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posted by martyb on Monday February 19 2018, @10:36AM   Printer-friendly
from the who-needs-profits? dept.

Adjusted net revenue last quarter increased 61 percent to $2.22 billion from the same period in 2016. Meanwhile, the total value of fares grew to $11 billion that quarter. It was the first full quarter under Dara Khosrowshahi, who took over the troubled business in September.

Despite a turbulent year for the ride-hailing company, sales were $7.5 billion. But the company also posted a substantial loss of $4.5 billion. There are few historical precedents for the scale of its loss.

Uber isn't publicly traded but has chosen to release select financial information to investors and the public in recent quarters. Last month, SoftBank Group Corp. led a $9.3 billion investment deal to make itself largest shareholder in the San Francisco-based company. The Japanese firm is betting that more people will choose to book rides through an app instead of driving themselves and that the business will find a way to make up for losses today.

The latest financial report shows the company continues to increase its revenue while making progress on cutting its loss. Uber's loss is based on generally accepted accounting principles, which includes writedowns, as well as the company's enormous legal expenses, such as the cost of defending against a trade secrets lawsuit from Alphabet Inc.'s Waymo. Uber agreed to give Waymo stock valued at $245 million to settle the suit last week.

[...] Uber hasn't made it easy to compare last year's financials to years past. The company declined to disclose complete data for 2016 and over time has changed how it accounts for revenue. Uber lost billions in China before selling its business there in 2016 in exchange for a 17.5 percent stake in homegrown rival Didi Chuxing.


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  • (Score: 2) by c0lo on Monday February 19 2018, @11:32AM (7 children)

    by c0lo (156) Subscriber Badge on Monday February 19 2018, @11:32AM (#640055) Journal

    No seriously. I don't say it's not potentially intersting, I say the interest in this story escapes me.
    Maybe someone can explain it?

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  • (Score: 2, Informative) by khallow on Monday February 19 2018, @04:00PM (4 children)

    by khallow (3766) Subscriber Badge on Monday February 19 2018, @04:00PM (#640123) Journal
    One thing is that there is all this activity for a company that is alleged merely to be a way to bypass regulation. Lyft claimed $1.5 billion in revenue in 2017 as well. I think it starkly shows the economic failings of modern regulation. We wouldn't have this massive growth, if there wasn't a desperate need for more ride hailing or gig working options in our societies.
    • (Score: 2) by PartTimeZombie on Tuesday February 20 2018, @12:00AM (3 children)

      by PartTimeZombie (4827) on Tuesday February 20 2018, @12:00AM (#640351)

      We wouldn't have this massive growth, if there wasn't a huge number of desperate people to be exploited for someone else's gain.

      • (Score: 1) by khallow on Tuesday February 20 2018, @01:47AM (2 children)

        by khallow (3766) Subscriber Badge on Tuesday February 20 2018, @01:47AM (#640393) Journal

        We wouldn't have this massive growth, if there wasn't a huge number of desperate people to be exploited for someone else's gain.

        I can't disagree. But it's interesting to note what is being complained about is actually a step to fixing the problem. For example, people who are desperate for a cheap ride? Cheaper than hailing a cab. People who need some extra income (but can't afford the time commitment of a second job) to make ends meet? The gig economy. Massive number of cars sitting around doing nothing? Ride hailing and sharing services create a way to use those cars for other peoples' needs.

        But maybe if we don't allow desperate people ways to help themselves (such as through employment or gigs), they'll go away and become somebody else's problem, right?

        • (Score: 2) by PartTimeZombie on Tuesday February 20 2018, @01:58AM (1 child)

          by PartTimeZombie (4827) on Tuesday February 20 2018, @01:58AM (#640395)

          Ride hailing and sharing services create a way to use those cars for other peoples' needs.

          As long as the people doing the driving don't expect to profit from it, however. (Not that Uber can make any money either).

          But maybe if we don't allow desperate people ways to help themselves (such as through employment or gigs), they'll go away and become somebody else's problem, right?

          I'm not sure where you think they would go.

          • (Score: 1) by khallow on Tuesday February 20 2018, @05:40AM

            by khallow (3766) Subscriber Badge on Tuesday February 20 2018, @05:40AM (#640482) Journal

            As long as the people doing the driving don't expect to profit from it, however.

            I don't know about you, but Uber doesn't force me to drive at a loss. People who drive for ride hailing services do so voluntarily and at will. If they weren't expecting to profit from it, they wouldn't do it.

            But maybe if we don't allow desperate people ways to help themselves (such as through employment or gigs), they'll go away and become somebody else's problem, right?

            I'm not sure where you think they would go.

            Why do you care? As long as they aren't "exploited", it's all good, right? Or maybe living under a bridge is not as swell as being exploited by Uber?

  • (Score: 4, Interesting) by All Your Lawn Are Belong To Us on Monday February 19 2018, @04:40PM

    by All Your Lawn Are Belong To Us (6553) on Monday February 19 2018, @04:40PM (#640139) Journal

    I'll do a different take from khallow.... This case is either not dissimilar to Amazon - a disruptive startup that requires massive funding and will require a long time to pay off for investors... Or it is Pets.com - an attempt at a disruptive startup that eats up lots and lots of money from investors who really, really, really should have known better.

    7.5 billion of sales, yet 12 billion - 10^9 in total losses for a net loss of 4.5 * 10^9. Keep that up and you'll be talking real money.

    Seriously, how do you convince investors that they should put literally Billions of Dollars into your enterprise that has not turned a profit, and you have no immediate plans to change things around in order to make a profit?

    From this article [foxbusiness.com] at Uber lovin' Fox News:

    In his appearance, Khosrowshahi said Uber could quickly reverse its losses by retreating from less-developed markets outside the U.S. and reducing the money it pours into expensive projects like its work on self-driving cars. That, he said, is something Uber isn't ready to do yet.

    "I am pretty confident that we can turn the knobs to make this business profitable, but it would sacrifice growth and innovation," Khosrowshahi said.

    "Pretty confident"? And yet there are individuals that have made to sink money into something that is "pretty confident" but could come back from a loss position but deliberately doesn't do so. Which means they're Gambling.

    So why is it interesting? Because there are people who are allowed to roll dice of that size in the world, and our system lets them. It'll either be a tremendous success or the largest burst bubble in history. And that is interesting to watch happen.

    I'm late - gotta go catch my Lyft out of here. No, wait, Uber. No, wait.... (actually I don't use ridesharing. ;) )

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  • (Score: 3, Interesting) by bob_super on Monday February 19 2018, @05:23PM

    by bob_super (1357) on Monday February 19 2018, @05:23PM (#640158)

    A company which had more negative allegations than the Weinstein Co, and has a direct competitor offering the same service without the rotten smell, still managed to sell hundreds of millions of rides.
    Tells you a lot about people paying attention, "voting with their money", and the magic ability of the market to punish bad actors.
    (my own parents didn't know about Lyft until a month ago).

    Oh, and its unsustainable how much cash they are losing ... Except that it is, because their investors are good at predicting market inertia wins over bad press.