Lyft Inc. is slowing hiring, cutting budgets and taking other actions as its stock lost another 17% on Tuesday, reaching a 52-week closing low and hovering near its all-time low.
Lyft LYFT, -17.27% President John Zimmer informed employees about the moves Tuesday afternoon, company spokeswoman Jodi Seth confirmed. They include giving “eligible employees a special stock grant” but no layoffs, she said.
“We’re focused on accelerating profitable growth and prioritizing work across the company that contributes the most to this,” Seth said. “We’re also being responsible about costs and will significantly slow hiring.”
The ride-hailing company’s stock has been on a roller-coaster ride since it reported first-quarter results in early May. Lyft shares sank nearly 30% the day after executives issued a lower-than-expected forecast for the second quarter and said they intended to continue to spend on driver incentives and marketing as they prepared to meet more demand.
Since then, the company’s shares have fallen eight out of 15 trading days, closing Tuesday at $16.72, shy of their all-time closing low of $16.05 on March 18, 2020. Lyft stock is on pace for its worst month on record and has decreased about 61% so far this year, according to Dow Jones Market Data.
The cost-cutting moves by Lyft follow those announced by larger rival Uber Technologies Inc. UBER, -9.38% earlier this month, when Uber Chief Executive Dara Khosrowshahi reportedly emailed his employees and cited a “seismic shift” in the stock market as the reason the company needed to react. Uber shares fell more than 9% on Tuesday, closing at $21.55, and are down almost 49% year to date.