Uber to cut 3,700 jobs, CEO Khosrowshahi to waive base salary

Uber to cut 3,700 jobs, CEO Khosrowshahi to waive base salary

Uber to cut 3,700 jobs, CEO Khosrowshahi to waive base salary

On top of the pandemic, Lyft was dealt another major setback this week. But Uber, which operates in more markets around the world than Lyft, could recover some lost revenue with its food delivery business.

On Wednesday, Lyft said it had seen a decline of more than 70% in trips on its platform as the United States started to implement shutdown orders.

Uber reported a Q1 per-share loss of $1.70 and revenues of $3.54 billion, making for a mixed set of results when compared to expectations.

For the first quarter ending on March 31, Lyft (NASDAQ:LYFT) reports EPS and revenue beats with sales up 24% Y/Y. Analysts had been predicting revenue of $893 million.

The company said cost savings measures it is implementing will reduce annualized expenses about $300 million by the fourth quarter of this year compared with previous projections.

Other U.S. tech companies have also been hit hard by the pandemic.

Uber said the layoffs, affecting 17 percent of its employee count, included its customer support and recruiting teams, and expects to incur about $20 million (roughly Rs. 152 crores) in costs for severance and related charges.

Lyft said it ended the quarter with $2.7 billion of cash and other funds it can quickly tap. The company declined to say whether it was pursuing a settlement or would fight the lawsuit in court.

Lyft's better-than-expected numbers are thanks to a ridership increasing 3% year-over-year to 21.2 million active riders even with COVID-19 affecting the company toward the end of the quarter.

Pressure on fees from restaurants and local governments could offset any increase in demand because of Covid-19, Wedbush Securities analyst Daniel Ives said.

Before the pandemic, Uber was spending heavily to grow Eats as it faced heavy competition from DoorDash Inc. and Postmates Inc.

The "massive, unlawful employee misclassification schemes" are also, the complaint outlines, in violation of California Assembly Bill 5 (AB5), which presumes that California workers are generally employees (versus independent contractors) entitled to protection under the state's Wage Orders, Labor Code, and Unemployment Insurance Code unless proven otherwise using a three-factor test.

Elliott joined California Attorney General Xavier Becerra and the City Attorneys of Los Angeles and San Francisco Tuesday in filing a lawsuit against Uber and Lyft, alleging the rideshare companies misclassified their drivers as independent contractors.

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