Uber will cut back on spending and focus on becoming a leaner business to address a “seismic shift” in investor sentiment, CEO Dara Khosrowshahi told employees in an email obtained by CNBC.
“After earnings, I spent several days meeting investors in New York and Boston,” Khosrowshahi said in the email, which was sent out late Sunday. “It’s clear that the market is experiencing a seismic shift and we need to react accordingly.”
Tech stocks have plunged sharply from the highs of the coronavirus pandemic, as investors fret over the prospect of an end to the era of cheap money that defined a historic bull market. The Nasdaq Composite recorded its fifth consecutive week of declines last week, its longest weekly losing streak since 2012.
To address the shift in economic sentiment, the ride-hailing firm will slash spending on marketing and incentives and treat hiring as a “privilege,” Khosrowshahi said.
“We have to make sure our unit economics work before we go big,” the Uber boss wrote. “The least efficient marketing and incentive spend will be pulled back.”
“We will treat hiring as a privilege and be deliberate about when and where we add headcount,” he added. “We will be even more hardcore about costs across the board.”
It makes Uber the latest tech company to warn of a slowdown in hiring. Facebook parent company Meta last week told staff it would stop or slow the pace of adding midlevel or senior roles, while Robinhood is cutting about 9% of its workforce.
Uber shares sank about 2.5% in U.S. premarket trading. The stock is down more than 40% year-to-date.CNBC