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Uber Loses $900 Million In Second Quarter; Urged By Investors To Sell Off Self-Driving Division (bloomberg.com)
Last week, Uber reported a second-quarter loss of $891 million, even though it brought in $2.8 billion in revenue. "While it's a 16 percent improvement from a year earlier, the loss follows a rare profit posted in the first quarter, thanks largely to the sale of overseas assets," reports Bloomberg. As a result, the company is being pressured by investors to sell its self-driving cars unit, which Uber is spending $125-200 million a quarter to maintain. From the report: Even after increased spending last quarter, revenue growth is slowing. Sales rose 63 percent to $2.8 billion in the second quarter compared with the same period last year. The rate in the first quarter was 70 percent. [Uber CEO Dara Khosrowshahi] Khosrowshahi is pouring large, undisclosed sums of money into food delivery, logistics and autonomous-car technology. The San Francisco-based company has said the food delivery business, Uber Eats, represents more than 10 percent of its gross bookings. Growth in that segment may be masking a slowdown in Uber's main business.
On one hand, it's interesting how investors are really interested in companies bing a one trick pony. They are investing in a "ride sharing" (LOL) company. They are not interested in a company that does ride sharing AND self driving. If they wanted a self driving car company, they would invest in a self driving car company.
On the other hand, it's interesting how companies refuse to be one trick ponies. Uber saw the writing on the wall. They know in a few years it will be all about self driving. They wan't to be ready for the change. Being first to game is the key.
Basically you have to shake investors off as soon as you can. These people are interested in "money now" as opposed to "money later". This is why companies that operate at a loss all the time have little future.
Uber CEO Dara Khosrowshahi] Khosrowshahi is pouring large, undisclosed sums of money into food delivery, logistics and autonomous-car technology.
"Throw shit at wall; see what sticks." -Unimaginative moron with finance degree
It really amuses me to watch these VC's incompetently try to monetize every aspect of our fucking existence... they won't be happy until they're the middlemen making 25% on all our transactions coming and going.
Fuck 'em with a huge stick... bigger even than they enjoy.
As long as people 'invest' their money willingly and executives get rich, capitalism doesn't see a problem with it.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
because long term somebody is going to crack down on their flagrant abuse of the term 'contractor' and eventually make them treat their employees as such. Their plan is to replace the employees before it becomes an issue. But even if they never build a self driving car they're going to need patents to defend themselves and eke out favorable license deals with..
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Uber does not need to be the inventor of the self driving car. They only need to be a user of the self driving car. And frankly they are behind in self-driving R&D and doing a crappy job at it as well.
How is this even possible?
Seriously. Look at their business model. They have a frakin' smartphone app. They don't own the cars or have employees and they take a 25% cut of every ride.
Please tell me how they can spend $3Bn a year in the first place? What are they spending it on? Two college kids in dorm room could write the app and keep it updated.
Mike
Mike @ The Geek Pub. Let's Make Stuff!
The self driving division is a vanity project. Their R&D is behind others and they are doing a crappy job at it in general.
Replacing drivers is absolutely the goal but they can do that with a self driving car that someone else invents.
The short term stock investors seeking instant profit sure make it difficult for a company to do any sort of long term growth plan or invest in anything for a potential future.
errr....umm...*whooosh* *whoosh* Is this thing on ?
Bad quality software is everywhere nowadays ; it's only when faulty software kills that people realize programming requires skills.
Slashdot, fix the reply notifications... You won't get away with it...
Also, six taxi drivers have already committed suicide as their medallions become worthless, other cities are using taxpayer money to compensate taxi drivers. Huge messes to figure out.
Times change. We advance. We can't be held hostage to the old ways. If we worried about that we'd still be driving horse and buggies around because the wheel makers (blacksmiths) and horse breeders would have lost their jobs.
Mike @ The Geek Pub. Let's Make Stuff!
You still can't take a person's livelihood and throw it in the dumpster. They trusted their jurisdiction to uphold the laws. It's not like they were participating in a known risky venture like investing. How would you feel if Uber decided to make your house a parking lot and the city gave them approval to bulldoze it without any compensation for you?
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Times change. We advance. We can't be held hostage to the old ways. If we worried about that we'd still be driving horse and buggies around because the wheel makers (blacksmiths) and horse breeders would have lost their jobs.
You still can't take a person's livelihood and throw it in the dumpster. They trusted their jurisdiction to uphold the laws. It's not like they were participating in a known risky venture like investing.
What? Yes, that's exactly what they were doing. They invested in their own business, which was risky given the prospects for that business going forward. As an investor in their business, they are responsible for being familiar with the risks involved, and investing accordingly.
Just another reason why we need UBI, so that when people get those things wrong, they don't wind up on the street — which winds up costing everyone money.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
... I am also doubtful on those cost from Uber are on development or AWS cost. No, far more likely they are spending the crushing majority 90%+ of that on 1) marketing and 2) subsiding the price of share down to try to crush competition and 3) as a minor cost comapred from the previous 2 the self driving research.
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You may well be correct that practical automated driving is too far off to throw so much money at today. I do not know, I can only guess.
However, not getting the game and being wrong could cause the Uber company valuation to evaporate to nothing. Rides are a commodity. And if Apple or Google or Walmart or Ford can offer an app that provides a cheaper ride than Uber, Uber is over.