Lyft to furlough hundreds, cut 17% of staff because of pandemic

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NEW YORK, NY – MARCH 19: A Lyft logo is displayed on a vehicle driving through Times Square, March 19, 2019 in New York City. Lyft, the popular ride-hailing service and competitor to Uber, is planning its initial public offering (IPO) on the NASDAQ stock exchange in the coming weeks. Lyft is projecting investors will buy the stock for between $62 and $68 per share, with the company expecting to raise over $2 billion through the sale of stock. (Photo by Drew Angerer/Getty Images)

Lyft plans to cut nearly 1,000 staffers and furlough hundreds more as it grapples with the impact of the ongoing pandemic on people using its ride-hailing services.

The company, which went public about a year ago, said in a filing Wednesday that it plans to cut 17% of its workforce, or 982 employees. It has also furloughed about 288 employees on top of that.

In the filing, Lyft cited the downsizing as a means of curbing operating expenses and adjusting its cash flow “in light of the ongoing economic challenges resulting from the COVID-19 pandemic and its impact on the company’s business.”

Additionally, Lyft is implementing salary reductions for many employees, including a 30% cut for executive leadership and 20% for vice presidents.

The news comes one day after tech news site The Information reported that rival Uber is weighing significant staff cuts as well. In a statement to CNN Business about the reported layoff discussions, an Uber spokesperson said: “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.”

Both companies have a history of steep losses and went through layoffs prior to the pandemic.

Lyft has been attempting to shift toward delivery, an area it had not previously embraced — unlike Uber, which has its Eats food delivery service. Weeks ago, recognizing the decline in ride activity spurred by the public health crisis, Lyft advised drivers to consider pursuing driving work with Amazon.

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