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Uber loses $2.9B, offloads bike and scooter business

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Re: Uber loses $2.9B, offloads bike and scooter business

#21

Post by ghaff »

paulcole wrote: post #15
martythemaniak wrote: post #9

First, they were gonna make the jump to be an autonomous robotaxi service, but that's going nowhere fast. Then they were going to be mobility service - cars, bikes, scooters, everything would go through them. But no more. So what are they going to be now? Just milk their taxi service until Waymo, Tesla or whoever comes and wipes them off the market? Honestly, what are their long-term prospects? I've been staying away…

> First, they were gonna make the jump to be an autonomous robotaxi service Anyone who fell for this is a fool. Nobody could answer the question, “How is self-driving cheaper than exploiting human drivers like they are now?”

And, furthermore, assuming the availability of self-driving at the highest degree of difficulty--namely relatively dense cities.

Re: Uber loses $2.9B, offloads bike and scooter business

#22

Post by gberger »

camjohnson26 wrote: post #3

I doubt many of Uber’s casual users understand how insanely unprofitable the current business model is. 2.9 billion is 3 unicorns. Even before COVID they’ve been losing something on the order of a billion a year. It’ll be interesting to see if they can turn this around.

> 2.9 billion is 3 unicorns.

Hmm, unicorns are usually defined by $1B valuation, while the number of $2.9B in loss is related to revenue. So I think the comparison doesn't hold, it's apples to oranges.

Re: Uber loses $2.9B, offloads bike and scooter business

#24

Post by jeffbee »

Ericson2314 wrote: post #4

I'd rather rent a bike or scooter right now than get in a stranger's car. I don't get it.

Yes, but how much will you pay? Bike rental like Jump or Lyft hasn't ever been profitable, nor should it be. It should be viewed by cities as a way to manage their street capacity, and like bus service, should not be expected to be internally profitable. This was the model of Motivate (Citibike, Bay Area Bike Share) before Lyft acquired them.

Re: Uber loses $2.9B, offloads bike and scooter business

#25

Post by rob_austin »

subsubzero wrote: post #14
gffrd wrote: post #11

Earlier quoted context omitted.

This is what I want to know. Ridesharing fares are obviously underpriced … and if they were raised 30% to make them sustainable, it becomes "not worth it" for a good chunk of people who use ridesharing as a supplement to car, bus, transit, etc. I assume the strategy is a long-play to have people + communities become wholly dependent on your services (they skip buying cars, skip learning to drive, transit fails to evo…

I think Uber is a lost cause, sorry to say but the food delivery business cannot be profitable for a majority of customers to where they will still pay for takeout. Their ATS service(self driving cars etc) was using stolen technology from waymo, now they are forced to using their own technologies they are way behind waymo, aurora, nuro, etc. Even ride hailing which is supposed to be their bread and butter is losing m…

The worst part is consumers have also lost because of uber. The promise of convenient, affordable transportation will not be delivered. Uber/Lyft rides will be more expensive than cab rides were because users have to support Uber's overhead.

Re: Uber loses $2.9B, offloads bike and scooter business

#26

Post by lucasmullens »

gberger wrote: post #22
camjohnson26 wrote: post #3

I doubt many of Uber’s casual users understand how insanely unprofitable the current business model is. 2.9 billion is 3 unicorns. Even before COVID they’ve been losing something on the order of a billion a year. It’ll be interesting to see if they can turn this around.

> 2.9 billion is 3 unicorns. Hmm, unicorns are usually defined by $1B valuation, while the number of $2.9B in loss is related to revenue. So I think the comparison doesn't hold, it's apples to oranges.

Seems like a fair comparison, they could have acquired 3 unicorn companies with that money.

Re: Uber loses $2.9B, offloads bike and scooter business

#27

Post by blackswan101 »

rossdavidh wrote: post #19
xiaolingxiao wrote: post #8

Could someone w/ an understanding of accounting add to this report? Uber is "offloading" bike/scooter business to Lime, but also making an investment in Lime... is this just a way to hide losses? Essentially paying Lime to take the red off Uber's balance sheet, while maintaining an option in the micromobility market?

IANAAccountant, but I think the investment was in the past, and this announcement is that they are ditching the investment. But I could be reading that wrong.

https://www.bloomberg.com/news/articles/2020-05-07/uber-lead...

Re: Uber loses $2.9B, offloads bike and scooter business

#29

Post by gberger »

lucasmullens wrote: post #26
gberger wrote: post #22

Earlier quoted context omitted.

> 2.9 billion is 3 unicorns. Hmm, unicorns are usually defined by $1B valuation, while the number of $2.9B in loss is related to revenue. So I think the comparison doesn't hold, it's apples to oranges.

Seems like a fair comparison, they could have acquired 3 unicorn companies with that money.

Good point

Re: Uber loses $2.9B, offloads bike and scooter business

#30

Post by opportune »

martythemaniak wrote: post #9

First, they were gonna make the jump to be an autonomous robotaxi service, but that's going nowhere fast. Then they were going to be mobility service - cars, bikes, scooters, everything would go through them. But no more. So what are they going to be now? Just milk their taxi service until Waymo, Tesla or whoever comes and wipes them off the market? Honestly, what are their long-term prospects? I've been staying away…

I've invested in uber so here's my take -

If uber leaves growth mode and makes smarter investments in new services/markets, they can be profitable. They have positive margin on ridesharing in most markets. I believe uber eats could also earn money in the short term. And I want them to continue investing in last-mile delivery (which I believe they have canceled for now).

Even though eats isn't earning a lot now, I believe that once all the money-burning food delivery startups go out of business and the market price for food delivery is no longer so depressed, it's a solid business Uber can make money on. I would prefer Uber just switch the business off in markets where it's impossible to turn a profit and just restart the networks/ecosystem once delivery prices normalize, but Uber is uniquely strong here because they are the only food delivery platform to also have a huge driver network they can easily tap into.

Last mile delivery is also very synergistic with their business and IMO it's just something they need to spend time on getting right and building relationships with big partners. Once this, eats, and rideshare are all working well together you have a really synergestic business. I think if Uber can pass on the efficiency/demand gains from these three products working in tandem to drivers, they can also work towards building a stronger moat around their network.

AV is the big unknown. However I find it much more plausible that Waymo and Tesla will vendor out the details of the rideshare service rather than build their own from scratch. Going from scratch is kind of risky, because it makes the whole venture dependent on the success of the vertical and requires good execution on getting people to actually use the service - it's much safer to simply sell the tech to automakers, rideshare, etc. since we know there is already demand for it there (I think there are also brand implications to Waymo/Google/Alphabet and Tesla that will make them hesitant to vertically integrate). Uber is of course also working on AV and in their case, they already have the messy business side of that vertical figured out, so I think their upside is a lot higher.

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