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Expected. Uber/Lyft will get through it but have to prepare for a though time ahead. I'm pretty optimistic that things will soon start getting back to normal, g

Expected. Uber/Lyft will get through it but have to prepare for a though time ahead. I'm pretty optimistic that things will soon start getting back to normal, gradually of course. However, business travel (and personal) will take a while to recover. Companies already canceled all large events for the year. All academic conferences this year are remote, etc. Most tech employees were already told to keep working remotely until at least Sep/Oct. So even with very optimistic projections, things will start looking better for these companies only next year.

rswail 6y ago
No one is driving around, other than Uber Eats and deliveries, there is nowhere for people to go. There's no one flying, so no airport traffic. There's no sports events, there's no entertainment districts active. If anything, Uber will save money by not operating. Their cashburn should be substantially lowered if they are not subsidizing rides.
- komali2 6y ago
  Maybe on San Francisco. Houston for example is opening right back up, grandma's health be damned. Traffic is heavy on i45 again. All those people are driving somewhere.
- tinyhouse 6y ago
  Well, that's true for where you live right now, which I assume it's the US. Many places around the world start reopening. US is probably 1-2 months behind, at least some states like NY and MA. But obv things won't go back to normal immediately.
- karthikb 6y ago
  This is older analysis [1] but Uber is profitable on each ride in their biggest markets until you deduct the OPEX of the main co. The burn of sales, marketing, engineering, support, their rider safety team, the driver inspection and on boarding centers, leases, etc all continue on with or without riders. [1] https://benjamintseng.com/2019/04/lyft-vs-uber-a-tale-of-two-s-1s/ https://benjamintseng.com/2019/04/lyft-vs-uber-a-tale-of-two...
  - jbn 6y ago
    isn't it the case that they could decrease their burn rate by downsizing sales, marketing, etc.. ? At the same time, this time presents a unique opportunity for their engineering: how often does the market give you several months to breathe? Isn't this the time to polish the product, to finally fix all that tech debt you accumulated?
    - karthikb 6y ago
      Yes. That’s why they’re laying people off, and why Uber stock is up in after hours trading. Because of these layoffs, their margins have actually improved. Doesn’t make things any better for the people who find themselves without a job, though.
- alexeichemenda 6y ago
  There is a misconception that Uber loses money on every ride. If you look at their SEC filing, it's not how they actually work (I won't have time to do that search for you now but will try to edit my post later). TL;DR of their SEC filings: They're not losing money on every ride, they just have such a high baseline of fixed costs (payroll being one) that they haven't started being profitable. Doing fewer rides right now is actually killing their profitability.
- xfitm3 6y ago
  Traffic is heavy in my area.
hyperbovine 6y ago
> I'm pretty optimistic that things will soon start getting back to normal Based on what? Raise your hand if you're excited about either driving or being driven by strangers now. I think we're looking at several years post-vaccine before one can credibly argue that peoples' comfort with that sort of thing will have recovered to pre-pandemic levels. Ditto AirBnb.
tomashertus 6y ago
My prediction is that this crisis will completely change business traveling as we know it. It will have extended negative impact on the whole travel industry. The US "Business Travel" industry is $300B/year industry [1] and I think we will see more than 50% drop in coming years. That's 2.5M jobs in danger. 1. https://www.ustravel.org/answersheet https://www.ustravel.org/answersheet

rswail 6y ago

No one is driving around, other than Uber Eats and deliveries, there is nowhere for people to go. There's no one flying, so no airport traffic. There's no sports events, there's no entertainment districts active. If anything, Uber will save money by not operating. Their cashburn should be substantially lowered if they are not subsidizing rides.

komali2 6y ago
Maybe on San Francisco. Houston for example is opening right back up, grandma's health be damned. Traffic is heavy on i45 again. All those people are driving somewhere.
tinyhouse 6y ago
Well, that's true for where you live right now, which I assume it's the US. Many places around the world start reopening. US is probably 1-2 months behind, at least some states like NY and MA. But obv things won't go back to normal immediately.
karthikb 6y ago
This is older analysis [1] but Uber is profitable on each ride in their biggest markets until you deduct the OPEX of the main co. The burn of sales, marketing, engineering, support, their rider safety team, the driver inspection and on boarding centers, leases, etc all continue on with or without riders. [1] https://benjamintseng.com/2019/04/lyft-vs-uber-a-tale-of-two-s-1s/ https://benjamintseng.com/2019/04/lyft-vs-uber-a-tale-of-two...
- jbn 6y ago
  isn't it the case that they could decrease their burn rate by downsizing sales, marketing, etc.. ? At the same time, this time presents a unique opportunity for their engineering: how often does the market give you several months to breathe? Isn't this the time to polish the product, to finally fix all that tech debt you accumulated?
  - karthikb 6y ago
    Yes. That’s why they’re laying people off, and why Uber stock is up in after hours trading. Because of these layoffs, their margins have actually improved. Doesn’t make things any better for the people who find themselves without a job, though.
alexeichemenda 6y ago
There is a misconception that Uber loses money on every ride. If you look at their SEC filing, it's not how they actually work (I won't have time to do that search for you now but will try to edit my post later). TL;DR of their SEC filings: They're not losing money on every ride, they just have such a high baseline of fixed costs (payroll being one) that they haven't started being profitable. Doing fewer rides right now is actually killing their profitability.
xfitm3 6y ago
Traffic is heavy in my area.

hyperbovine 6y ago

> I'm pretty optimistic that things will soon start getting back to normal Based on what? Raise your hand if you're excited about either driving or being driven by strangers now. I think we're looking at several years post-vaccine before one can credibly argue that peoples' comfort with that sort of thing will have recovered to pre-pandemic levels. Ditto AirBnb.

tomashertus 6y ago

My prediction is that this crisis will completely change business traveling as we know it. It will have extended negative impact on the whole travel industry. The US "Business Travel" industry is $300B/year industry [1] and I think we will see more than 50% drop in coming years. That's 2.5M jobs in danger. 1. https://www.ustravel.org/answersheet https://www.ustravel.org/answersheet