Uber lays off 10% of support staff, ends remote work, and blames AI for the first time

Uber has cut 10% of the roles inside its customer service operations, and for the first time the company is putting artificial intelligence at the centre of the explanation. The reductions hit the community operations team and were announced internally on Wednesday, with an Uber spokesperson telling Bloomberg the company is working to simplify operations, strengthen in-person collaboration and continue to embrace AI. Remote employees on that team have also been told to relocate to a hub office, in line with Uber's return-to-office mandate.The memo that landed with the cuts was blunt about why. "Our organization has become too complex and siloed," Megha Yethatika, Uber's vice president of global community operations, wrote to her division. The department has made progress on AI, she said, but unlocking that potential needs the right structure underneath it. "We cannot scale frontier technology on top of fragmented processes."These are the second round of layoffs at Uber after the company cut 23% of HR jobs two months agoThis is Uber's second restructuring in less than two months. In June, the company cut 23% of its people division—less than 1% of its 34,000 global employees—after a new president took over. What makes this round different is the framing: Uber has trimmed teams before, but never with AI efficiency named as the driver. That puts it alongside Block and Oracle, both of which have cited AI while announcing job cuts this year.The company said in May it would slow hiring because of internal AI use. Hiring hasn't stopped, though. More than 500 roles are still listed on Uber's jobs page, including engineering positions supporting its robotaxi partnerships.Uber's AI bill has been climbing faster than its resultsThe layoffs land against a backdrop of Uber spending heavily on AI and struggling to prove what it's buying. The company burned through its entire 2026 Claude Code budget in four months, a disclosure CTO Praveen Neppalli Naga made in April. Per-engineer bills typically ran $150 to $250 a month, with heavy users hitting $2,000. Neppalli Naga himself spent $1,200 worth of tokens during a single two-hour demo.Uber has since capped spending at $1,500 per employee per month for each agentic coding tool. COO Andrew Macdonald has been openly sceptical, saying it's hard to draw a line between rising token consumption and useful features shipped to riders and drivers. He also warned that token costs would eventually be weighed against headcount—a trade-off that now looks less theoretical.Uber has had some wins. Its "agentic pods" programme, which embedded 30 AI-proficient engineers across finance, legal and HR, cut financial pacing reports from two days to 10 minutes.Get the latest technology news and updates. Download the TOI App.