Tony Xu, co-founder and chief executive officer of DoorDash Inc., smiles during the Wall Street Journal Tech Live conference in Laguna Beach, California, U.S., on Tuesday, Oct. 22, 2019.
- CEO Tony Xu told employees that 1,250 corporate workers would be let go as part of a broader cost-cutting initiative.
- In a message released to the public, Xu offered 17 weeks severance and 2023 vesting as part of the severance package.
Delivery service DoorDash is laying off 1,250 corporate workers as part of a continued cost-cutting effort, driven by tapering growth and overhiring, CEO Tony Xu said in a message to employees on Wednesday.
The company's shares closed up over 9.2%.
DoorDash joins the ranks of Amazon, Meta, Twitter, HP and Lyft in imposing job cuts. Tech industry hiring ballooned during the Covid pandemic and has seen a harsh comedown in recent months as interest rates mute consumer demand and investor confidence.
It had 8,600 corporate employees as of Dec. 31, 2021.
DoorDash went public at the end of 2020 in a wildly successful IPO that saw shares soar 80% over initial pricing. In November 2021, it hit a peak valuation of $81.1 billion, despite never turning a profit.
Money Report
DoorDash will offer 17 weeks of severance to affected employees. Health care will continue through March 2023. For overseas or visa-sponsored employees, the termination date will be March 1, a decision that Xu told employees would give them "as much time possible to find a new job."
DoorDash shares are down just under 60% year to date.
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Correction: DoorDash did not previously announce a hiring slowdown.
