SF food delivery company DoorDash lays off 1,250 people - SFGATE

DoorDash, the food delivery tech company headquartered in San Francisco, announced Wednesday that it would lay off 1,250 employees — about 6% of its staff.

In a message shared with employees and posted on the company’s blog, DoorDash CEO Tony Xu said that the mass layoffs are “the most difficult change to DoorDash that I’ve had to announce in our almost 10-year history.”

“I know that for many of you, today’s news will come as a shock, especially because our business remains strong and continues to grow,” Xu said in the notice.

He explained that the layoffs, as with many other recent high-profile layoffs in the tech industry, are a pullback from “sudden and unprecedented opportunities” for company growth that resulted in too much hiring and increased operational costs. DoorDash, he explained, “was actually undersized as a company” before the pandemic. A DoorDash spokesperson told SFGATE that the company had about 20,000 employees worldwide before the layoffs. (The company had about 8,600 workers worldwide at the start of the year and about 3,900 at the start of 2021, according to SEC filings.)

“While our business continues to grow fast, given how quickly we hired, our operating expenses — if left unabated — would continue to outgrow our revenue,” he added.

Affected employees, according to Xu’s note, will receive 17 weeks’ worth of compensation plus a February 2023 stock vest and health care through the end of March 2023. Employees with H-1B visas will have their layoffs set for March 1, 2023, effectively extending the 60-day timeframe for which workers can find jobs in the United States.

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This news follows high-profile layoffs from the likes of Salesforce, Meta and Elon Musk’s Twitter — but this is the first among the big food delivery services to conduct layoffs this year. Uber (which also owns Postmates in addition to its Uber Eats service) and the Chicago-based Grubhub have yet to conduct layoffs in 2022.

SFGATE food reporter Nico Madrigal-Yankowski contributed to this report.

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