Uber losses top $1bn in run-up to IPO
Uber has posted a loss of more than $1bn (£780m) in its latest quarter as growth in bookings continued to slow in the run-up to its stock market flotation next year.
The San Francisco-based ride-sharing firm, valued at $76bn, is under pressure to improve its financial performance before the IPO. It lost $1.07bn in the three months to September, a 20% increase from $891m in the previous quarter.
The firm, which has never made a profit, could target a valuation of $120bn when it lists on the New York stock market next year – three times the value of the carmaker Ford. Uber counts Japan’s SoftBank and Saudi Arabia’s royal family among its biggest investors.
The latest quarterly loss is down more than a quarter from a year ago, when the company posted its biggest publicly disclosed quarterly loss after the departure of Uber’s co-founder and chief executive, Travis Kalanick.
Bookings rose 6% from the previous quarter to $12.7bn, marking the third quarter in a row they have grown in single digits. Growth has slowed sharply from double-digit rates last year and near-30% growth in late 2016. Revenues rose 5% to $2.95bn.
Faced with this slowdown in its decade-old ride-hailing business, Uber is accelerating its expansion into food delivery, called Uber Eats, along with freight hauling and electric bikes and scooters. Under the chief executive Dara Khosrowshahi, who took over from Kalanick, Uber has also retreated from some markets where it has suffered losses.
Nelson Chai, Uber’s chief financial officer who joined in September to fill a role that had been vacant for three years, said: “We had another strong quarter for a business of our size and global scope.
“As we look ahead to an IPO and beyond, we are investing in future growth across our platform, including in food, freight, electric bikes and scooters, and high-potential markets in India and the Middle East where we continue to solidify our leadership position.”
However, the company could be forced to merge with rivals in India and the Middle East. Uber and the India-based Ola are both backed by SoftBank which is Uber’s biggest single shareholder with a 15% stake. The investment came with a provision that requires Uber to file for an IPO by 30 September 2019.