Lyft ($NASDAQ:LYFT) is trimming 90 staffers from its headcount, making it the latest startup to reverse course on growth ambitions and scale back on marketing staffers in light of a challenging stock market performance.
It's a painful reminder for startups that the failure to match heady growth expectations often comes with difficult repercussions, and the layoffs could be the least of the headaches Lyft's remaining team has in 2020.
The company insists it's on the verge of turning a profit, and that it will add staff this year. Alternative data may not leave investors too optimistic.
To go along with the cuts, and the decline in stock price, Lyft job postings are down more than 37% from their October 2019 peak.
It's certainly no new news when a highly-touted startup has to scale back on its growth ambitions - 2019 proved challenging for many unicorns after flashy IPOs, and they were forced to pull back on spending - whether or not they've even made it public. The most stark example of a white-hot app being confronted by an ice-cold market reception, of course, is WeWork, which had to yank thousands of job postings as it readied for thousands more in staff cuts.
But others - like Uber, Lyft's biggest competitor, have suffered similar fates as they recalibrated growth plans to keep analysts and investors happy on a quarterly basis. When Lyft announces earnings February 11, analysts are expecting losses of -$1.22 per share.
And while Lyft may be hurting on staffing, and in the eyes of analysts, it's still making progress on several fronts digitally.
Lyft's Apple Store average rating is nearly 4.8 out of 5, an extremely high satisfaction score with consumers - and, what's more, 7.5 million users have submitted ratings in the Apple Store for Lyft's app (not shown). That doesn't even factor in Google Play store stats - and it's a sign that Lyft is continuing to have stickiness with its user base. Whether or not it can right-size spending to offset losses, is a different story - and probably, for a different earnings report.
About the Data:
Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales, and app ratings - and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.