US delivery firm Instacart to cut 7% workforce, 250 employees

By Ovunc Kutlu

ISTANBUL (AA) - American delivery firm Instacart will cut 7% of its workforce, or 250 employees, according to a US Securities and Exchange Commission (SEC) filing on Tuesday.

"On February 9, 2024, the Board of Directors of the Company approved restructuring actions with respect to its workforce to improve operational efficiencies and better align the Company’s organizational structure with current business needs, top strategic priorities, and key growth opportunities," said the filing.

"The Restructuring Plan includes a reduction of approximately 250 employees, representing approximately 7% of the Company’s global workforce as of January 31, 2024, with most of these reductions expected to occur by March 31, 2024. Any local separations will be determined at the time and as required by any local consultation or process requirements," it added.

The company said it estimates to incur around $19 - $24 million in connection with the restructuring plan, mostly related to cash expenditures for severance payments and employee benefits.

In addition, Chief Operating Officer Asha Sharma informed the company of her decision to resign from her position, effective March 1, said the statement.

"The Company does not plan to hire or appoint a new Chief Operating Officer at this time," it added.

Instacart had its initial public offering in September last year, raising $660 million, while the company's value was around $10 billion.

Its stock price was down 3.84% at 9.37 a.m. EDT Wednesday on the Nasdaq, with a market cap of $7.51 billion.

The San Francisco-based firm operates a grocery delivery and pick-up service in the US and Canada.

Dozens of companies in the US technology sector have been cutting jobs since the final quarter of last year as they struggle with lower income and falling advertisement revenue.

Snap, DocuSign, Uber, Reddit, Disney, 3M, Amazon, Yahoo, Affirm, Zoom, Dell, IBM, Microsoft, Salesforce, PayPal and Google's parent company, Alphabet, have laid off workers by the thousands since the last quarter of 2023.