- Days after Uber laid off about a quarter of its workforce, one of its senior executives — marketing leader Jill Hazelbaker — sold more than half of her stake of Uber shares for $8.6 million.
- Employees have been chattering about the sale internally, not only because of its timing but because of its size, with some speculating it could mean that Hazelbaker is planning on leaving the company.
- But a source familiar with the matter tells Business Insider that the sale occured because Hazelbaker is the longest running Uber exec who has never cashed out and one year after the company’s IPO was her first opportunity to sell.
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Days after Uber conducted its second big round of layoffs to trim its workforce by about 25%, Uber’s senior vice president of marketing and public affairs sold half her Uber stake for a total of $8.6 million, according to documents filed to the SEC.
Jill Hazelbaker’s stock sale was unusual for a lot of reasons. For one, this was not a pre-scheduled stock trade, meaning that it wasn’t part of a pre-arranged “Rule 10b5-1 plan,” where insiders set up a schedule to sell stock in advance. Those kinds of plans give insiders a way to sell stock without violating insider trading laws or looking like they’ve lost confidence in the company.
While Hazelbaker’s trade wasn’t scheduled, it was, however, pre-cleared through Uber’s legal department and not a last-minute decision, according to someone familiar with the matter.
The sale was also unusual because of its size. Between May 21 and 25, Hazelbaker conducted four transactions that sold 250,000 shares out of her tranche of 436,680 shares, or 57% of her total holdings. She sold for between $34.38 and $35.93, thus capitalizing on a bump in Uber’s share price that occured after the layoffs. Uber shares have been generally trending up since the first round of layoffs on May 6 and are currently priced at about $34. While that’s higher than they’ve been in the past few months, it’s still off the stock’s 52-week high of $47 back in 2019.
Finally, it was unusual because Uber execs have not been selling much of their stock in 2020 as the company has been grappling with the COVID-19 economic crises, although they have been granted more stock. In February and March, board members and executives were issued their lastest tranches of stock grants. For instance, Hazelbaker was issued 114,495 shares in February and another 117,004 in March.
In comparison, CEO Dara Khosrowshahi was issued 629,722 shares in February and two more grants in March for 162,506 and 31,024 shares. He now owns 864,750 shares according to the latest filing in March and hasn’t sold any in 2020. Khosrowshahi also gave up his cash salary in May for the rest of the year in solidarity with the laid off workers. For what it’s worth, Khosrowshahi had become a millionaire from his previous role as CEO of Expedia.
Even Pham Thuan, the Chief Technology Officer who resigned this month as layoffs ravaged the company, hasn’t yet sold any stock in 2020. As of the latest filing on May 5, he owned over 4.5 million shares. However, Thuan did sell $2 million worth of shares in secondary offerings before the company went public, according to SEC filings.
Employees have been chattering internally about the optics of Hazelbaker’s $8.6 million sale during a global pandemic as the company’s revenues have tanked and about 10,000 Uber employees have been laid off. Some are saying it shows she doesn’t have confidence in the company or, perhaps, that she’s getting ready to leave, one former employee still in touch with current coworkers told Business Insider.
But a source familiar with the trades offered a different explanation, saying that Hazelbaker is the longest-running executive that has never cashed out of her shares in a previous secondary offering. She’s been at the company for five years and is the last remaining exec who served under former CEO Travis Kalanick.
She felt like this was her first chance to sell shares since the IPO a year ago, the person familiar said.
“She’s got two kids and a third one one the way, so it seems like this chatter is confusing a personal financial choice with a career choice and that’s not fair,” according to this person.
Cofounder Garrett Camp has sold $69.6 million since the pandemic hit
There’s only one other Uber insider who has been cashing out shares by the millions during the pandemic: cofounder Garrett Camp. Since last fall (when Uber also had layoffs), he’s divested 44% of his massive stake, which included selling $210 million worth of shares and giving away thousands of shares, too, according to SEC records compiled by Sqoop. Camp has signed the Giving Pledge vowing to give away most of his wealth to charity, he has his own charitable foundation, and he runs a startup incubator, Expa Studios.
Since January, 2020, he’s sold $145.4 million worth of shares, with $69.6 million sold since March — when the pandemic began shutting down much of the US — and $14.7 million on May 7, the day after Uber’s first big layoff this month.
However, Camp’s sale is different from Hazelbaker’s in that it — as well as the rest of them — was part of a pre-arranged, Rule 10b5-1 plan.
On March 31, Camp announced he was resigning from his voting position on Uber’s board by not running for election at the annual shareholder’s meeting held earlier this month. He’s become a board observer, advising on products, as he focuses on his startup incubator and looks for his next big thing.