Thuan Pham, Uber’s chief technology officer, is stepping down, the ride-hailing company said in a filing with the Securities and Exchange Commission Tuesday. Pham was the longest serving top executive at the company, having joined Uber in 2013.
The news of his departure was first reported by The Information, which also is reporting that executives at Uber are actively discussing a cost-cutting plan that could involve layoffs of up to 20 percent of the company’s employees. The layoffs haven’t been finalized, but could be announced in stages over several weeks, The Information added. If the company goes through with the plan, an estimated 5,400 employees could lose their jobs.
An Uber spokesperson declined to comment on the prospect of layoffs. “As you would expect, the company is looking at every possible scenario to ensure we get to the other side of this crisis in a stronger position than ever,” the spokesperson said.
“the company is looking at every possible scenario”
Uber’s ride-hailing business has dried up as a result of widespread shutdown orders due to the novel coronavirus pandemic. In a call with investors in March, Uber CEO Dara Khosrowshahi said its gross bookings in most major cities was down by as much as 70 percent. The Information recently reported that the company’s overall business was down 80 percent year over year. Recent gains in its food delivery Uber Eats division have failed to make up for big losses in its core ride-hailing product.
In the March call, Khosrowshahi said the company modeled “an extreme edge case” in which trip volume plummeted 80 percent. Even in that dire circumstance, Uber would still end the year with $4 billion in unrestricted cash, plus $2 billion in revolving credit.
But this isn’t the first time that mass layoffs have been on the table for the money-losing business. Uber laid off nearly 1,000 employees from its engineering, product, and marketing departments last year in an effort to shore up spending and address some of the company’s massive deficits.
Uber shares have fallen more than 50 percent in the past month due to investor concerns about the impact of the virus on bookings and a broader market decline. It’s especially bad timing for a business like Uber that had been aiming to achieve profitability in the fourth quarter of this year.
Pham’s resignation is certainly the end of an era for Uber. The CTO was the last holdover from the days when former CEO Travis Kalanick was in charge. Most of Uber’s top leadership was forced to stepped down amid the many scandals that engulfed the company, including Kalanick.
“While the work is never done, I feel comfortable hanging up my hat at a time when the Uber Engineering team is at peak productivity, we have built robust system scale and stability, and are well prepared to face the future,” Pham said in a statement. “This has been a labor of love for me, and I am so proud of what we have done as a team.”