Lyft is laying off 982 employees, furloughing a further 288 due to COVID-19 pandemic

Summary

TechCrunch article by Ingrid Lunden reporting that Lyft will cut 17% of its staff, 982 employees, and furlough another 288 because of the effects of COVID-19, less than 24 hours after reports that Uber was considering layoffs of 20% of staff. Salaries drop 30% for executive leadership, 20% for vice presidents and 10% for all other employees, and directors give up 30% of cash pay for the second quarter of 2020. Lyft expects a restructuring charge of between $28 million and $36 million. The piece says technology layoffs had passed 32,221 people since March 11, notes Lyft's pledge of $6.5 million for driver and community initiatives, and says Uber and Lyft shares rose 6% and 5%.

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Lyft is laying off 982 employees, furloughing a further 288 due to COVID-19 pandemic

Less than 24 hours after it was reported that Uber was considering layoffs of 20% of staff, its big rival Lyft is announcing its own cuts.

Today the company said it would be reducing employee count by 17%, working out to 982 employees, and furloughing an additional 288, due to the effects of the COVID-19 pandemic and its impact on Lyft’s business.

It also will put in place salary reductions of 30% for executive leadership, 20% for vice presidents and 10% for all other employees, while members of Lyft’s board of directors will forego 30% of their cash compensation for the second quarter of 2020.

Lyft said that it will take a restructuring charge of between $28 million and $36 million as a result, which will come through in its Q2 financials.

The news comes in the wake of technology sector layoffs now crossing 32,221 people since March 11. Transportation has been hit in a particularly tough way, in part because people are not moving around as much due to stay-at-home orders; and in part because of the worries of infection that people have around driving in vehicles in close quarters where others have been.

The Lyft layoffs are only a part of the labor discussion. Drivers for Lyft (and other ride-hailing platforms around the globe) are likely seeing similarly reduced incomes. If demand is high, drivers can profit through increased platform spend. If Lyft is cutting staff, it’s easy to presume that platform spend (GMV) is sharply down. This is expected, given the company’s withdrawn 2020 guidance, but worth considering from the perspective of the self-employed driver with a car note to cover.

Lyft has promised $6.5 million in “initiatives that support drivers and vulnerable communities” impacted by COVID-19, and Uber has made efforts to support some drivers during the pandemic. Both companies have also publicly discussed how their platform might help during the crisis, with Uber looking into delivering medications and Lyft working on delivery efforts for support orgs .

Market response

Heading into 2020, Uber and Lyft had made (adjusted) profitability promises to their investors , pledges that could be in doubt thanks to COVID-19 and its impacts on traveling. However, earlier this year Uber held a conference with analysts in which it promised that it would not run out on cash , even if ride-hailing cratered and stayed sharply depressed for the rest of the year.

Uber and Lyft shares rose in the wake of the news . Today, the day after Uber’s reported consideration of staff cuts and Lyft’s confirmed staff reductions, the companies are up 6% and 5%, respectively. Investors appear unconcerned that removing staff will harm operations. Indeed, the rising share prices appear more as endorsements of the cuts than as concerns about why they were necessary in the first place. ( TechCrunch dug into Uber’s potential cuts this morning .)

It’s earnings season, with Uber reporting May 7 and Lyft a day earlier on May 6. We’ll know a lot more soon.

Topics

coronavirus , COVID-19 , Layoffs , Lyft , personnel moves , Transportation , Uber , Venture

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Ingrid Lunden

Europe Editor

Ingrid was a writer and editor for TechCrunch, from February 2012 through May 2025, based out of London.

Before TechCrunch, Ingrid worked at paidContent.org, where she was a staff writer, and has in the past also written freelance regularly for other publications such as the Financial Times. Ingrid covers mobile, digital media, advertising and the spaces where these intersect.

When it comes to work, she feels most comfortable speaking in English but can also speak Russian, Spanish and French (in descending order of competence).

View Bio

Alex Wilhelm

Senior Reporter

Alex Wilhelm was a senior reporter for TechCrunch covering the markets, venture capital and startups. He was also the founding host of TechCrunch’s Webby Award-winning podcast Equity.

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