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Curiously, how is Uber still in business? After losing tens of billions every single year they finally had their first year of profit at a whopping 1.83 million

Curiously, how is Uber still in business? After losing tens of billions every single year they finally had their first year of profit at a whopping 1.83 million. https://qz.com/uber-first-annual-profit-ipo-public-1851234204 https://qz.com/uber-first-annual-profit-ipo-public-185123420... How can they possibly recover the near 100 billion they sunk on growth?

nextworddev 3y ago
Many people in large cities spend $300+ per month on Uber instead of owning a car etc
- oivey 3y ago
  They have to make money on those rides for that to be a plus.
- fragmede 3y ago
  which, between get payments, insurance, and registration, that isn't that bad a trade off.
ilrwbwrkhv 3y ago
Why do they need to recover anything? The whole market runs on foogazi. Marc Anderson's favorite founder is Adam Neumann.
- blackeyeblitzar 3y ago
  To be fair Adam Neumann is impressive. I recommend watching interviews with him to get a better sense of him. WeWork may not be a great business but I also doubt whether most people are capable of getting it to where it is.
bcherny 3y ago
My understanding is that PnL doesn't tell the whole story for a capital-intensive business like Uber. Instead, you want to break it down by city -- for a mature market like SF, I'd expect a healthy profit margin; but for a new city that Uber entered recently, I'd expect it to be a loss for a few years as upfront investments in marketing, ground team, recruiting, etc. take time to pay off. What would be a bad sign is if Uber continues to lose money, even in its most mature markets.
- lchengify 3y ago
  This is correct. For the most part, you are taking the money from your profit centers to invest in new initiatives. Could be geo's, could also be verticals, etc. This is not at all unusual for a company where the top line is growing. As a point of comparison, Amazon was founded in 1994 and not profitable until 2003.
  - lotsofpulp 3y ago
    Difference with Amazon is the barrier to entry to creating a worldwide distribution business is far, far greater than creating a ride hailing app. Amazon was losing money to invest in valuable real estate and buildings and other big ticket capital items that retain worth, whereas Uber is basically giving away subsidized rides hoping that people will pay more in the future.
    - zaroth 3y ago
      Their barrier is definitely not their app. However, I would not want to own a lot of Uber shares with the way FSD is progressing since v12.
    - jjmarr 3y ago
      I spoke with an Uber driver about this recently, and one of Uber's barriers to entry is their phenomenal data on roads. As an example, they know for every apartment complex, where you'd drive around inside to drop off food as oftentimes you can't just go to the front. Or which parts of a road have no stopping zones along with the schedules. Bus stops too. And the app will guide you to get a pickup where the Uber driver is actually allowed to stop. Drivers are interested in those features because it makes them more efficient. And having a critical mass of drivers is what makes it possible to get a ride in a few minutes. There are other upstarts, but they don't have many drivers, and your potential user market doesn't scale linearly with drivers because nobody wants to wait 30 minutes to get a ride (even with crazy discounts).
      - vel0city 3y ago
acchow 3y ago
All that debt was converted to common stock. It doesn’t need to be paid back.
gigel82 3y ago
Now that they almost completely eliminated the competition (by "disrupting" the market with magic money) and have locked in customers, they can begin the 2nd phase, which is jacking up the prices. Classic techno-feudalism.
- pas 3y ago
  that sets them up for "disruption". as Uber and Lyft trained users to be happy to download an app to get better prices an N+1. "ridesharing" company can enter the market anytime (for example Bolt or Cabify)
metaphor 3y ago
> ...they finally had their first year of profit at a whopping 1.83 million. It's almost as if your reference was generated by some half-baked AI bot that doesn't know how to contextually interpret comma/period numerical delimiters in financial statements of US companies. From authoritative source[1], Uber's 2023 bottom line reads $1.887 billion. [1] https://www.sec.gov/Archives/edgar/data/1543151/000154315124000012/uber-20231231.htm#i11d3f9c49b8d40d5a22dbaa48088842b_103 https://www.sec.gov/Archives/edgar/data/1543151/000154315124...
chrisjj 3y ago
The don't need to recover it. It was investment, not borrowing.

nextworddev 3y ago

Many people in large cities spend $300+ per month on Uber instead of owning a car etc

oivey 3y ago
They have to make money on those rides for that to be a plus.
fragmede 3y ago
which, between get payments, insurance, and registration, that isn't that bad a trade off.

ilrwbwrkhv 3y ago

Why do they need to recover anything? The whole market runs on foogazi. Marc Anderson's favorite founder is Adam Neumann.

blackeyeblitzar 3y ago
To be fair Adam Neumann is impressive. I recommend watching interviews with him to get a better sense of him. WeWork may not be a great business but I also doubt whether most people are capable of getting it to where it is.

bcherny 3y ago

My understanding is that PnL doesn't tell the whole story for a capital-intensive business like Uber. Instead, you want to break it down by city -- for a mature market like SF, I'd expect a healthy profit margin; but for a new city that Uber entered recently, I'd expect it to be a loss for a few years as upfront investments in marketing, ground team, recruiting, etc. take time to pay off. What would be a bad sign is if Uber continues to lose money, even in its most mature markets.

lchengify 3y ago
This is correct. For the most part, you are taking the money from your profit centers to invest in new initiatives. Could be geo's, could also be verticals, etc. This is not at all unusual for a company where the top line is growing. As a point of comparison, Amazon was founded in 1994 and not profitable until 2003.
- lotsofpulp 3y ago
  Difference with Amazon is the barrier to entry to creating a worldwide distribution business is far, far greater than creating a ride hailing app. Amazon was losing money to invest in valuable real estate and buildings and other big ticket capital items that retain worth, whereas Uber is basically giving away subsidized rides hoping that people will pay more in the future.
  - zaroth 3y ago
    Their barrier is definitely not their app. However, I would not want to own a lot of Uber shares with the way FSD is progressing since v12.
  - jjmarr 3y ago
    I spoke with an Uber driver about this recently, and one of Uber's barriers to entry is their phenomenal data on roads. As an example, they know for every apartment complex, where you'd drive around inside to drop off food as oftentimes you can't just go to the front. Or which parts of a road have no stopping zones along with the schedules. Bus stops too. And the app will guide you to get a pickup where the Uber driver is actually allowed to stop. Drivers are interested in those features because it makes them more efficient. And having a critical mass of drivers is what makes it possible to get a ride in a few minutes. There are other upstarts, but they don't have many drivers, and your potential user market doesn't scale linearly with drivers because nobody wants to wait 30 minutes to get a ride (even with crazy discounts).
    - vel0city 3y ago

acchow 3y ago

All that debt was converted to common stock. It doesn’t need to be paid back.

gigel82 3y ago

Now that they almost completely eliminated the competition (by "disrupting" the market with magic money) and have locked in customers, they can begin the 2nd phase, which is jacking up the prices. Classic techno-feudalism.

pas 3y ago
that sets them up for "disruption". as Uber and Lyft trained users to be happy to download an app to get better prices an N+1. "ridesharing" company can enter the market anytime (for example Bolt or Cabify)

metaphor 3y ago

> ...they finally had their first year of profit at a whopping 1.83 million. It's almost as if your reference was generated by some half-baked AI bot that doesn't know how to contextually interpret comma/period numerical delimiters in financial statements of US companies. From authoritative source[1], Uber's 2023 bottom line reads $1.887 billion. [1] https://www.sec.gov/Archives/edgar/data/1543151/000154315124000012/uber-20231231.htm#i11d3f9c49b8d40d5a22dbaa48088842b_103 https://www.sec.gov/Archives/edgar/data/1543151/000154315124...

chrisjj 3y ago

The don't need to recover it. It was investment, not borrowing.