3 ms·

Sure you can. It is not obvious what the right methodology would be: * Should you assume that losses are going to get worse? Lyft raised their largest round so

Sure you can. It is not obvious what the right methodology would be: * Should you assume that losses are going to get worse? Lyft raised their largest round so far: $600M at $7.5 Billion. Presumably, they are going to use that money to get even more aggressive. I hear that some US markets are already a mess for Uber. Others are good. * Should you assume it is going to get better? In the past quarter it has, so you might want to assume that it will continue. Also, I don't know if I trust Uber's financial reporting. This is clearly a PR move and you have a lot of choices in private accounting. Assuming steady state does not strike me as an unreasonable way of forecasting.

malandrew 9y ago
Losses may or may not get worse. AFAIK, they have gotten better every quarter since China was sold off. Assuming steady state or steady state of change are both reasonable ways of forecasting. A strong trend line spanning several quarters better supports the latter in this case. For what's its worth, I recently saw losses as a percent of gross bookings posted elsewhere: Lyft at 13% vs Uber at 8.5%. Are you assuming that Lyft will increase subsidies after this new round of funding? If so, that will only worsen its losses as a percent of gross bookings. Furthermore, that isn't Lyft's biggest round. They raised $1B in January 2016. Uber just needs to remain more efficient than its competition in all markets, which is easier to do with global operations and multiple business lines that are easy to scale out.