If the revenue is 3.5 billion, this is basically Ubers cut from the transaction. So this is the money I paid - what Uber paid to drivers. This revenue is after incentives and coupons etc. Then how is Uber spending the 3.5 billion dollars. That is Lot of money, you certainly don't pay aws and engineers that much per quarter. I frequently hear it is incentives by that should show up on the revenue numbers right?
“I maybe losing $1 for each sale, but I’ll make up in volume”
wait.. revenue is 3.5b and loss is 5b. then they spent 8.5b in the last quarter. I don't know really what 's inside their mind willing to spend that amount of money...
4b of that 5b was from paying out employee equity. It was a one time expense.
I took some rides that cost 14c, 60c after coupons. The good days are gone and now it’s only 25% off. Does Uber pay drivers the same no matter what promos the rider has?
Yes. You coupon is from Uber, not the driver
Also, new drivers get like $1k bonuses pretty easily
Much of it was stock based comp which the market was aware of from their S-1. For the remaining losses, incentives for drivers and riders eat away at their margin. Lyft alluded to the price war with Uber dying off on their earnings call but I don’t buy it. Both companies run promotions quite regularly, if not all the time. It’s a race to the bottom which is good for consumers but not good for investors/employees. I’d imagine ATG has huge R&D expenses with limited current revenue. They’ve also went after a hyper-local strategy to expand into new cities but that creates a lot of bloat(thus layoffs). Uber folks were citing Eats as a shining beacon but food delivery has similar dynamics as ride sharing (low switching costs for supply and demand and undifferentiated services) leading to stiff competition, price wars and eventually consolidation. I had shorted Uber pretty heavily as they were clearly overvalued. Hoping for the best for folks still there though.
EBITDA losses were “only” 680MM. Almost all of that came from EATS and ATG. Core ride sharing was in the red by 100MM which if you look at the overall ride sharing revenue, it shows that the core business is almost there with break even/profitability.
But where is all the revenue money going even for ride sharing? 3.5 billion is the money Uber took from users payments minus driver fees. I'm trying to estimates the health of the business..
Marketing, R&D, insurance/payment costs. Ride sharing will always be a low margin high volume business. As I mentioned, it’s close to break even now so it’s fairly healthy
Fyi, Uber is less than 10c increase per trip to break even.
3000 mid level engineers is ~1 billion. Probably another billion for directors, principals, etc. And another billion for executive team.
Lol they don’t pay the exec team $1 billion/quarter