Uber CEO Dara Khosrowshahi. Photo by Bloomberg
Uber/Lyft

Uber Makes Big Promises in IPO ‘Road Show’

Photo: Uber CEO Dara Khosrowshahi. Photo by Bloomberg

Uber CEO Dara Khosrowshahi and CFO Nelson Chai have told investors attending the company’s IPO road show presentations that they expect the company to one day earn a profit margin of 25%, before the impact of interest, taxes, depreciation and amortization after “competitive pressures” subside, according to two people attending presentations and a video shown to prospective investors. That’s a far cry from where things stand today: Uber had a negative margin of 31.4% in the first quarter.

And the executives revealed that Uber this year will lose more money, before interest, taxes, depreciation and amortization, than the $1.8 billion it lost in 2018. The increased loss will reflect its heavy spending on subsidies for drivers and coupons for riders in order to protect its market share. A year ago, Uber had projected it would shrink its Ebitda losses this year by two-thirds, to $500 million. Increased competition in ride hailing and food delivery have changed that.

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