Uber has been going through a literal PR nightmare of late. Harassment claims and a bevy of other things all combined to make the cab hailing company’s recent sojourn pretty depressing. The company is now attempting to dispel the gloom that has settled in with some well placed financial data and towards the same, has made some of it public itself – that too for the first time. Let’s take a look.
So, this massive $3.8 billion loss figure comes out to be an adjusted one, but this would be even higher on a full-GAAP basis. This means the ride-hailing giant’s decision to exit from China was definitely a wise one, else it would’ve had a huge ~59 percent loss margin in the previous year. It had been shelling out money like crazy, all in the name of competition. The same has partly been balanced out by the rapid growth in Revenue numbers.
Uber registered gross bookings of $20 billion, according to the official financial statements handed down by the ride-hailing giant to Bloomberg (this one’s not a leak). That is a huge, huge number and accounts for Close to 28 percent uptick from the third quarter to the fourth quarter of 2016. This resulted in net revenue of $2.9 billion for the fourth quarter, which is about 74 percent stronger than the third quarter. This rapid growth has been explained as under:
Revenue includes only the portion Uber takes from fares, except in the case of its carpooling service; the company counts the entire amount of an UberPool fare as revenue. The more Uber’s business shifts to the multi-passenger service, the faster revenue grows.
The aforementioned numbers are impressive as Uber was plagued with issues within the company, as well as outside during this period. It was faced with the #DeleteUber campaign twice – once when aloof Americans thought Kalanick supported U.S President Trump’s immigration ban and other when allegations of sexual harassment at the workplace came to light. This was oh-so-helpful for its American competitor Lyft, who saw a massive uptick in usage over the past three-odd months – its app peaked to #7 on the app store.
This development also comes on the heels of the recent investment picked up by Uber’s competitor. Yes, for those aloof, Lyft raised a whopping $600 million at a valuation of close to $7.5 billion. The participants for the fundraising round included existing backers like Rakuten and Janus Capital. However, it also on-boarded new global partners such as AllianceBernstein, Baillie Gifford, KKR and Canada’s Public Sector Pension Investment Board (PSP). This round brings Lyft’s total funding to $2.61 billion.
Prior to this funding round, the Uber’s competitor achieved another impressive milestone. The ride-hailing giant garnered investor interest possibly by expanding its services to even more cities in the United States. Now, this is important because the company had promised that it would make a bid to push its services to more locations, close to a 100, across the US in this year. But, it managed to expand to over 100 new locations within the first three months of 2017, which could also be due to the beating being taken by Uber.
Also, Uber for the first time decided to make its financials public. Why would a $68 billion ride-hailing company take this route? Well, the answer is simple. The company wants to showcase to the public, as well as investors, that its business continues to grow. There are sure to be losses but Uber is eyeing profitability in the near future – but we see no sign of the same at this instant.
Further, Uber CEO Travis Kalanick also mentioned that they’re not looking for a public offering and would resort to it “as late as humanly possible.” So, the move to release the financial documents suggests that the company is also looking to attract investors towards their business – whose image has been tainted due to a series of controversies, of late.
It could possibly be a major reason for the lack of fresh investments – complete contrast to the long list of investors who joined the company in its mission to revolutionize transportation. Thus, we’d have to wait and witness how far these controversies have gripped Uber and if will be able to regain its brand and trust once again.
This post first appeared on Hotstar Takes On Netflix, Launches Hotstar Premium To Offer US TV Shows And Movies, 'Unspoiled' | The Tech Portal, please read the originial post: here