DoorDash to lay off 1,250 corporate employees
By Catherine Thorbecke, CNN BusinessUpdated: Wed, 30 Nov 2022 15:29:34 GMTSource: CNNDoorDash on Wednesday said it will lay off about 1,250 corporate employees after growing its team too quickly durinBy Catherine Thorbecke, CNN Business
Updated: Wed, 30 Nov 2022 15:29:34 GMT
DoorDash on Wednesday said it will lay off about 1,250 corporate employees after growing its team too quickly during the pandemic, making it the latest tech company to cut staff in recent weeks.
The cuts represent about 6% of DoorDash's staff, according to a company spokesperson.
DoorDash CEO Tony Xu shared the layoff news in a memo to staff early Wednesday, calling it "the most difficult change to DoorDash that I've had to announce in our almost 10-year history."
"If you are among those impacted, I am truly sorry and I apologize to have some of you wake up to this news as opposed to reading it during more normal hours," Xu added.
Like other tech companies, DoorDash experienced a pandemic boom as more consumers embraced online deliveries and shied away from stores and restaurants amid the health crisis. Xu said that DoorDash "sped up our hiring to catch up with our growth and started many new businesses in response to feedback from our audiences."
While "most of our investments are paying off," Xu wrote, "we were not as rigorous as we should have been in managing our team growth." He added: "That's on me. As a result, operating expenses grew quickly."
A wave of layoffs have spread throughout the tech industry recently as companies react to rising inflation, looming recession fears, and a shift in pandemic demand. Meta, Twitter, and Amazon have all announced significant job cuts, with the heads of some of these companies admitting to misreading pandemic demand.
In his memo, Xu nodded to the shifting economic climate. "We too are not immune to the external challenges and growth has tapered vs our pandemic growth rates," he wrote.
Shares of DoorDash are down more than 60% so far this year.