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Uber grew net revenue from 2017Q1 to 2018Q1 by 67% to $2.5 billion, which is unprecedented at that scale, and did it while significantly reducing losses. Uber i
by dpiers 8y ago
Uber grew net revenue from 2017Q1 to 2018Q1 by 67% to $2.5 billion, which is unprecedented at that scale, and did it while significantly reducing losses. Uber is either the dominant player, or has a stake in the dominant player, in every rideshare market around the world. A lot of governance and litigation risks have been mitigated or reduced in the last year (CEO leaving, very public board infighting, Waymo lawsuit, etc).
The drama last year caused a depression in valuation, but the financials remained solid and the business has good management, leading to an opportunity for Buffett to acquire a stake at a discount.
Full disclosure: I work at Uber, but the numbers I quoted are public and the opinions are my own.
- mlthoughts2018 8y agoDo you know if this revenue figure accounts for the “top line revenue problem” (inclusion of government charges, refunds and fare promotions in top line revenue) mentioned for the 2017Q4 numbers at the 13th Naked Capitalism article [0] on Uber? Incidentally that article also casts doubt on whether recent slowing of cost growth is material to profitability. It doesn’t look to be fully updated through 2018Q1 though. [0]: < https://www.nakedcapitalism.com/2018/02/can-uber-ever-deliver-part-thirteen-even-4q-cost-cuts-uber-lost-4-5-billion-2017.html https://www.nakedcapitalism.com/2018/02/can-uber-ever-delive... >
- dpiers 8y agoI can't comment on Uber's financials or accounting practices, but I can add some context on the author linked: Hubert Horan has published numerous articles with very negative outlooks on Uber over the last few years. A good example is one of his original articles from 2016 [0], which calls Uber out for having -143% profit margins in 2015. In 2015Q1, Uber's revenue was $287MM and loss was 385MM. Horan claimed there was "no evidence that Uber’s rapid growth is driving the rapid margin improvements achieved by other prominent tech startups as they “grew into profitability.”" However, 2018Q1's revenue was 8.7x and losses were only 1.2x the 2015Q1 numbers. Horan was clearly wrong, and underestimated the potential of the business. I believe he still doesn't 'get it'. If you don't believe in the potential for any growth business, the numbers can look bad on paper, but time will decide who will be vindicated and who will be disproven. [0]: https://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver-part-one-understanding-ubers-bleak-operating-economics.html https://www.nakedcapitalism.com/2016/11/can-uber-ever-delive...