Shares were up about 3% in premarket trading on the news.
DoorDash announced a slowdown in hiring earlier this year. It had 8,600 corporate employees as of Dec. 31, 2021.
DoorDash went public at the end of 2020 in a wildly successful IPO that saw shares soar 80% over initial pricing. In November 2021, it hit a peak valuation of $81.1 billion, despite never turning a profit.
DoorDash will offer 17 weeks of severance to affected employees. Healthcare will continue through March 2023. For overseas or visa-sponsored employees, the termination date will be Mar. 1, a decision that Xu told employees would give them “as much time possible to find a new job.” DoorDash will set a termination date of March 2023 for H1-B visa holders, allowing overseas workers as much time as possible to find a new opportunity.
DoorDash shares are down over 60% year-to-date.