Due to coronavirus pandemic, Uber lost $2.9 billion in the first quarter and is offloading Jump to Lime to cut costs. But, the company is looking to its growing food delivery business and aggressive cost-cutting to relieve the pain.
“While our Rides business has been hit hard by the ongoing pandemic, we have taken quick action to preserve the strength of our balance sheet, focus additional resources on Uber Eats, and prepare us for any recovery scenario,” said Uber CEO Dara Khosrowshahi in a statement. “Along with the surge in food delivery, we are encouraged by the early signs we are seeing in markets that are beginning to open back up.”
Uber will invest $85 million in Lime as part of the acquisition.
Earlier this week, Uber cut about 3,700 full-time workers or about 14% of its workforce. Lime last month laid off 80 employees, representing 13% of its staff.
In mid-March, Lime pulled scooters from two dozen countries, including the United States, citing public health guidance. The company told the city of Santa Monica that it would permanently halt service effective April 1.
The three other companies have continued to operate with reduced fleets.
The city is planning to approve a second pilot program later this year that will allow two or three companies to operate in Santa Monica.