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Uber Posts $5.2B Loss and Slowest Ever Growth Rate

nytimes.com

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Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#21

Post by burtonator »

rainyMammoth wrote: post #8

Uber and lyft are both on the way down. The price at which they need to operate to be profitable is not a price that most americans are ready to pay. As simple as that. For now they delay this reality by subsidizing rides in order to generate business. In some cities like San Francisco, most incentives were removed and among my friends we all stopped using Uber (unless we really have to). It simply became way too exp…

I really hope they both implode.

The blitzscaling strategy might in fact work but it would effectively be an end to democracy. We would basically have a marketplace of ALL monopolies.

It just doesn't scale.

Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#22

Post by umeshunni »

munk-a wrote: post #10
jcdavis wrote: post #2

No doubt they are struggling to show a path to profitability, but $3.9B of that is a one-time recognition of all their stock comp which makes look much worse than it should (Assuming that a 1.3B loss is more "normal")

I am confused at how that 3.9B could be said not to matter - I'm not familiar with what precisely "recognition of stock comp" means, but I'm going to assume it was either squaring a previously deferred liability - or directly needing to pay out some sort of stock based compensation. Assuming the compensation was for a business need (like hiring labour or purchasing something necessary) then I don't see how that shoul…

Stock based compensation doesn't affect cash flow. It's newly issued stock granted to employees.

I'm not sure when the accounting laws changed to include SBC (probably post-financial crisis), but it's weird to include it in an income statement as if it was a cash expense. You can find articles from accounting experts arguing both ways if you are curious.

e.g. http://aswathdamodaran.blogspot.com/2014/02/stock-based-empl...

Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#23

Post by catacombs »

rainyMammoth wrote: post #8

Uber and lyft are both on the way down. The price at which they need to operate to be profitable is not a price that most americans are ready to pay. As simple as that. For now they delay this reality by subsidizing rides in order to generate business. In some cities like San Francisco, most incentives were removed and among my friends we all stopped using Uber (unless we really have to). It simply became way too exp…

> among my friends we all stopped using Uber (unless we really have to). It simply became way too expensive.

What's been the alternative? Regular taxis? Aren't they just as expensive?

Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#25

Post by rainyMammoth »

catacombs wrote: post #23
rainyMammoth wrote: post #8

Uber and lyft are both on the way down. The price at which they need to operate to be profitable is not a price that most americans are ready to pay. As simple as that. For now they delay this reality by subsidizing rides in order to generate business. In some cities like San Francisco, most incentives were removed and among my friends we all stopped using Uber (unless we really have to). It simply became way too exp…

> among my friends we all stopped using Uber (unless we really have to). It simply became way too expensive. What's been the alternative? Regular taxis? Aren't they just as expensive?

Let me ask you the question in another way. What did you do before Uber? Why do you see it as an essential service now?

To answer your question: I bike, use my car or use electrical scooters. I still use Uber but when I really have to (maybe once every two weeks)

Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#27

Post by dragontamer »

MuffinFlavored wrote: post #17
mikestew wrote: post #14

Uber was up for the day by 8%, too. Down 10% after hours: https://www.nasdaq.com/symbol/uber/after-hours

+8 - 10% = only a 2% drop from yesterday's price! :)

I'm not sure if you're joking... but... +8% means 108% stock price. -10% means multiply by 90% == 97.2% or a total price-action of -2.8%

This makes a bigger difference when big drops come into play. A 50% gain is offset by a 33% loss.

Re: Uber Posts $5.2B Loss and Slowest Ever Growth Rate

#30

Post by jcdavis »

munk-a wrote: post #10
jcdavis wrote: post #2

No doubt they are struggling to show a path to profitability, but $3.9B of that is a one-time recognition of all their stock comp which makes look much worse than it should (Assuming that a 1.3B loss is more "normal")

I am confused at how that 3.9B could be said not to matter - I'm not familiar with what precisely "recognition of stock comp" means, but I'm going to assume it was either squaring a previously deferred liability - or directly needing to pay out some sort of stock based compensation. Assuming the compensation was for a business need (like hiring labour or purchasing something necessary) then I don't see how that shoul…

You can break that question into 2 parts.

First, the 3.9B figure appears to represents all RSUs vested up to this point, aka many years worth ("(2) Q2 2019 includes $3.9 billion of stock-based compensation expenses, primarily due to RSU expense recognition in connection with our initial public offering"). That's why its slightly misleading - its many years worth of stock comp for employees which is all getting recognized this quarter (Happens in pretty much all the big tech IPOs)

In general though, its very reasonable to associate that as an expense, which is why GAAP requires it. Where that gets complicated is that its not an immediate cash expense to the company, hence some fudging around with non-GAAP accounting which is seen by some companies.

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