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Uber CEO vows to be 'hardcore about costs,' slow down hiring in memo to employees:
Uber is going to slow down hiring and reduce its costs in response to "seismic shifts" in the financial markets, Uber CEO Dara Khosrowshahi said in a memo to employees.
[...] Uber is the latest company to commit to a hiring slowdown as the labor market tightens and tech stocks in particular have plunged sharply from their heights at the beginning of the COVID-19 pandemic. Meta, the parent company of Facebook, also said it would slow down the pace of hiring for mid-level positions.
Uber will now focus on achieving profitability on a free cash flow basis rather than adjusted earnings before interest, taxes, depreciation, and amortization, Khosrowshahi said, noting that is what the company's investors now expect.
Uber has long been criticized based on the way it calculates its adjusted profits. The company's definition of EBITDA includes an unusually large list of exclusions and is widely seen as an inaccurate measure of the company's overall profitability. The company's stock price is down more than 40 percent year-to-date.
Uber to 'Treat Hiring as a Privilege' as a Way to Cut Costs:
In an email to staff, Uber CEO Dara Khosrowshahi outlined some new and not-so-new cost saving measures.
[...] The rideshare giant is the latest in a string of other tech companies announcing hiring slow downs or cuts. At the end of April, investing app, Robinhood, laid off 9% of its staff. Then, Netflix laid off multiple recently hired writers for blog endeavor Tudum following a dismal quarterly earnings report. And, last week, Meta announced a hiring freeze for the rest of the year.
(Score: 3, Interesting) by Freeman on Wednesday May 11 2022, @02:49PM (14 children)
Guess I would have heard something, if they'd finally bit the dust. As things stand, it sounds like they're still bleeding money, thus the "cost saving measures".
Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
(Score: 2) by DeathMonkey on Wednesday May 11 2022, @02:59PM (7 children)
That's what I was wondering... Have they actually made any money yet or are they trying to now pivot their position into a profitable one?
(Score: 4, Informative) by janrinok on Wednesday May 11 2022, @03:26PM (4 children)
You only have to read the linked stories.
(Score: 4, Insightful) by FatPhil on Wednesday May 11 2022, @03:54PM (2 children)
You also have to be careful about exactly which number they're saying is positive: "cash flows" isn't precise enough. Almost all of the numbers that business people like to bounce around in order to pretend they're making a profit are used to hide the fact that they actually aren't. There's a reason the bottom line is called the bottom line. All those fluffy EBITDA-alike "positive earnings" don't mean shit when it comes to the bottom line. They're there to deceive.
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2, Interesting) by Anonymous Coward on Wednesday May 11 2022, @04:03PM (1 child)
Uber is actually particularly bad with this. they tend to quote "Adjusted EBIDA" where adjusted means "excluding all the expenses and including unrealized gains we should not be including"
(Score: 1, Insightful) by Anonymous Coward on Wednesday May 11 2022, @04:50PM
Sounds like all those tax cuts that will "pay for themselves."
(Score: 5, Funny) by DeathMonkey on Wednesday May 11 2022, @05:53PM
That would require a great deal more interest in Uber than I can currently scrounge up!
Thanks for doin' it for me.
(Score: 1, Informative) by Anonymous Coward on Wednesday May 11 2022, @04:01PM
Here is some great reading on that subject https://www.nakedcapitalism.com/category/uber [nakedcapitalism.com]
(Score: 3, Funny) by Opportunist on Wednesday May 11 2022, @07:28PM
Sure, why do you think the CEO is still...
Oh, you mean the company, not the moochers on top? No, of course not.
(Score: 2) by ikanreed on Wednesday May 11 2022, @03:01PM (4 children)
"But what if we keep growing forever and never concern ourselves with making real profit"
--Hundreds of tech startup founders who were treated like a business genius just like... 2 years ago.
(Score: 2) by FatPhil on Wednesday May 11 2022, @03:43PM (3 children)
Everyone and their goat wanted to start a microbrewery 5-10 years ago (exact timescale depends on the country, obvs.), and the market started to get flooded. About half simply can't find a large enough slice of the market, and fold. The other half, starting with big loans usually, have the sales to show that there's some potential for profit eventually, if only they could carve out a bigger slice of the market. Alas, they don't have the capacity to satisfy a greater want, so need to expand. Some hit the crowdfunding route here, but all have to take on bigger bank loans, as crowdfunding only takes you so far - a thousand idiots with a hundred dollars each barely buys you anything, professional brewkits are expensive. Now they have the problem of more expenditure (increased staff, as well as interest payments), and that winning line of actually making a profit zooms back out of sight again. The Darwinian cycle turns again, and for the survivors it's generally lather, rinse, repeat. Some are lucky, and they could stop the loop and just start taking profit next year, but those are the ones running at capacity constantly, money rolling in, and - yup - the greatest incentive to *not* stop the loop.
Maybe 5% finally escape the loop intact. I'm not 100% sure, as in the 4 countries I'm most familiar with, I don't think I know even one who's attained that elevated state presently, despite knowing dozens running round ever growing hamster wheels. (And dozens that have gone bust. There is another way out - sell up, of course, but that makes the issua a bit of a Ship of Theseus.)
Perhaps it's because of the easy access to capital that this kind of risky behaviour is embarked upon in a wide range of sectors, but you generally can't artificially raise the barrier to entry without also harming the ability for the ecosystem to flourish. Perhaps put more onus on the banks to vet business plans more fastidiously, and not treat a "plan" as a trustworthy prediction - "our research shows there's a market" is worth shit 99% of the time, you're simply rewording "trust us".
And in case you're interested, yeah, the brewpub's doing great, thanks for asking; exporting to dozens of countries now - just need to extend the facility and get some bigger tanks to keep up with demand...
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2, Interesting) by Anonymous Coward on Wednesday May 11 2022, @04:57PM (2 children)
I don't know if you remember, but craft brewing went through this phase in the 90s. Following on the successes of Sam Adams in particular, and the renewed interest in home brewing, everybody and their brother (especially if their brother was an MBA) opened a brewpub. And since a lot of them had MBAs behind them, they were content in putting out a mediocre product and they were a means to an ends, a gimmick for a restaurant, and a lot of them disappeared by the early 2000s. Does this mean I should stash away my independent contractor rider business plan and wait to pull it out in about 15 or 20 years when these current ideas become new again? :)
(Score: 2) by FatPhil on Wednesday May 11 2022, @08:53PM
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by DeathMonkey on Wednesday May 11 2022, @09:38PM
Either that or move to Colorado. The damn things are like vermin around here!
(Score: 0) by Anonymous Coward on Wednesday May 11 2022, @08:22PM
i wonder if they still have their rock walls and beer taps going?
Gotta love the statement: we're going to start only hiring people we need