Massive setback for Uber ahead of IPO; Quarterly loss surges to $1.1 billion as bookings slows
Uber Technologies Inc is experiencing a turbulent ride as its growth numbers are dramatically slowing even as the company is now spending more to fuel global growth.
Keeping it in mind that Uber is seeking to expand in freight hauling, food delivery and electric bikes and scooters, the growth in its now decade-old ride-hailing business dwindles. With a current valuation of around $76 billion, Uber is reportedly facing pressure to show it can still grow enough to become profitable and satisfy investors in IPO which is scheduled to take place sometime next year.
Uber, earlier this week, released a limited set of financial information, a move the privately held company voluntarily does each quarter. The San Francisco-based company also offered a glimpse into its food delivery business for the first time. A spokesperson of the company told Bloomberg that Uber Eats generated $2.1 billion in gross bookings. It represents 17 per cent of Uber’s $12.7 billion in gross bookings last quarter. However, there is still an uncertainty over the profit-making of company core cab-hailing business.
Recently speaking at Wall Street Journal technology conference earlier this week, Uber CEO Dara Khosrowshahi defended the company’s ability to achieve profitability. He stated that some ride-hailing markets generate profit for Uber after accounting for local operations teams, drivers and other regional expenses.
However, in the US, the business is still not profitable with a heavy dominance of its immediate competitor Lyft Inc. Uber also believes that countries such as India and the Middle East are its potential markets and it will continue to grow here with a focus to solidify its leadership position.
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