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Uber Q2 financials

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Re: Uber Q2 financials

#11

Post by pfarnsworth »

forthefuture wrote: post #3

Can someone explain to a layman how a company losing $600M every 3 months, with $6B remaining of $12B raised (50% loss over 8 years) is "worth" $62B?

A combination of growth rate, and positing where Uber will be once they stop spending money on things like self-driving cars, etc, which are very expensive with no revenues yet. It's similar to Amazon that for years only had minimal profits because they were spending so heavily on new products. The idea was that Amazon could generate tons of money by simply curtailing their spending, which fuels the speculation on their share price.

Re: Uber Q2 financials

#12

Post by tmh79 »

gremlinsinc wrote: post #7
dragonwriter wrote: post #4

Earlier quoted context omitted.

Value is based on what investors expect the firm will be able to do in the future, which may differ from what they are doing now.

I think there will be a big pivot from car ownership to rentals... maybe add up insurance, maintenance, and leasing fees to get to $600-1000 a month for unlimited car-service. Automated cars will be summoned by phone, arrive when you schedule them, and go pick up others when not needed.. Pretty sure a lot of the car companies are planning something like this, I know tesla is. Uber wants to hold out till their self-dr…

> I think uber's in a death spin, not sure it can pull out.

that is not evidenced at all in their financials though. Their losses are down and their revenue is up. They are doing exactly what is expected of them if they hope to be profitable in the next 18 months or so.

Re: Uber Q2 financials

#13

Post by koolba »

bousaid wrote: post #6
WisNorCan wrote: post #5

Earlier quoted context omitted.

Growth companies are valued on future expectations and not on current financials. You have to believe that the economics will improve for Uber. The $68 billion Uber valuation is also not real in the sense that investors have liquidation preferences and multiples. Employees don't and have the inverse of what is given to investors. The real value is some fraction. They have also stumbled like no other company before th…

That's my biggest wonder, how can the economics change for the better?

Say they have a break through in self driving cars and cut the fee they're paying to drivers down to just the depreciation of the vehicle. They'd be profitable immediately.

Re: Uber Q2 financials

#14

Post by trevyn »

cloudwalking wrote: post #8
bousaid wrote: post #6

Earlier quoted context omitted.

That's my biggest wonder, how can the economics change for the better?

If, for example, Uber crushes all competition, then they can raise fares and lower partner payments and make a bigger profit.

Or if they become the self-driving service of choice, they can lower fares and capture a larger portion of the broader transportation market and make a profit.

Re: Uber Q2 financials

#15

Post by debacle »

cloudwalking wrote: post #8
bousaid wrote: post #6

Earlier quoted context omitted.

That's my biggest wonder, how can the economics change for the better?

If, for example, Uber crushes all competition, then they can raise fares and lower partner payments and make a bigger profit.

Every time Uber scores a municipal victory, they're lowering the barrier to entry for competitors.

Re: Uber Q2 financials

#16

Post by adventured »

WisNorCan wrote: post #2

“Uber had $6.6 billion in cash at quarter's end, down from around $7.2 billion at the end of Q1 ... Uber's global ride-share business was margin positive last quarter, which is a flip from Q1.” Uber is on a loss run rate of $2.4 billion annually mainly from the US market. The questions become: * Given that global is positive, what is the loss in US? What will it take to flip US to positive? What will Lyft do? * Can U…

Uber isn't losing $2.4 billion primarily in the US market, you've got it the wrong way. Their biggest losses are from the international side of the business, spending on that build-out effort.

Margin positive internationally is not the same as earning a profit after all expenses. What they're talking about is international revenue exceeding international losses finally (the US market has been above that line for a long time).

Re: Uber Q2 financials

#17

Post by WisNorCan »

adventured wrote: post #16
WisNorCan wrote: post #2

“Uber had $6.6 billion in cash at quarter's end, down from around $7.2 billion at the end of Q1 ... Uber's global ride-share business was margin positive last quarter, which is a flip from Q1.” Uber is on a loss run rate of $2.4 billion annually mainly from the US market. The questions become: * Given that global is positive, what is the loss in US? What will it take to flip US to positive? What will Lyft do? * Can U…

Uber isn't losing $2.4 billion primarily in the US market, you've got it the wrong way. Their biggest losses are from the international side of the business, spending on that build-out effort. Margin positive internationally is not the same as earning a profit after all expenses. What they're talking about is international revenue exceeding international losses finally (the US market has been above that line for a lo…

"The $645 million is adjusted EBIT, while Uber's Q2 EBITDA loss was $534 million (down from $598 million in Q1). Uber's global ride-share business was margin positive last quarter, which is a flip from Q1."

The context around EBIT/EBITDA implies that they are discussing operating margin and not gross margin. Can you clarify what major expenses you believe would be excluded?

Re: Uber Q2 financials

#18

Post by mbesto »

bousaid wrote: post #6
WisNorCan wrote: post #5

Earlier quoted context omitted.

Growth companies are valued on future expectations and not on current financials. You have to believe that the economics will improve for Uber. The $68 billion Uber valuation is also not real in the sense that investors have liquidation preferences and multiples. Employees don't and have the inverse of what is given to investors. The real value is some fraction. They have also stumbled like no other company before th…

That's my biggest wonder, how can the economics change for the better?

Simple - autonomous vehicles. It's the single largest line item of COGS. Reduce a COGS line by let's say 25% for revenues of $10B and you all of the sudden have another $2.5B in extra profit.

EDIT - I totally simplified that math (and it reads odd as stated), but you get the point.

Re: Uber Q2 financials

#20

Post by josephmerz »

debacle wrote: post #15
cloudwalking wrote: post #8

Earlier quoted context omitted.

If, for example, Uber crushes all competition, then they can raise fares and lower partner payments and make a bigger profit.

Every time Uber scores a municipal victory, they're lowering the barrier to entry for competitors.

So true
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