Uber Reportedly Plans To Slash 10% Of Its Workforce — Wells Fargo Says The Move Could Unlock $580M In Cost Savings

Wells Fargo said Uber’s job cuts create a healthy buffer for its forecast of a 30-basis-point year-over-year margin improvement in 2027.

• Wells Fargo reiterated its ‘Overweight’ rating and $89 price target, according to TheFly.
• According to a Bloomberg report on Wednesday, Uber plans to cut about 3,300 jobs, roughly 10% of its global workforce.
• Uber reportedly plans to reinvest the savings into growth, innovation and its push into autonomous vehicles.

Wells Fargo on Wednesday said that Uber’s (UBER) reported job cut plans could provide a meaningful boost to its earnings next year, as the ride-hailing giant bets big on its autonomous mobility business.

The firm estimates the job cuts could generate about $580 million in annual cost savings. Wells Fargo said the move creates a “healthy buffer” for its forecast of a 30-basis-point year-over-year margin improvement in 2027 and could drive upside to earnings.

The firm added that it does not view the restructuring as a sign of weakening business fundamentals. It kept an ‘Overweight’ rating and an $89 price target, according to The Fly. This represents a 16% upside potential from current levels.

At the time of writing, UBER shares were up 1.7%.

What’s Behind The Job Cuts

According to a Bloomberg report on Wednesday, Uber plans to cut about 3,300 jobs, roughly 10% of its global workforce. In an email viewed by Bloomberg, CEO Dara Khosrowshahi said Uber’s rapid growth had created too many layers, fragmented ownership and structures that no longer worked efficiently at its current scale.

Uber reportedly plans to reinvest the savings into growth, innovation and its push into autonomous vehicles.

“The changes we’re making today are designed to do two things: make Uber simpler and faster, and create more capacity to invest in our future. A leaner organization will mean clearer ownership, faster decisions, and more time spent building rather than coordinating,” the email read.

“It will also generate savings that we intend to reinvest in growth, innovation, and the capabilities that will matter most over the coming years.”

Uber’s Robotaxi Push

The job cuts come as the race for robotaxis heats up. Earlier this year, Uber announced plans to commit more than $10 billion in robotaxi partnerships.

The company has partnered with Pony.ai to launch autonomous taxi services in Europe and has partnered with WeRide for commercial robotaxi services in Europe and the Middle East. Uber already has partnerships with Alphabet’s (GOOG, GOOGL) Waymo and Amazon’s (AMZN) Zoox.

Retail’s Take On UBER

Meanwhile, retail sentiment surrounding UBER remained ‘bearish’ over the past 24 hours.

One user stated that such moves “could define UBER over the next decade.”

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UBER shares have declined more than 6% so far this year.

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