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from the that's-like-burning-two-$100-bills-AND-one-$20-bill-every-single-second dept.
Coronavirus clobbers Uber, leading to $1.8 billion quarterly loss:
The coronavirus pandemic hammered Uber's finances in the second quarter of 2020, the company announced on Thursday. Gross bookings for Uber's core ride-hailing business plunged by 75 percent compared with a year earlier—from $12.2 billion to $3 billion.
That was offset somewhat by rapid growth in Uber's delivery business. Delivery bookings more than doubled from $3.4 billion to $7 billion.
The company lost $1.8 billion in the second quarter on a GAAP basis. Ignoring one-time charges, Uber has been losing around $1 billion per quarter for the last couple of years.
[...] In May, Uber laid off 3,700 people in an effort to contain mounting losses.
Demand for rides cratered, while demand for deliveries soared. In his Thursday statement, Khosrowshahi argued that Uber's product portfolio had a "natural hedge" since people ordered more takeout even as they cut back on going out.
Still, Uber says that its rides business earned a $50 million profit on an EBITDA (earnings before interest, taxes, depreciation and amortization) basis. The problem is that this figure is nowhere close to offsetting losses and overhead elsewhere—including the delivery business and Uber's expensive self-driving project.
Fortunately, Uber is in no danger of running out of money; it has almost $8 billion in cash and short-term investments. It could easily burn cash at this rate for another year.
(Score: 1, Insightful) by Anonymous Coward on Monday August 10 2020, @08:11PM (9 children)
That is how much money people had to waste on a silly idea. "We want a taxi that isn't a taxi. We just want someone to come get us whenever we want, and we want to throw them some chump change for picking us up. We don't mind handing over billions of dollars to some fool who promises to manage these drivers, as long as we don't have to pay the drivers full taxi fee!"
(Score: 2) by takyon on Monday August 10 2020, @08:16PM
It would have worked if GoogUber had kicked those pesky drivers into the gutter to die and rolled out the robot cars. Corona came just a little too soon.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 0) by Anonymous Coward on Monday August 10 2020, @09:39PM (6 children)
I keep wondering how long it's going to be until venture capitalists stop throwing money at businesses that can't turn a profit and lack a business model. Disruption is not a business model and it's rather ridiculous that they keep being funded.
(Score: 0) by Anonymous Coward on Monday August 10 2020, @10:12PM
As long as you have people with Stupid Money they didn't earn, you'll get people making stupid gambles - sorry, investments - and talking loudly about the ones they won.
(Score: 4, Insightful) by Mykl on Monday August 10 2020, @10:36PM (3 children)
I for one am thankful that there are people willing to throw their money away. We will be able to build great things off the back of their write-offs.
Governments are no longer interested in spending billions researching things that will advance humanity. Think of the billions spent on space research in the mid-20th century that eventually led to satellite technologies including GPS. Now we get to build the next great technologies off the back of VC money.
As long as there are VC success stories like Facebook and Google, there will be VC money. Think of it like the rich person's version of playing the lottery.
(Score: 1, Insightful) by Anonymous Coward on Monday August 10 2020, @10:46PM (2 children)
That's only because the same leeches are bribing them to prioritize war and tax cuts over long term investments in things that will benefit mankind. It's beyond fucked up that philanthropy covers things that are genuine problems of societal importance. Things like homelessness and poverty should be solved via government policies, not hoping that a billionaire will care enough to give back some of the ill begotten gains.
(Score: 2) by Mykl on Tuesday August 11 2020, @01:04AM (1 child)
You need to move to a country that cares about its people. There are plenty of Western Democracies that do.
(Score: 0) by Anonymous Coward on Tuesday August 11 2020, @01:53PM
Yes, but if all the sane folks do that, then god help us all. Just imagine a nuclear armed state where the motto is "hold my beer while I try this."
(Score: 4, Informative) by c0lo on Tuesday August 11 2020, @03:50AM
You totally misunderstood VC's game.
Their product is hype, they cash out at the IPO stage (or early).
The ones that see their money gone are various investment funds (pension funds included), which buy the public shares.
https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
(Score: 2) by corey on Monday August 10 2020, @11:10PM
I would have thought this isn't much of a problem for them, because the drivers are subcontractors. If no customers, then no contractors. That part of the business is just in hibernation, no income, no/low liabilities. Meanwhile they continue to make money delivering food cold, then making the restaurant prepare another pack of food at the restaurants cost.