Ride-hailing firm Lyft Inc said it will lay off about 1,072 employees, or 26% of its workforce, in one of the first steps by the new Chief Executive David Risher, sending its shares up by about 1% on Thursday.
Risher, who took over earlier this month, had recently said the company will "significantly" cut jobs, without providing the number of jobs that would be affected.
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Lyft will also eliminate more than 250 open positions and incur about US$41 million to $47 million in costs related to severance and employee benefits in the second quarter, it said in an exchange filing.
It will also take additional costs related to stock-based compensations, which it said cannot be estimated at the time.
The money saved from job cuts will be used to support "service-level improvements" for riders and drivers, Lyft said, promising to offer more details in its first-quarter earnings call on May 4.
This is the second round of job cuts by Lyft, which faces competition from bigger rival Uber Technologies Inc in a slowing economy. It had laid off about 683 employees, or 13% of its then workforce, in November.
Coming off pandemic lows, Uber and Lyft are locked in a battle for market share, and investors worry that Lyft's price cuts to avoid being a distant second in the North American ride-sharing market would squeeze its profit.
Lyft's stock has so far this year lost 8.6% of its value compared with Uber's gain of 20%, as of Wednesday's close.
Reporting by Yuvraj Malik in Bengaluru; Editing by Shailesh Kuber and Arun Koyyur
