DoorDash Cuts Staff by 1,250 to Rein in Costs
DoorDash says its business remains strong and more resilient than other e-commerce companies.
Photo:
ANDREW KELLY/REUTERS
DoorDash Inc.
DASH 6.00%
is cutting corporate staff by about 1,250, or 6% of head count, as the food-delivery company works to rein in costs after a pandemic-fueled growth spurt, according to an internal memo from Chief Executive
Tony Xu.
“We were not as rigorous as we should have been in managing our team growth,” Mr. Xu said in the memo, which was viewed by The Wall Street Journal. “That’s on me. As a result, operating expenses grew quickly.”
Growth has tapered from pandemic highs, Mr. Xu said, and operating costs would continue to outpace sales growth if left unaddressed. He also said the business remains strong and more resilient than other e-commerce companies.
“We have and will continue to reduce our non-headcount operating expenses, but that alone wouldn’t close the gap,” he said.
Bloomberg News earlier reported on the layoffs.
Those impacted by the layoffs in the U.S. will receive 13 weeks of compensation, plus one four-week lump-sum severance payment, the memo said. They will also receive their scheduled Feb. 28 stock vest, among other benefits into the new year, according to the memo.
Shares of DoorDash rose more than 3% to $55.20 in premarket trading.
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
DoorDash says its business remains strong and more resilient than other e-commerce companies.
Photo:
ANDREW KELLY/REUTERS
DoorDash Inc.
DASH 6.00%
is cutting corporate staff by about 1,250, or 6% of head count, as the food-delivery company works to rein in costs after a pandemic-fueled growth spurt, according to an internal memo from Chief Executive
Tony Xu.
“We were not as rigorous as we should have been in managing our team growth,” Mr. Xu said in the memo, which was viewed by The Wall Street Journal. “That’s on me. As a result, operating expenses grew quickly.”
Growth has tapered from pandemic highs, Mr. Xu said, and operating costs would continue to outpace sales growth if left unaddressed. He also said the business remains strong and more resilient than other e-commerce companies.
“We have and will continue to reduce our non-headcount operating expenses, but that alone wouldn’t close the gap,” he said.
Bloomberg News earlier reported on the layoffs.
Those impacted by the layoffs in the U.S. will receive 13 weeks of compensation, plus one four-week lump-sum severance payment, the memo said. They will also receive their scheduled Feb. 28 stock vest, among other benefits into the new year, according to the memo.
Shares of DoorDash rose more than 3% to $55.20 in premarket trading.
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
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