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Uber S-1

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Re: Uber S-1

#371

Post by alexnewman »

rory096 wrote: post #29
chollida1 wrote: post #10

Note: - Expected to be teh largest IPO this year in the US. - 10th largest all time - trying to raise around $10B - 2018 Year Ended Revenue $11.27 billion - 2018 Year Ended Net Income $997 million - 2017 Year End lost $4.03 billion. - 10 billion trips in September 2018, up from 5 billion in September 2017 - Gross Bookings From Ridesharing $41.5 billion in 2018 - Revenue From Ridesharing Products $9.2 Billion in 2018…

> Lyft now at $61/share, ouch, there just is no other way to put it. THey pulled a lot of financial engineering tricks to boost their IPO price and well the results speak for themselves:( I don't understand why this is seen as a negative. An IPO is a share issuance — the higher the price per share, the more money they receive in exchange for the same percentage of the company. Post-IPO "pops" represent money left on…

Perhaps when large companies issue options at ipo they should expect this type of behavior.

Re: Uber S-1

#372

Post by bunderbunder »

panarky wrote: post #35
partingshots wrote: post #18

So... Let me see if I have this straight: 1. Uber is unprofitable and the only way it can become profitable is to get SDC's 2. Uber is significantly (years) behind Waymo in the SDC space. 3. Waymo will launch SDC taxi services first meaning: - When it puts in an order for SDC components no one else is going to be buying in bulk and thus it can have effectively 100% of capacity of these specialized equipment makers -…

> can't imagine how Uber is worth anything If the operation doesn't make an economic profit, and if there isn't sufficient moat to defend the operation until it can become profitable, then I agree with you it's not worth anything. But in fact, Uber does have a massive moat -- its network of drivers and riders in thousands of cities around the world. No competitor is even close. It takes tremendous capital expenditure…

> But in fact, Uber does have a massive moat -- its network of drivers and riders in thousands of cities around the world. No competitor is even close.

Given Uber's financials, this still reads to me as, "Nobody in the world can burn money anywhere near as fast as we can."

It's not inconceivable that they could get into the black, but a year-over-year adjusted EBIDTA loss that's getting larger instead of smaller, and a revenue as a percentage of gross bookings that's doing the same, says that they've got no better idea than I do of how to make that actually happen.

Re: Uber S-1

#373

Post by empath75 »

ManishR wrote: post #355

People here seem to think that Uber/Lyft do not have any competitive moat. I disagree. What we seem to forget is that just because a VC can burn boatloads of money to capture ridesharing market from Uber/Lyft doesn't mean that they would. From a game theoretic POV, Uber and Lyft have signaled that they're ready to fight for survival in markets they are established in. Unless as a startup founder you can demonstrate t…

Why would anyone want to challenge them to take over a market they’re losing billions of dollars in?

Re: Uber S-1

#374

Post by scythe »

arcticbull wrote: post #248
smallgovt wrote: post #54

Earlier quoted context omitted.

Can't Uber become profitable by raising prices and lowering costs? They have $40B in gross rideshare bookings and $3B in real losses for 2018. Let's assume 20% of their costs are fixed and 80% are variable. What might happen if they raise prices by 10%? Gross bookings drop by 20% / Revenue per booking increase by 10% => $35.2B in gross bookings Variable costs drop by 30% (due to lower driver acquisition costs since t…

I'm not sure why you think 20% of costs are fixed and 80% are variable, or that the elasticity figures are what you suggest they are. Realistically, Uber has a higher cost basis than a taxi because taxis cut down on insurance and fleet expenses through pooling. As such, Uber is not really able to beat them on price. There's no evidence to support the idea that people are willing to pay more than taxis to use Uber or…

>Realistically, Uber has a higher cost basis than a taxi because taxis cut down on insurance and fleet expenses through pooling.

But Uber's price / taxis' price is wider than Uber's revenue / Uber's costs. Uber addresses various problems with taxis:

- driver certification: the brokenness of taxi certification arguably created Uber, via unreasonable constraints on the number of taxis in many jurisdictions

- availability: Uber's surge pricing may suck, but it's more fair than random price gouging by drivers at odd times in weird places

- rider pooling: you don't have to pass a hailing rider to combine trips; there's an algorithm for that

- verification: fake taxis used to be a serious problem, but Uber (usually) gives you the license plate # of your driver

Also, with regard to fleet expenses, Uber is arguably taking advantage of decaying capital that would have gone to waste. The cost of a car is often quoted in cents per mile, but that's not quite accurate. A car that sits in a garage will eventually fail; the lifespan of a car is limited by time as well as distance. Many people weren't driving their cars as far as they could in the time that they had -- and in my experience, Uber drivers tend to drive in the machine-gentlest way they possibly can (sometimes annoyingly so -- but why wouldn't they?). The use of own cars potentially yields a significant savings over a dedicated fleet. (Likewise, Uber "pools" the cost of insurance on the taxi with the cost of insurance on the own car.)

Re: Uber S-1

#375

Post by [deleted] »

rory096 wrote: post #29
chollida1 wrote: post #10

Note: - Expected to be teh largest IPO this year in the US. - 10th largest all time - trying to raise around $10B - 2018 Year Ended Revenue $11.27 billion - 2018 Year Ended Net Income $997 million - 2017 Year End lost $4.03 billion. - 10 billion trips in September 2018, up from 5 billion in September 2017 - Gross Bookings From Ridesharing $41.5 billion in 2018 - Revenue From Ridesharing Products $9.2 Billion in 2018…

> Lyft now at $61/share, ouch, there just is no other way to put it. THey pulled a lot of financial engineering tricks to boost their IPO price and well the results speak for themselves:( I don't understand why this is seen as a negative. An IPO is a share issuance — the higher the price per share, the more money they receive in exchange for the same percentage of the company. Post-IPO "pops" represent money left on…

[deleted]

Re: Uber S-1

#376

Post by dmoy »

nostrademons wrote: post #353
aliston wrote: post #349

Earlier quoted context omitted.

Employees get taxed on the value that they vest at IPO, but are locked up from selling for 6 months. The company withholds a percentage, effectively selling a portion at IPO, but it is less than the effective tax rate. I should clarify that this applies to RSUs, not options. Edit: something similar can happen with options as mentioned, but the mechanics are slightly different.

For RSUs the withholding should be in shares - if your effective tax rate is 40% and you vest 5 shares a month, they grant you 3 shares and immediately sell 2 to cover the taxes. If your effective tax rate was 30%, they'd round up, still sell 2 of them, but remit the cash in excess of taxes to your paycheck. At least that was how my Google shares worked. A higher IPO price works to your advantage, because the refund…

Except most companies (including Google) withhold supplementary income at 22% federal plus FICA, regardless of whether your marginal bracket is 22% or 35%+.

Usually this results in significant underwithholding on RSU for federal tax.

Re: Uber S-1

#377

Post by SOLAR_FIELDS »

chollida1 wrote: post #10

Note: - Expected to be teh largest IPO this year in the US. - 10th largest all time - trying to raise around $10B - 2018 Year Ended Revenue $11.27 billion - 2018 Year Ended Net Income $997 million - 2017 Year End lost $4.03 billion. - 10 billion trips in September 2018, up from 5 billion in September 2017 - Gross Bookings From Ridesharing $41.5 billion in 2018 - Revenue From Ridesharing Products $9.2 Billion in 2018…

One thought about your ticker comment - I actually prefer it when the ticker is NOT exact same as the company like UBER or LYFT. This is because I know when I google AMZN, AAPL, TSLA etc. the search engine knows I want the stock price and am specifically asking about stock. For UBER and LYFT I have to type something like ‘LYFT stock’ if I want the price, trends and news around that.

Re: Uber S-1

#378

Post by Skunkleton »

prewett wrote: post #123
throwaway5752 wrote: post #24

Earlier quoted context omitted.

They did really well with the CEO they recruited. From the outside, it seemed like he did a really exceptional job profitably growing Expedia.

When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact. --- Warren Buffett Expedia makes money from advertising (12%), from bookings fees, and from buying blocks of hotel rooms at a discount then selling them for higher prices to their customers (66%). [1] All of these revenue models are something that is pret…

To further your second point. A whole cottage industry has sprung up around AirBnB. To me this indicates that the business model for AirBnB is working. There is no similar thing happening w/ uber. Seems to just be a question of who (uber or the drivers) is going to absorb the losses.

Re: Uber S-1

#379

Post by bunderbunder »

panarky wrote: post #161
BinaryIdiot wrote: post #46

Earlier quoted context omitted.

> It takes tremendous capital expenditure to build that network, and it will take tremendous capital expenditure to neutralize it. Does it, though? Every driver I've talked to basically drives for "all of them". Several told me they try to find whatever apps are local for driving and they setup those alone with Uber and Lyft and simply take whatever pays the most / is more frequent. Uber's software and network are so…

> Does it, though? It absolutely takes tremendous capital expenditure to build the network. Uber has an accumulated deficit of $20 billion precisely because they subsidized both drivers and riders to build the two-sided network. It doesn't have to be winner-take-all. A duopoly in most medium to large cities is perfectly viable. But you won't see dozens of competitors because the drivers and riders would wait too long…

> It absolutely takes tremendous capital expenditure to build the network.

It's like breaking trail: It's a whole lot of work for the person in front, but it's damn easy for everyone else.

Uber, being first mover, had to spend great heaping piles of money convincing people to become rideshare drivers in the first place. Because they had to sell people on the idea of driving folks for a living, and then get them to buy new cars that meet their standards, and then train them on how to be a rideshare driver, and all that fun stuff.

Everyone else just needs to convince a group of people who have already bought the car and learned how to drive it that it's in their interest to hedge their bets. Which, given how Uber has historically treated its drivers, is something that requires approximately zero convincing.

Re: Uber S-1

#380

Post by sabertoothed »

jiveturkey wrote: post #368
tsycho wrote: post #365

Earlier quoted context omitted.

What's SDC? I got nothing obvious from googling it. UPDATE: Got it, self driving cars. I am not deleting the comment in case others were confused as well.

use contextual clues ... Self Driving Car

SDC could have been a company since it was mentioned next to Waymo. I stumbled as well for a few seconds.
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