Uber lost 'over $3.2b' in first nine months

Uber has stayed mum about its financial performance even as its valuation has soared to US$69 billion, making it more valuable on paper than General Motors and Twitter combined.
Uber has stayed mum about its financial performance even as its valuation has soared to US$69 billion, making it more valuable on paper than General Motors and Twitter combined.PHOTO: REUTERS

But its revenue kept growing even after it exited China market

BEIJING • Even as Uber Technologies exited China, the company's financial loss has remained eye-popping. In the first nine months of this year, the ride-hailing company lost significantly more than US$2.2 billion (S$3.2 billion), according to a person familiar with the matter.

In the third quarter, Uber lost more than US$800 million, not including its Chinese operation.

At the same time, the company's revenue continued to grow even after leaving the world's most populous country. Uber generated about US$3.76 billion in net revenue in the first nine months and is on track to exceed US$5.5 billion this year, said the person, who asked not to be identified.

San Francisco-based Uber has stayed mum about its financial performance even as its valuation has soared to US$69 billion, making it more valuable on paper than General Motors and Twitter combined. 

Uber's bookings - the total combined value of the fares that riders pay - were US$5.4 billion in the third quarter, an increase from US$5 billion in the second quarter and US$3.8 billion in the first, according to the person. 

The slowdown in Uber's booking growth can be partially explained by its decision to leave China. Uber said on Aug 1 that it came to an agreement with Didi Chuxing to exit China in exchange for 17.5 per cent of the Chinese company.

As part of the deal, Didi invested US$1 billion in Uber. Uber's third- quarter financials do not include the China business, which was part of the previous quarterly results. 

The slowdown in Uber's booking growth can be partially explained by the company's decision to leave China. Uber said on Aug 1 that it came to an agreement with Didi Chuxing to exit China in exchange for 17.5 per cent of the Chinese company.

Net revenue - the amount Uber generates after it pays its drivers - was US$1.7 billion in the third quarter, up from US$1.1 billion in the second quarter and US$960 million in the first, the person said. 

Uber's financials have leaked in dribs and drabs. The third-quarter data was reported by the technology site The Information. An Uber spokesman declined to comment.

The company is said to have lost at least US$2 billion last year and is on track to pile up a loss of at least US$3 billion this year. Those are rough figures that may underestimate how much money Uber is losing and do not include interest, taxes or stock-based compensation.

Uber's loss in the first quarter was about US$580 million, according to the person. By the second quarter, the loss significantly exceeded US$800 million, including China. That number is likely far higher.

Even in its home market, the US, Uber continues to lose money. After turning a slight profit in the first quarter, Uber lost US$100 million in the second quarter. The loss rose in the third quarter, the person said.

Lyft, Uber's largest US competitor, has promised investors that it will keep its losses below US$150 million a quarter.

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A version of this article appeared in the print edition of The Straits Times on December 21, 2016, with the headline 'Uber lost 'over $3.2b' in first nine months'. Print Edition | Subscribe