Lyft said the primary goal of the restructuring is to rebuild its core ride-hailing product, which has been struggling since predecessor Uber’s acquisition by Saudi Arabia’s Oryx Media in late 2016. Lyft plans to cut costs by reorganizing its engineering and product teams, though it did not specify how many jobs would be eliminated. The company expects that restructuring will result in increased profits over the long term.
The company cited weak demand as the reason for its decision, with sales down in most of its major markets. Given the current climate, it may be difficult for the business to find employees willing to take a pay cut or work fewer hours.
Lyft’s announcement of a $47 million cost related to severance and employee benefits in the second quarter of 2023 reflects the company’s continuing struggles to compete against Uber. The ride-hailing company has been struggling to keep up with its competitors, especially in terms of economies of scale and rapid growth. This restructuring is likely one reason for Lyft’s slow down.
While many employees are uncertain about the future of the company, others feel that Lyft is still doing important work. As part of its restructuring efforts, Lyft is continuing to reduce its workforce. However, some employees feel that this will only help to improve the service moving forward.
Lyft has been shedding jobs for months now, but the company’s head of bike-sharing service told The Information that the cuts will be deepest in this department. Industry watchers speculate that this is because the ride-hailing industry is growing more competitive and Lyft doesn’t have a dominant market share like Uber does.
Lyft is expected to report earnings of $0.49 per share on revenue of $1.4 billion for the first quarter of 2019. Analysts polled by Thomson Reuters forecast earnings of $0.51 per share and revenue of $1.5 billion, respectively. Demand for Lyft