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Uber files for IPO even as it continues to lose money

Uber files for IPO even as it continues to lose money
[Photo: Scott Olson/Getty Images]

After much anticipation, Uber has filed to go public. The company did not disclose how much it is planning to raise, though it was last valued at $76 billion and there have been reports it could raise $100 billion.

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Uber grew its revenue from $3.8 billion in 2016 to $11.2 billion in 2018, but at the end of 2018, it had a loss of $1.8 billion. The company also grew its consumer base to 91 million Monthly Active Platform Consumers worldwide. And it sees massive room for growth, noting that “only 2% of the population in the 63 countries where we operate used our offerings in the quarter ended December 31, 2018, based on MAPCs,” according to its prospectus. However, there’s no obvious path to profitability represented in its S-1.

“We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability,” the company wrote in its filing.

Uber has achieved massive growth globally and claims a roughly 70% marketshare in the U.S., but it is still very much competing with Lyft and spending commensurately to keep its edge with consumers. While Uber has struck deals with several global rideshare companies, it still faces competition outside the United States, especially in India. The ride-hail company has also put a lot of investment into building out its brand beyond taxi services. Uber now hocks shared bikes and meal delivery as well. In 2018, Uber Eats, its most talked-about business, had gross bookings of $7.9 billion.

Across its businesses, Uber had gross bookings of $49.8 billion for the year, which is to say, Eats is a growing part of the company’s overall business. There is potentially room to grow here, but food delivery is also a highly competitive space. Uber Freight, meanwhile, took in $359 million in gross bookings for 2018.

The filing with the Securities and Exchange Commission comes on the heels of Lyft’s IPO, which debuted at $86 per share. The stock closed today at $61.01 per share.

Correction: this article has been updated to reflect Uber Eats annual gross bookings for 2018. A previous version stated its Q4 2018 quarterly gross bookings.  

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