There’s a lot riding on India, reveals Uber’s IPO filing

Daniel Fowler
April 14, 2019

In the fourth quarter of the year, Uber's drivers completed 1.5 billion trips.

Following in rival Lyft's footsteps, Uber on Thursday filed the requisite paperwork with the Securities and Exchange Commission for its initial public offering. But user growth, which had risen 51 per cent in 2017, also slowed.

Uber's ride-hailing business, which is its primary calling card, generated $9.2 billion in revenue in 2018, with gross bookings of $41.5 billion over the course of the year, according to the filings.

Investment bankers had previously told Uber it could be worth as much as $120 billion. It comes as rival Lyft has struggled after going public earlier this month, as investors question whether it can actually make money.

The move is intentional, Uber Eats notes in its S-1 SEC filing. Investing in these companies as they make their stock market debuts can seem a way to easy riches.

After making the public filing, Uber will begin a series of investor presentations, called a roadshow, which Reuters has reported will start the week of April 29.

Its unprofitable history may force Uber to eventually raise its ride-hailing prices unless it can reduce its costs by shifting to driverless cars or expand into other markets and lines of business.

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The company is on its way to price its IPO and start trading on the New York Stock Exchange in early May.

Last year, the ride-hailing giant settled a legal dispute over trade secrets with Alphabet Inc's Waymo self-driving vehicle unit.

While Uber has yet to disclose the exact valuation it is seeking, it could pull off one of the largest-ever initial public offerings (IPOs) in the tech world. Its fast-growing food delivery business, which spans 500 cities globally, doubled its revenue to $757 million in 2018 from $367 million in 2017. Analysts consider building scale crucial for Uber's business model to become profitable.

Those have included sexual harassment allegations, a massive data breach that was concealed from regulators, use of illicit software to evade authorities and allegations of bribery overseas.

The blowback from the problems assisted Lyft pickup ground in the US - a thing Uber acknowledged in its own filing - and contributed to the ouster of both Uber co-founder Travis Kalanick since CEO in 2017. For context, Uber has been exiting markets like China, Southeast Asia and Russian Federation by merging operations with rivals who were forcing the company to burn more capital for competitive reasons.

Outside the US-Canada combine, according to the miles of rides covered, Europe is the largest market (271 million) for Uber followed by Latin America (94 million), Japan/South Korea (79 million), and Middle East & Africa (74 million). The company claims more than 65 percent market share in the United States and Canada, versus Lyft's stated 39 percent in the United States.

After Lyft (LYFT) went live on Nasdaq less than two weeks back at the end of March 2019, Uber is finally bringing preparations for their IPO to an end, which means that the ridesharing magnum might be out in the market already in May 2019.

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