Online food delivery platform DoorDash this week laid off approximately 1,250 workers.

"This is the most difficult change to DoorDash that I've had to announce in our almost 10-year history," co-founder and CEO Tony Xu wrote in a message to employees(Opens in a new window).

The company, which Xu said was "actually undersized" prior to COVID-19, sped up hiring and launched new businesses during the pandemic. And while most of those investments are paying off, according to Xu, the firm was "not as rigorous as we should have been in managing our team growth." Now operating expenses threaten to surpass DoorDash's revenue if left unchecked.

"We have and will continue to reduce our non-headcount operating expenses, but that alone wouldn't close the gap," Xu wrote. "This hard reality ultimately led me to make this painful decision to reduce our team size."

Impacted staffers—who account for about 6%(Opens in a new window) of the entire workforce—will receive 17 weeks of compensation (13 weeks plus a four-week lump sum severance pay), as well as their February 2023 stock vest. All health benefits continue through March, after which employees can opt in and pay for COBRA coverage for up to 18 months.

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A March 1 immigration support termination date has been set, allowing those with visa applications "as much time as possible" to find a new job in the US; folks may also opt in for recruitment support by other companies. DoorDash joins other notable tech companies—including Amazon, Meta, and Twitter—in conducting mass layoffs.

By: DocMemory
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