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Uber Q3 Results

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Re: Uber Q3 Results

#161

Post by scarface74 »

gok wrote: post #159
TheCoelacanth wrote: post #153

Earlier quoted context omitted.

EBITDA is a wipespread (though still somewhat sketchy) practice. "Adjusted EBITDA" is just making up fairy-tale numbers.

Which adjustments in particular do you find deceptive in Uber's case?

They aren’t “deceptive”, they spell out how they arrived at those numbers, they disclosed that they aren’t GAAP and did all of the other disclosures that anyone who knows how to read financial statements would understand and should be able to make a judgement call on how to weight them.

I’m more calling out the tech industry in general and some posters on HN specifically about how they sugar coat the performance of money losing present and former unicorns and they don’t measure success by profitability or at least marginal profits where you could see a clear road to profitability.

Dropbox for instance is a YC/HN darling. It is one of only two YC funded companies to ever go public, has never been profitable and looks like it’s going to be squished as other players like Microsoft, Google and even Apple make their entire business “just a feature”.

Re: Uber Q3 Results

#162

Post by skinnymuch »

wasdfff wrote: post #149
skinnymuch wrote: post #133

Earlier quoted context omitted.

There is a good chance suburban areas would not have ride sharing for a long time if that happened. All the alternatives popping up would be in cities and dense urban areas for a long time. Or if they get them, they might just be priced worse than the taxis.

Suburban areas already suck for ride shade. Try hailing a lyft in the proper suburbs, should take you over a half hour.

What is a proper suburb to you? Ride sharing is great for me in suburban areas of Delaware before as one example. Wait can be 15-20 min sometimes. Though it shouldn’t be like that all the time. You can still see where the driver is, etc, via app. The price is cheap (I’d be willing to pay more). The experience is far better than hailing taxis used to be.

Suburban life is also different from city life. A 15-20 min isn’t that bad in suburbs.

Life has become a lot more convenient currently for me in suburbs knowing ride sharing is around. I almost shivered thinking about the last time I used a taxi a decade ago in suburbs.

Re: Uber Q3 Results

#163

Post by arcticbull »

greggman2 wrote: post #102
arcticbull wrote: post #96

Earlier quoted context omitted.

Frankly they're basically interchangeable. I'm not sure what you mean by a company "so blatantly bad" -- most of the drivers in SF at least drive for both Uber and Lyft. You can use either app and end up with the same driver, in the same car, offering the same exact experience at a practically indistinguishable price point. Uber at least seems to know people are mad at them and offer excellent customer service. Now,…

By bad I meant doing bad things uber has done. https://www.google.com/search?q=bad+things+uber+has+done

That's a pretty hilarious google search string :) I wasn't sure if you were complaining about them as a service or the way they run their business. The latter certainly has plenty of fodder.

Re: Uber Q3 Results

#164

Post by not_a_cop75 »

ganitarashid wrote: post #17

Having new “one-time” charges every quarter means those are not one-time charges. They’re part of the business, which means the business doesn’t work. One of Ubers biggest problems is that they have zero brand loyalty. For a company that sells a utility (get me, or my food, from A to B) rather than an experience (like a cool vacation in a unique mansion), I will always pick the cheapest option. Whether that’s Uber or…

I really hate Uber, but you're partly wrong. Brand loyalty works when there isn't a competing brand of similar quality. So Uber at worst will always be second choice. Driving is getting cheaper as better cars are built, but they have to work against inflation, which is not real value, but you'll measure that anyway. Lastly, Uber can limit their fleet to efficient cars and effective drivers if they want. This should limit costs, but I think this happens almost naturally without them doing too much.

Re: Uber Q3 Results

#165

Post by henrikschroder »

mikemotherwell wrote: post #62
henrikschroder wrote: post #59

Earlier quoted context omitted.

> Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. Back when Uber was new and everyone in SF was exclaiming how awesome it was and disruptive, one of the major taxi companies in Stockholm launched a new version of their app that basically had a big button going "I want a taxi to my location now", and you pressed it, and you got a "Hey, your taxi will arrive…

There are way more positives than that: # No money changes hands, so safer for drivers. # No payment is made in the vehicle, so faster exit times. # Uber records all trips, so easier to work out costs to expense. # Uber uses any credit card, so your boss can pay for your ride without the need for separate expensing. # Driver and passenger are tracked, so there it is easy to find who did what. There are a lot of rape…

> No money changes hands, so safer for drivers.

All their taxis do card payments, and have done card payments for decades before Uber.

> No payment is made in the vehicle, so faster exit times.

They didn't have that option when they launched the app with GPS booking, but they added it later. It now works just like Uber, you have cards on your profile, it charges your chosen card after the trip.

> Uber records all trips, so easier to work out costs to expense.

Of course they can email you your receipts if you want.

> Uber uses any credit card, so your boss can pay for your ride without the need for separate expensing.

So does this taxi app. Companies can also have accounts with the taxi company, so if it's a work trip you just use the company account that you've already entered into the app.

> Driver and passenger are tracked, so there it is easy to find who did what. There are a lot of rape charges and cases against Cabbies.

There are not a lot of rape charges and cases against cabbies in Stockholm, at all, so that's not a problem to solve.

> Rating - I've been in a LOT of awful, awful cabs.

Taxis in SF are godawful compared to taxis in Stockholm, so yeah, if you're used to the shitty cabs of SF, Uber is a step up. If you're used to pretty much every single taxi being a Mercedes like in Stockholm, Random Dude's Toyota is a step down.

> Drivers can work 1 hour and make some money. Try that with any other job.

That doesn't affect me as a customer, really. Also, when I get in a taxi in Stockholm I know I'm getting a properly licensed and insured ride, not just some gung-ho gig-economy hopeful who is driving his Toyota an hour a week.

Like I said, I understand that Uber was a step-up for the SF taxi market, but there are plenty of markets where it isn't, and where it's much-hyped technological invention just isn't very hard to replicate for local competition.

Re: Uber Q3 Results

#166

Post by gok »

scarface74 wrote: post #161
gok wrote: post #159

Earlier quoted context omitted.

Which adjustments in particular do you find deceptive in Uber's case?

They aren’t “deceptive”, they spell out how they arrived at those numbers, they disclosed that they aren’t GAAP and did all of the other disclosures that anyone who knows how to read financial statements would understand and should be able to make a judgement call on how to weight them. I’m more calling out the tech industry in general and some posters on HN specifically about how they sugar coat the performance of m…

I agree that the industry would be healthier if companies tried to become viable/profitable earlier. I think in particular many took the wrong lesson from Amazon's ability to grow without making money for ~20 years.

Re: Uber Q3 Results

#167

Post by georgeecollins »

adjkant wrote: post #67
georgeecollins wrote: post #10

You have to go past a lot of non-GAAP accounting to see that they actually lost $1.1B last quarter, almost all from operations. There is a nice chart showing all the things they are taking out to get their adjusted EBITDA of -0.5B. It seems like they are always taking out a bunch of one time charges to claim that there core business would be profitable. But every quarter they have those charges. I don't understand ho…

Stock based compensation is a big chunk of that which arguably doesn't really cost Uber anything really. I think the bigger takeaway is that its STILL 500 million dollars lost per quarter which is insane.

That makes sense. I see based on p. 28 - 29 it looks like they spent about ~500m in this quarter on stock based compensation. So I guess the argument would be if they have more salary type employees and they blew off some of their new money losing divisions they would be closer to break even.

I think you can argue that in the long run Uber doesn't need to be more high tech than FedEx or WalMart. They are an app powered by logistics. You maybe don't need to offer Silicon Valley incentives to do that in the long run.

Re: Uber Q3 Results

#168

Post by jpalomaki »

ganitarashid wrote: post #17

Having new “one-time” charges every quarter means those are not one-time charges. They’re part of the business, which means the business doesn’t work. One of Ubers biggest problems is that they have zero brand loyalty. For a company that sells a utility (get me, or my food, from A to B) rather than an experience (like a cool vacation in a unique mansion), I will always pick the cheapest option. Whether that’s Uber or…

Might be different in other markets, but in my home city picking the best (price, time) ride is not so easy. The time it takes for the car to arrive varies a lot. In all the services available I need to first place the order, then they find the car and after that I get estimate how long it takes to arrive. I can cancel and try another one, but that’s quite inconvenient. Also the time estimates seem to be fairly optimistic.

At least on my case this means that I’m not always trying to pick the cheapest option, but instead go with the option that has had good price/performance ratio in the past.

Re: Uber Q3 Results

#169

Post by MuffinFlavored »

1123581321 wrote: post #72
MuffinFlavored wrote: post #64

Earlier quoted context omitted.

> I will always pick the cheapest option. My friend's sister got hospitalized after her Uber driver ran a red light because they were not privy to traffic queues most normal people would have caught on to (like stopping when a light is turning red) I will gladly spend a couple extra bucks the ~20 times I need to Uber a year so that I am not getting into a screaming metal death trap with an unfit driver.

It’s not clear what you are spending extra money on or how you are evaluating driver aptitude. What about Uber’s driver requirements doesn’t work for you?

I wouldn't feel comfortable knowing Uber cut driver wages to beyond razor thin because I'd question if the driver (who is willing to work for next to nothing) is qualified to safely drive me around.

Re: Uber Q3 Results

#170

Post by adjkant »

cco wrote: post #84
adjkant wrote: post #67

Earlier quoted context omitted.

Stock based compensation is a big chunk of that which arguably doesn't really cost Uber anything really. I think the bigger takeaway is that its STILL 500 million dollars lost per quarter which is insane.

What do you mean it doesn't cost them anything?

https://www.ft.com/content/6999dc72-893e-11e9-97ea-05ac2431f...

This explains it decently IMO

> Assume that you own a business that has an overall value of $100m and generates $10m in annual income, and that you hire me as your manager. Assume also that my compensation is $1m and that rather than pay me with cash, you give me 1 per cent of the business as compensation. While you may maintain the fiction that this is a non-cash expense and that your income is still $10m, you are now entitled to only 99 per cent of that income in perpetuity. In effect, your share of the business is worth less and it will get even smaller over time, if you continue to pay me with equity. But if you are a common stockholder in any company that grants options or restricted stock to its employees, then you are in exactly the same position.

While it's obviously bad for shareholders, it basically dilutes their profits in the future, but if those never come, who cares about that dilution? I think it would affect my opinion of the stock long term, but short term any way they get towards profitability minus stocks is a way that someone actually sees a dividend.

But of course, most people actually looking to buy and sell individual stocks won't really care a ton about the dividends IMO. And it's not like people really use voting rights today on tech stocks even if they are offered. It's always fascinated me that stock games like that really come down to just betting on future performance compared to the opinions of others. It's comically confidence based and nothing else.

So if Uber were to eve somehow reach profitability minus stock compensation, their business itself could actually take advantage, even if the shares of others were diluted in terms of dividends.* So if you're buying and selling stocks individually in the current pattern, Uber hitting that middle zone of technically nonprofitable but adjusted profitable would be a good sign for long term resilience, however that factors into the current confidence equation.

How the stock market hasn't been classified as gambling at this point is wild to me.

*I'm actually not personally clear on if it is a dilution or those specifics, its surprisingly hard info to find online easily. One thing is clear though: the company's cash flow itself is not affected at all.

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