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Uber opens at $42 per share

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Re: Uber opens at $42 per share

#371

Post by dang »

ggcb wrote: post #204
EpicEng wrote: post #136

Earlier quoted context omitted.

Comparing Uber to Amazon is just silly. Amazon had/has a sustainable, robust business model. They chose to re-invest. Uber burns money like it's going out if style and has no clear path to profitability.

this is so obvious, yet there are several highly voted comments here insanely comparing uber to amazon. I sense a strong astroturfing to bump uber here.

"Please don't insinuate about astroturfing. It degrades discussion and is usually mistaken. If you're worried, email us and we'll look at the data."

https://news.ycombinator.com/newsguidelines.html

Re: Uber opens at $42 per share

#372

Post by caprese »

iakh wrote: post #350
caprese wrote: post #314

Earlier quoted context omitted.

> ...aaaand, Uber (meaning, the owners of Uber pre-IPO) has less ownership in the business afterwards. How is that even a point? They had 23 funding rounds according to Crunchbase where the same thing happened everytime, with today being the 24th. You don't have to acknowledge any of those things, this is how finance works.

If you have $1 and I give you $1, but you now only own half of the total of $2. You did not "make" $1.

If you have an asset and someone pays for that asset with a more liquid asset, then you now have that more liquid asset

In this case Uber Inc exchanged illiquid stock for liquid dollars.

Why the semantical debate? Did the use of the word “make” really bother you? What about when there is dilution like in most funding rounds? Shares of equivalent value are literally made. In this IPO Im not sure if that happened with the sale to the underwriters or not.

This kind of asset exchange is what we are all trying to do, exchange one asset for a more liquid one, dollars. They succeeded in doing that to the tune of 8.1 billion usd. The same us dollars that give access to everything in the global financial system via wire transfer.

Re: Uber opens at $42 per share

#373

Post by underwater »

nPo102y wrote: post #145
chollida1 wrote: post #3

Some notes from watching Uber open: - if it closes below $45(its IPO price) it will be the first time since 2008 that the happened for a major IPO - TD Ameritrade executed more orders in the first 10 minutes of trading than they did for the first 2.5 hours with Lyft. - Uber is 9% of all trading at TD Ameritrade, retail loves this stock, - market is down today, which isn't helping Uber but its probably not much of a f…

Facebook (2012) needed strong underwriter support to barely close above opening price.

Facebook's first day of trading was a mess, NASDAQ was crashing and dropping orders all day.

Re: Uber opens at $42 per share

#374

Post by sumedh »

shmageggy wrote: post #338
busymom0 wrote: post #302

Earlier quoted context omitted.

I agree that Uber is betting on driverless cars to lower the cost per mile. But I think Tesla will beat them to market much much before them considering Tesla already has the tech. Elon even hinted on the Tesla taxi fleet in the next couple years. Now I realize Elon's got poor judgement on timing but I still think they will be able to achieve that much earlier than Uber. And if they do, I honestly don't see Uber surv…

There's no evidence that Tesla has any distance on Uber, other than Elon's word which means jack. Waymo is thought to be the leader in this space.

> other than Elon's word which means jack.

I think history has demonstrated that betting against Musk is not a wise choice.

Re: Uber opens at $42 per share

#375

Post by scarface74 »

sokoloff wrote: post #343
scarface74 wrote: post #190

Earlier quoted context omitted.

Yes you might be paying Uber more, I pay them about $300-$400 a month between our occasional use and my teenage son getting around (still cheaper than a car + insurance), but they lose money on each ride. Amazon has high fixed costs while they were building infrastructure. Uber has negative marginal profits. Edit: negative marginal costs -> negative marginal profits.

I can't get a clear reading from Uber's most recent financials filing in Feb to determine that they have negative marginal profit. It looks the opposite to me. Given their substantial gross profits, I have to think that they last ride they sell is profitable.

What gross profits?

Re: Uber opens at $42 per share

#376

Post by mirajshah »

busymom0 wrote: post #304

There's way too many comments in this thread comparing Uber's non-profitability to Amazon's which I think is quite silly. Amazon lost $2.8 billion over its first 17 quarters while Uber lost $4.5 billion in 2017 alone. Also comparing Uber to Facebook is quite silly too. Facebook had a lot more users than Uber but they are also different types of users. One is a free user with hope for targeted advertisement (in which…

Don't you have to adjust Amazon's 2.8 billion for inflation?

Re: Uber opens at $42 per share

#377

Post by rhizome »

JMTQp8lwXL wrote: post #335
acchow wrote: post #332

Earlier quoted context omitted.

Yes, they want to eat up the whole market until all the competitors die. Then they can raise prices.

With that strategy, Uber might run out of cash before the competition is crushed.

They are way into debt financing and have a $25B bottom line, this is a "when you owe the bank a million dollars..." situation now, nobody involved is going to let it run out of money and throw the whole house of cards away.

Re: Uber opens at $42 per share

#378

Post by foobarian »

busymom0 wrote: post #304

There's way too many comments in this thread comparing Uber's non-profitability to Amazon's which I think is quite silly. Amazon lost $2.8 billion over its first 17 quarters while Uber lost $4.5 billion in 2017 alone. Also comparing Uber to Facebook is quite silly too. Facebook had a lot more users than Uber but they are also different types of users. One is a free user with hope for targeted advertisement (in which…

> Also advertisement has huge margins with not much cost from Facebook's pov but ride sharing logistics is completely different with very little margin where the driver needs to get paid

Why is this? In both cases it seems the cost is paying a bunch of servers and engineers to run a website. So why is Facebook seemingly more efficient?

Re: Uber opens at $42 per share

#379

Post by eganist »

tapland wrote: post #263
resters wrote: post #249

Earlier quoted context omitted.

No, I said it is too soon to tell, and that it has more to do with the balance of power going into the IPO.

> No, I said it is too soon to tell Your comment had no relevance for what I wrote. You said it was too soon because stock can be volatile the first week, but that it ending the week down still proves desperation. This is just not right at all.

They explained it pretty succinctly. Grossly oversimplified: the bank is motivated to accurately price in order to preserve future business from e.g. institutional investors. Overprice and your investors bleed. Substantially underprice and you leave money on the table, less likely to be picked for future offerings. Come close and everyone's generally pretty happy.

I'd be keen to hear why you believe it's "just not right at all."

Re: Uber opens at $42 per share

#380

Post by levthedev »

acdha wrote: post #363
busymom0 wrote: post #304

There's way too many comments in this thread comparing Uber's non-profitability to Amazon's which I think is quite silly. Amazon lost $2.8 billion over its first 17 quarters while Uber lost $4.5 billion in 2017 alone. Also comparing Uber to Facebook is quite silly too. Facebook had a lot more users than Uber but they are also different types of users. One is a free user with hope for targeted advertisement (in which…

Amazon is definitely misleading: they became profitable within specific business areas (e.g. books & music first) but invested that money in new businesses. The analogy would be if, say, Uber was profitable in San Francisco and Los Angeles but still bootstrapping Phoenix and Denver. I haven’t read anything which suggests they aren’t subsidizing rides in their most established markets just like everywhere else, and bo…

I believe they are, by some fairly loose accounting definition (i.e., not counting back office expenses, capital expenses, etc), profitable on non-pool rides in core US cities.
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