  Uber is down 27% from its IPO. Not as bad as one may assume, given the hard data coming from its filings and, of course, the news coverage. Lyft is down 58%. At the troughs, Uber was down 48% and Lyft 72%. This moment --the layoffs and departure-- feels like a capitulation of the private equity valuations. We shouldn't feel good about people losing. But many have been shouting about how insane the blitzscale model is. Maybe it achieves it purposes for early investors -- that peak moment of IPO liquidation. But it certainly is no good for the employees and their morale for carrying on.
  • texasbigdata 6y ago
    Measuring equity cap with different levels of scale and capital structures across companies is not always insightful
• prodave 6y ago
  As c-suite exec, better to be incompetent during the good times than to be competent during the bad times. makes sense that he’s leaving.
  • dang 6y ago
    Personal attacks are not ok on HN, so please don't post like this. Maybe you don't owe a c-suite exec better, but you owe this community better if you're posting here. We're trying to stave off the default internet degeneration, to the extent possible. https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=by%3Adang%20stave&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
• siquick 6y ago
  How are the 3800 engineers divided up at a company like this? I know it's easy to say "why on earth are there 3800 devs, what are they doing all day?" but that does seem like a substantial amount.
  • beart 6y ago
    Yes I wonder the same thing - I think about Apple and how many engineers they have which also seems crazy for their "output" in terms of product variations. Uber is on a whole nother level, at least from the perspective of the average consumer.
    • dgellow 6y ago
      Not everybody works on customer facing products. Apple has a ton of software to manage their supply chain and other logistical things, which requires a lot of engineering effort. That’s what happen when you try to control every part of your product development.
      • deleted 6y ago
        [deleted]
      • shuckles 6y ago
        That engineering work is largely contracted out through IS&T. Apple’s product engineering org is famously lean.
    • golergka 6y ago
      Apple builds a lot of pretty complicated desktop software, cloud infrastructure, two popular programming languages and tooling for them, and even their own operating system, and their own hardware. I don't think it can truly be compared to a company built around a single app. Even if that app is very popular.
  • altonzheng 6y ago
    Join a large company and inspect the engineering org structure, and you will have the answer. Or ask someone that works at one :)
• product50 6y ago
  Bunch of random engineers in this thread talking about business when they have no clue how companies are run. Yes- Uber was making loss before. But their ridership was growing and they were giving incentives on the supply side (drivers) to bring more players in. Thus it made sense to continue investing in headcount to grow. Now, though, everything is disrupted. It doesn't matter that they are losing money slower - if the outlook of the business is weak then they cut costs and reduce headcount.
  • rlanday 6y ago
    “Lose money on every sale but make it up on volume” is not a sustainable business model.
    • product50 6y ago
      Oh please. Once you have very high volume and strong market share you can gradually increase prices to improve profitability.
      • rlanday 6y ago
        How much higher can Uber’s volume get? They will probably never exceed the volume they were seeing a few months ago and they still managed to lose $8.5 billion last year. How in the world do you increase prices by that much without losing most of your customers? Unfortunately in the age of coronavirus, the irrational exuberance is gone now.
• yalogin 6y ago
  Genuine questions here - Why does Uber have 27000 employees? What do they with that many people?
  • totorovirus 6y ago
    hoarding top-notch engineers in their pocket while they have enough capital?
    • njoubert 6y ago
      Only 3800 are core engineers (people reporting to Thuan) https://techcrunch.com/2020/04/28/thuan-pham-who-fled-vietnam-as-a-child-and-became-ubers-cto-in-2013-is-leaving-the-company/ https://techcrunch.com/2020/04/28/thuan-pham-who-fled-vietna...
  • three_seagrass 6y ago
    People on HN tend to vastly underestimate the number of bodies that can be used in sales and marketing at a global scale. Typically you have local teams in both silos running on the ground.
  • xxs 6y ago
    Most of it it'd be local operations, support. Lots of compliance and local marketing. They operate "in more than 900 cities"[0]. For example many cities would require drivers to be licensed to drive - that would require local support. The company is very far from dev. centric in that regard, just because they have headquarters in San Francisco. Likely they overhired development, HR and the like, of course. [0]: https://www.uber.com/global/en/cities/ https://www.uber.com/global/en/cities/
    • 9nGQluzmnq3M 6y ago
      Uber's S-1 (quoted below) claims 5,400 direct employees in platform support alone. Interestingly, I've seen an Uber floor while touring a third-party call center in Manila, so they probably outsource even more these days. Platform User Support We have invested in a network of global support centers to support our worldwide operations. We have ten primary support centers in Chicago (U.S.), Phoenix (U.S.), Limerick (Ireland), Krakow (Poland), San Jose (Costa Rica), Hyderabad (India), São Paulo (Brazil), Manila (the Philippines), Lisbon (Portugal), and Cairo (Egypt) with approximately 5,400 employees and 400 independent contractors who provide 24/7 support for platform users in the United States and in certain other countries. In addition to in-app, web, and phone support, Drivers can visit Uber Greenlight Hub locations for in-person support. https://www.sec.gov/Archives/edgar/data/1543151/000119312519103850/d647752ds1.htm https://www.sec.gov/Archives/edgar/data/1543151/000119312519...
• mushbino 6y ago
  Lyft is about to layoff roughly 30% tomorrow. That's the rumor anyway.
  • murphy214 6y ago
    from who?
    • mushbino 6y ago
      Oh, it looks like 17%. 1000 employees got laid off +300 furloughed. They are giving severance through mid July and they’re giving Modern Health mental health coverage through end of December. Plus a 10% pay cut across the board.
      • vvladymyrov 6y ago
        So is it full health coverage through end of Decemeber or only mental health coverage through the end of December? Anyway - sounds like decent severance by US standards.
        • mushbino 6y ago
          Full health coverage, I believe. It's about as good a severance as you're gonna get in the US.
• _pmf_ 6y ago
  Microworkforces are the new hot thing in SV.
• ggm 6y ago
  Uber is a net destructive play. Yes, taxi was a broken model but what uber did is suck social capital out of taxi, put driver against driver, rent seeking and import money to America from the world. A plague on uber and Airbnb. May they both rot. Btw this is not just troll bait this is my honest opinion. I talk to taxi drivers and use taxi and these people got predated on for a thin profit outcome.
  • ornornor 6y ago
    The sharing economy overall is a rotten model. Offloading externalities. It did give a kick to the taxi business because they had become overly complacent though so that’s a positive. But I won’t be sad either to see Airbnb and Uber die.
    • amelius 6y ago
      It's not just sharing, but it's platforms. One gatekeeper regulating an entire market of poorly paid workers. Everything from food delivery services to App Stores.
      • TeMPOraL 6y ago
        So the encompassing term would be, I think, gig economy. I can't think of a single gig economy company that wasn't an ethical disaster.
        • DoreenMichele 6y ago
          At the risk of sounding argumentative, I will suggest Textbroker does a pretty good job. http://writepay.blogspot.com/2020/03/the-textbroker-solution.html http://writepay.blogspot.com/2020/03/the-textbroker-solution... I don't think the gig economy has to be an ethical disaster. I'm aware a lot of gig platforms are awful in that regard, but I don't think it simply can't be done well just because it mostly hasn't been done well. "Ninety percent of everything is crap."
          • 6y ago
• overfitted 6y ago
  As an interesting side note it was also in the article's last paragraph about Uber not using Public Clouds such as AWS. Is that becoming more common or less? Is there any other examples of enterprises seeing benefits of running their own services? Referring to this part: ...they chose to largely manage their own online servers. While that led to some rocky moments early on, people who have worked at the company have said Uber was able to save substantially on costs.
  • mdavidn 6y ago
    If you can manage the upfront capital costs, physical servers are an order of magnitude cheaper than virtual servers for services that run continuously.
  • pm90 6y ago
    As a sibling mentioned, cheaper long term costs are a huge factor. Dropbox is another public example of a company that has transitioned away from the cloud [0]. Twitter famously still uses a data center for their big data processing. [1] 0: https://builtin.com/hardware/dropbox-magic-pocket-distributed-storage-system https://builtin.com/hardware/dropbox-magic-pocket-distribute... 1: https://cloud.google.com/twitter https://cloud.google.com/twitter
• Lukesys 6y ago
  Since when is this news? Has their ever been a time when Uber hasn't wanted to lay off a large proportion of their 'staff'?
• kungato 6y ago
  I wouldn't be surprised if they laid off 90%. They have the app and infra probably finished and stable, established brand, they tried all the markets they could, lawsuits should be over by now. They should just lay off, reduce fees and use the brand for market share
  • hammeiam 6y ago
    Would you be surprised if AirBnb laid off 90%? Or Google? Or Amazon? It's already built, right, so why do they need so many people just to keep the lights on?
    • bewareandaware 6y ago
      Probably just keeping the lights on won't cut it when a competitor arises, and by then they would have run a opportunity loss.