In a memo sent to staff on Monday, the CEO of the food delivery platform Grubhub cited a need to preserve “competitiveness” as the reason for laying off about 400 people, which represents approximately 15% of the company’s total employment.
According to the research conducted by Bloomberg Second Measure, the firm has had a difficult time gaining a major portion of the market share, falling far behind rivals such as Uber Eats and DoorDash.
Grubhub has said that it will provide workers with a minimum of 16 weeks’ worth of severance pay, but the company has refused to comment on particular groups or roles that have been impacted.
In his memo, CEO Howard Migdal stated that there is “no doubt whatsoever that we have a solid foundation in place and an immense opportunity ahead of us.” However, it is also clear that we need to make some difficult decisions in order to maintain our competitiveness, deliver the best possible service for diners and our other partners, and be successful over the long term.
Just Eat Takeaway.com, a Dutch multinational corporation, completed its acquisition of the formerly public firm in 2021. The valuation of Grubhub was determined to be $7.3 billion in the all-stock deal.
Just Eat Takeaway said, a little over six months after the transaction was completed, that it was investigating the “partial or full sale” of Grubhub. In response to a question from CNBC about whether or not the layoffs were associated with a prospective sale process, a spokesman for Grubhub did not immediately answer.
