Uber Loses Billions

A exclusively analytical report on Uber's failures as of late. They make it seem implausible that Uber can figure it's way back to making money but that is yet to be seen.
Common Facts
Content (1)
Vox
US New.
The Ver.
Uber lost $5.2 billion in the last three months.
Review Info (3)
First Published: 08/09/2019 08:26:20 pm
Last Updated: 11/30/-0001 12:00:00 am
Content (10)
Uber lost more money this spring then any other quarter.
The company said that almost $4 billion of that amount is due to stock-based compensation.
Even if you exclude that IPO-related cost, the company still lost $1.3 billion.
1.3 billion is 50% more then the second quarter last year.
Their revenue grew by 14% last year.
The $5.2 billion loss size spooked Wall Street
Uber’s shares were down about 5 percent after a few hours.
The company has been nagged by those concerns ever since arriving on Wall Street.
Once anticipated to be valued at as high as $120 billion, public market investors have determined that Uber is now worth only about $73 billion.
That has prompted some criticism of Uber’s leadership.
Opinion (7)
Losses of that size might raise questions on whether it is a sustainable business.
Uber has never been profitable, but it has insisted it could be.
Uber needs several things to happen for them to become more successful.
They need the successful development of autonomous vehicle technology.
They need to box out Uber’s competitors as it grows.
A well run Uber Eats food-delivery business, where customers are fickle.
And the need to ensure that it can keep classifying its drivers as independent contractors rather than employees.
Article Info (4)
Date Published: 11/30/-0001 12:00:00 am
Date Accessed: 11/30/-0001 12:00:00 am
Article Author: Theodore Schleifer
Content (13)
They missed Wall Streets goals sending its shares down 6%.
The company said a price war in the United States was easing.
Uber's second-quarter net loss widened from a loss of $878 million a year earlier.
The report caught investors off guard in part because Uber's smaller rival Lyft Inc on Wednesday had raised revenue expectations and described an easing price war.
Uber reported that revenue growth slowed to 14% to $3.2 billion and fell short of the average analyst estimate of $3.36 billion.
Food delivery Uber Eats grew 72% to $595 million.
Gross bookings, a measure of total value of all services before employee payments rose 31% from a year earlier to $15.76 billion.
Uber is keeping less money per car ride.
Chief Executive Officer Dara Khosrowshahi said in a press call the competitive environment was starting to rationalize and had been "progressively improving" since the first quarter.
This year would be the peak for investment and losses would lessen in 2020 and 2021, he said.
Uber's costs rose 147% to $8.65 billion in the quarter, including a sharp rise in spending for research and development.
Gross bookings for the year would be $65 billion to $67 billion, it said, in line with Wall Street's target of $65.9 billion.
Uber said its monthly active users rose to 99 million globally, from 93 million at the end of the first quarter and 76 million a year earlier.
Opinion (5)
"Losses are widening and the competition is cut-throat," said Haris Anwar, analyst at financial markets platform Investing.com.
"What's sapping investor confidence and hitting its stock hard after this report is the absence of a clear path to grow revenue and cut costs."
"While we will continue to invest aggressively in growth, we also want it to be healthy growth, and this quarter we made good progress in that direction," Chief Financial Officer Nelson Chai said.
The Company has not made it clear if it will make a profit.
They are trying to convince investors that growth will come not only from its ride services, but also from other logistics and food delivery services.
Article Info (4)
Date Published: 11/30/-0001 12:00:00 am
Date Accessed: 11/30/-0001 12:00:00 am
Article Author: Alexandria Sage and Vibhuti Sharma
Content (8)
Uber just reported its second quarterly earnings ever as a public company.
Lyft lost loss of $644 million during the quarter.
When adjusted for things like amortization of intangible assets and stock-based compensation it comes out more favorably.
Uber’s revenue is also growing, but at a slower rate than Lyft.
Len Sherman, adjunct professor of business at Columbia University, seems to think that their business plan is faulty.
"They can’t tax the bars and nightclubs that stay open until 2AM because they know Uber and Lyft will safely transport their passengers home."
"They can’t exploit the positive externalities of their business, but they are held liable for the negative ones."
None of the ride-sharing companies around the world are profitable.
Opinion (9)
"Analysts on Wall Street expected these losses."
Uber's CEO, Dara Khosrowshahi is convinced that there is a $12 trillion “total addressable market” that they have yet to get to.
"Uber is saying it can capture 15 percent of all global economic activity."
"That is sure to excite investors, but it could come as a real cost to the quality of life for the rest of us."
"The more growth Uber and Lyft have 'What does traffic look like then? What happens to our air? Our streets?'"
"There is a traffic crisis in many cities in the US, and Uber and Lyft bear some responsibility."
"Wall Street investors don’t care about externalities like traffic congestion or air pollution, only money."
"Local governments don’t care if Uber and Lyft are profitable."
"But they do care when their streets are choked with traffic or when ride-hailing drivers complain about not being able to meet the basic cost of living."
Article Info (4)
Date Published: 11/30/-0001 12:00:00 am
Date Accessed: 11/30/-0001 12:00:00 am
Article Author: Andrew Hawkins