DoorDash will lay off 1250 employees in corporate America

DoorDash announced Wednesday that it would lay off approximately 1,250 employees due to its rapid growth during the pandemic. This makes it the latest tech company in recent weeks to make staff cuts.

According to a spokesperson for DoorDash, the reductions represent approximately 6% of DoorDash employees.

Tony Xu, CEO of DoorDash, shared the news with staff Wednesday morning in a memo. He called it “the most difficult change to DoorDash” in almost 10 years.

“If you’re among the impacted, I am truly so sorry. I also apologize that some of you have to wake up to receive this news rather than reading it during normal hours,” Xu said.

DoorDash, like other tech companies, experienced a pandemic boom when more people embraced online delivery and avoided restaurants and stores during the crisis. Xu stated that DoorDash had “accelerated our hiring to catch up with our growth” and launched many new businesses as a result of feedback from its customers.

Xu stated that “most of our investments have paid off,” but he added that “we weren’t as strict as we should have been in managing team growth.” Operating expenses increased quickly as a result.

Recent layoffs in the tech sector have been widespread due to rising inflation, recession fears, and shifts in pandemic demand. Meta, Twitter, and Amazon all announced job cuts. Some of the companies’ heads admitted to misinterpreting pandemic demand.

Xu acknowledged the changing economic climate in his memo. He wrote, “We are also not immune to external challenges and growth is tapering vs our pandemic rate of growth.”

DoorDash shares are down by more than 60% this year.

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