Uber is preparing to lay off more than 10% of its employees, marking the largest cut since the COVID-19 era, in response to the growth of driverless taxi services entering the ride-hailing market.
International news agencies reported on 2 Sep 2026 that Uber Technologies plans to lay off about 3,300 employees, or 10% of its total workforce. This represents the largest organizational downsizing since the COVID-19 pandemic, aiming to address the rise of driverless taxi (Robotaxi) services aggressively entering the ride-hailing business.
Dara Khosrowshahi, Chief Executive Officer, said in a memo to employees on Wednesday (2 Sep) that the layoffs will help reduce management layers and organizational complexity, which had expanded rapidly but now hinder decision-making.
Khosrowshahi did not attribute this change to artificial intelligence (AI), although efforts to implement AI for efficiency have driven large tech industry layoffs this year. The site layoffs.fyi reports over 123,000 layoffs across nearly 390 companies.
“A leaner organization means clearer responsibilities, faster decisions, and more time for creative development rather than coordination. It also saves costs, which we intend to reinvest in growth, innovation, and capabilities that will be crucial in the coming years,” Khosrowshahi said.
Uber’s stock rose nearly 2% following the announcement. However, Uber shares, part of the S&P 500 index, have underperformed rivals like Lyft, falling nearly 8% this year amid concerns over increased competition.
Additionally, food delivery platforms such as DoorDash, Instacart, and local delivery services have pressured Uber Eats, prompting Uber to rely on acquisitions like its $14.8 billion purchase of Delivery Hero to expand and strengthen competitiveness.
One concern for Uber is rising tensions with Waymo, the largest driverless taxi operator in the U.S., which offers rides through Uber’s app in Austin and Atlanta.
Meanwhile, Waymo is expanding into new markets independently, as is competitor Tesla, which has doubled investments in driverless taxi services. This intensifies worries that the growing fleet of autonomous vehicles could diminish Uber’s role as a profitable intermediary between drivers and passengers.
To protect its market position, Uber plans to invest over $10 billion in the driverless taxi business in coming years, supporting companies developing autonomous driving systems and positioning itself as a key hub for driverless travel.
This layoff is Uber’s largest since May 2020, when pandemic-driven demand declines forced cuts of 6,700 jobs, nearly a quarter of its workforce.
Uber also faces rising AI-related costs, having spent nearly all its 2026 technology budget within just four months.
Source:cna