Uber CEO vows to be ‘hardcore about costs,’ slow down hiring in memo to employees

Photo by Philip Cheung for The Verge

According to a memo sent to employees that was first reported by CNBC, the CEO of the company vowed to rein in costs in the face of aseismic shift in the financial market.

In response to the dramatic upheaval in the labor market, the effort to reduce spending is being made. The company will treat corporate hiring as a "privilege" as it tries to become a leaner operation, according to the company's CEO.

As the labor market tightens and tech stocks plunge from their highs, companies are resorting to a hiring slowdown. Meta said it would slow down the pace of hiring for mid-level positions.

The company will focus on achieving profitability on a free cash flow basis, rather than adjusted earnings before interest, taxes, depreciation, and amortization.

The way in which it calculates its adjusted profits has long been criticized. A large list of exclusions is included in the company's definition of EBITDA, which is seen as an inaccurate measure of the company's overall profitability. The company's stock price is down more than 40 percent this year.

Meeting the moment means making trade offs. Some initiatives that require substantial capital will be slowed. Before we go big, we have to make sure our economics work.

The least efficient marketing and incentive spend will be pulled back. We will be deliberate about when and where we add headcount. We will be more focused on costs across the board.

The authenticity of the memo was confirmed by an employee of the company.

In its first-quarter earnings last week, it reported a $5.9 billion loss, which it said was largely due to equity investments in other mobility companies. The company says it expects to post positive cash flows for the entire year in 2022, which would be the first of its kind.