Lyft said Thursday it is laying off 13% of its workforce as it tries to reduce operating expenses, according to a securities filing.
The ride-hailing company described the cuts as proactive step to ensure it "is set up to accelerate execution and deliver strong business results in Q4 of 2022 and in 2023."
Lyft also reiterated Thursday it is sticking with its previously stated guidance on third quarter 2022 revenues, contribution margin and adjusted EBITDA. It has targeted $1 billion in adjusted EBITDA with more than $700 million in free cash flow for 2024.
Lyft said terminating these 683 employees will cost between $27 million to $32 million in severance and benefits. The company said it expects to record a stock-based compensation charge and payroll tax expense related to restructuring in the fourth quarter and the first quarter of 2023.
The notice comes a few months after Lyft established a hiring freeze, laid off about 60 people and dropped its in-house car rental service. The hiring freeze, which went into effect in August, affects all departments in the U.S. and is expected to last into next year as the ride-hail giant continues to face economic unpredictability.
Lyft is slow hiring in May in order to bring down costs and drive profitability as its stock continues to take a hit. Lyft’s share price has sunk more than 73% since the start of the year at the time of this writing.
Lyft is scheduled to report its third quarter 2022 financial results November 7.