This year is not ending on a high note for Uber. In August, the company signaled retreat in China. Next, experts started questioning Uber’s sky-high valuation. ($62 billion and counting.) Then last month, two banks passed on the opportunity to sell Uber shares to high-net-worth clients when the company declined to provide net income or annual revenue data, raising red flags about its financial performance.
Now a new analysis of Uber’s financial documents suggests that ride subsidies cost the company $2 billion in 2015. On average, the analysis suggests, Uber passengers paid only 41% of the cost of their trips for the fiscal year ended in September 2015.
Thus far, Uber has justified its losses as part of an aggressive growth strategy aimed at capturing market share. But at some point, investors will expect to see the company right-size its unit economics.