[Asia Economy Reporter Jeong Hyunjin] Following ride-sharing company Uber, Lyft has also taken steps to cut costs and freeze hiring. This change comes amid growing concerns about a recession due to the Federal Reserve's tightening monetary policy and soaring inflation, which have led to a sharp decline in tech stocks.
According to the Wall Street Journal (WSJ) on the 24th (local time), Lyft CEO John Zimmer recently sent a memo to employees stating, "We have discussed with other business leaders how to respond to concerns related to the recession and the rapid shift in investor sentiment."
Zimmer said, "Considering that the recovery is slower than expected and that we need to accelerate the impact of our business, we have made the difficult but important decision to significantly reduce employment in the United States." He added that there are currently no plans for layoffs but emphasized that priority will be given to positions supporting essential business operations.
WSJ reported that Lyft's board held a meeting on the 20th to discuss cost-cutting measures, and some employees within Lyft have recently started receiving signals about cost reductions and hiring slowdowns.
After this news was released, Lyft's stock price fell by 17.27% in a single day. Lyft's stock has plummeted more than 60% since the beginning of this year.
Earlier, Uber also announced on the 8th that it would cut costs and reduce new hiring. Dara Khosrowshahi, Uber's CEO, said in an email to employees that there had been a seismic shift in investor sentiment and that the company would focus on becoming more efficient through cost reductions. He emphasized significantly cutting marketing and incentive expenses and taking a cautious approach to hiring.
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