
Uber reportedly lost $891M in the second quarter of 2018 as growth slows - dralley
https://www.theverge.com/2018/8/15/17693834/uber-revenue-loss-earnings-q2-2018
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chx
This is very small money to be invested to dismantle all the protections
organized labor achieved in the last hundred plus years. I must congratulate
the investors. Maybe it didn't start that way but certainly now this is now
what it is.

~~~
quickben
Interesting.

So, did they succeed? Are cabbies dismantled now?

If the vcs stop pumping bil/year, will Uber exist?

I don't care about Uber or the Taxi industry, I am trying to point out that
better replaces existing, and so far, that hasn't happened in the case of
Uber.

Except for the entire planet getting some free rides, that part is awesome.

~~~
londons_explore
If VC's stop pumping money, Uber might not exist, but I highly doubt the
'ridesharing market' is going away.

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pdeva1
Can someone genuinely explain this: How is that Uber continues losing cash but
is about to IPO, but when MoviePass tries to do the same, its about to go out
of business.

~~~
mrep
The main reason is unit economics. Uber is profitable in established markets
however it is costly to incentivize the initial driver pool in a new area to
drive around hoping for customers where customers do not expect there to be
uber drivers. They also need to spend money to market their service to
customers once they have paid enough drivers to be available even when
customers aren't requesting uber fares.

If uber drivers are not available locally, you won't use them. However, when a
local market has lots of users who expect to use the service and are able to
find local drivers, it becomes self sustaining and uber no longer needs to
subsidize drivers and market customers as much and so they can rake in their
fees.

TLDR: they were able to raise a lot of money because they showed that while it
costs a lot to grow to new LOCAL markets, they eventually make money on each
user and it becomes self sustaining.

Moviepass on the otherhand loses money on almost every customer because they
priced their service below what it costs to go to 2 movies a month and hoped
that in the end, users would keep paying even if they did not use it more than
twice a month (somewhat similar to some gyms business model), or they could
strongarm movie theaters into giving them lower fees so that the 2/more movies
watched per month per user became profitable.

~~~
pdeva1
Can you point to any reference that mentions the profitablity in established
markets? All the articles I see say that unit economics remain unprofitable in
all cases.

~~~
mrep
[0]:
[https://www.ft.com/content/afa1d4de-33bc-11e6-bda0-04585c31b...](https://www.ft.com/content/afa1d4de-33bc-11e6-bda0-04585c31b153)

[1]: [http://fortune.com/2016/06/16/uber-profitable-
markets/](http://fortune.com/2016/06/16/uber-profitable-markets/)

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rohitb91
How does Uber even lose that much money while paying their drivers on average
$3.5 per hour and offering no benefits or safety nets?

I wonder if a downturn will be what it takes for Uber to finally die.

~~~
dantheman
Uber pays more than $3.5 an hour. Where are you getting that number?

Uber and other ride sharing services are so much better than taxis, why would
you want them to die? Uber's international support is amazing and has made
international travel far more safe and convenient.

~~~
nickserv
Please don't call it "ride sharing", which is when 2 or more people going to
the same place share the cost of transportation. There is no profit motive
involved.

What Uber and others do is an unlicensed/subcontracted taxi service.

~~~
point78
Half of these "sharing" economy services have nothing to do with sharing...

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ebikelaw
They can't just jettison the self-driving unit because that torpedos their
long-time valuation strategy. Of course, their car doesn't work so they will
eventually have to shut it down. That leaves them in the same place I've
always said that Uber would end up: a radically smaller company retrenched in
existing, profitable markets. Softbank will take a bath and the smart money
already exited.

~~~
xkcd-sucks
Its fundamentally a logistics company, why does the valuation depend on uber
not buying self driving cars from a third party?

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curiousDog
$891 million*. Incorrect title

~~~
dang
Fixed now. Thanks!

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hugh4life
"The company’s self-driving unit continues to be a drain on cash"

Uber should not have a self-driving unit. Self driving cars are only going to
be safe to use on infrastructure specifically made and certified for self
driving cars. That's going to take massive government investment that probably
isn't going to come any time soon. You're only going to see self driving cars
in say intentionally created smart cities any time soon.

~~~
tim333
You can see them in Phoenix just now
[https://www.bloomberg.com/news/features/2018-07-31/inside-
th...](https://www.bloomberg.com/news/features/2018-07-31/inside-the-life-of-
waymo-s-driverless-test-family)

~~~
oldgradstudent
I wouldn't call a car with a driver "a self driving car".

~~~
mr_toad
Waymo have already started testing cars with no backup drivers. They’re years
ahead of the competition, even GM are 2-3 years behind Waymo, and Uber is
probably more years behind them.

~~~
oldgradstudent
As expected, turns out that cars without a driver are remotely monitored.

[https://www.theinformation.com/articles/waymos-big-
ambitions...](https://www.theinformation.com/articles/waymos-big-ambitions-
slowed-by-tech-trouble?shared=4596b7125469ea51)

At this point in time there are no driverless cars.

