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EBITDA is a wipespread (though still somewhat sketchy) practice. "Adjusted EBITDA" is just making up fairy-tale numbers.

gok 7y ago
Which adjustments in particular do you find deceptive in Uber's case?
- scarface74 7y ago
  They aren’t “deceptive”, they spell out how they arrived at those numbers, they disclosed that they aren’t GAAP and did all of the other disclosures that anyone who knows how to read financial statements would understand and should be able to make a judgement call on how to weight them. I’m more calling out the tech industry in general and some posters on HN specifically about how they sugar coat the performance of money losing present and former unicorns and they don’t measure success by profitability or at least marginal profits where you could see a clear road to profitability. Dropbox for instance is a YC/HN darling. It is one of only two YC funded companies to ever go public, has never been profitable and looks like it’s going to be squished as other players like Microsoft, Google and even Apple make their entire business “just a feature”.
  - gok 7y ago
    I agree that the industry would be healthier if companies tried to become viable/profitable earlier. I think in particular many took the wrong lesson from Amazon's ability to grow without making money for ~20 years.
scarface74 7y ago
I didn’t realize the EBiTDA wasn’t GAAP. But you are absolutely right. https://www.investopedia.com/terms/e/ebitda.asp https://www.investopedia.com/terms/e/ebitda.asp
- gok 7y ago
  There are legitimate reasons to report non-GAAP numbers next to the required GAAP numbers. When it was required to recognize revenue phone sales over 2 years, Apple included non-GAAP numbers to give investors a better sense of how sales were actually growing, and reported it as "Adjusted Sales" and "Adjusted Net Income." These were completely made up terms, but they did give a vastly more accurate image of where the company was going than the GAAP numbers did.

gok 7y ago

Which adjustments in particular do you find deceptive in Uber's case?

scarface74 7y ago
They aren’t “deceptive”, they spell out how they arrived at those numbers, they disclosed that they aren’t GAAP and did all of the other disclosures that anyone who knows how to read financial statements would understand and should be able to make a judgement call on how to weight them. I’m more calling out the tech industry in general and some posters on HN specifically about how they sugar coat the performance of money losing present and former unicorns and they don’t measure success by profitability or at least marginal profits where you could see a clear road to profitability. Dropbox for instance is a YC/HN darling. It is one of only two YC funded companies to ever go public, has never been profitable and looks like it’s going to be squished as other players like Microsoft, Google and even Apple make their entire business “just a feature”.
- gok 7y ago
  I agree that the industry would be healthier if companies tried to become viable/profitable earlier. I think in particular many took the wrong lesson from Amazon's ability to grow without making money for ~20 years.

scarface74 7y ago

I didn’t realize the EBiTDA wasn’t GAAP. But you are absolutely right. https://www.investopedia.com/terms/e/ebitda.asp https://www.investopedia.com/terms/e/ebitda.asp

gok 7y ago
There are legitimate reasons to report non-GAAP numbers next to the required GAAP numbers. When it was required to recognize revenue phone sales over 2 years, Apple included non-GAAP numbers to give investors a better sense of how sales were actually growing, and reported it as "Adjusted Sales" and "Adjusted Net Income." These were completely made up terms, but they did give a vastly more accurate image of where the company was going than the GAAP numbers did.