Long-term, Labour needs voting reform (PR). The only way they can win any GEs now (with the rise of SNP), is with once-per-century type collapses like we are seeing from the Tories right now. Even with this mess, I think Labour will struggle to win a majority at the next GE, because that's just how stupid middle-England is. But that could be a blessing in disguise as others have said - Labour have already ruled out a pact with SNP, but if they are 5-10 short of a majority and form a coalition with LibDems, then they could push voting reform through the Commons. Hopefully once its in, it can never be reversed - and if so the UK will be a much better place in the coming decades.
On the other hand, if Labour somehow win a small majority (5-10 seats) then it would be difficult for them to suddenly bring up PR, and then by the following election the status quo (ie Tory majority) will return.
But Labour and the Lib-dems should do whatever back-room shenanigans they need to, to share power at the next GE. It would literally be better for Labour (long-term) to have 300 seats + Lib Dem 50 than 330 + 20.
Edit: even better if they shoe-horn a reverse Brexit bill too