Uber reveals massive losses ahead of market debut

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Uber has lost nearly $8bn (£6.1bn) during its 10 years of existence, according to documents released ahead of its debut on the stock market.

The ride-hailing firm also disclosed that government authorities and regulators in the US are investigating a year-long cover-up after the details of millions of passengers and drivers were stolen in 2016.

Uber chief executive Dara Khosrowshahi said: “Some of the attributes that made Uber a wildly successful startup – a fierce sense of entrepreneurialism, our willingness to take risks that others might not, and that famous Uber hustle – led to missteps along the way.”

Mr Khosrowshahi, who took over the company 18 months ago, has vowed to run it with integrity.

The bankers handling Uber’s IPO (initial public offering) are expected to reveal a pricing range for the firm’s shares later this month, ahead of it trading on the New York Stock Exchange in May.

It is expected to be the biggest technology IPO since Chinese e-commerce giant Alibaba Group went public in 2014.

Uber’s operating losses declined from $4bn (£3bn) in 2017 to $3bn (£2.3bn) in 2018.

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SharesPost analyst Alejandro Ortiz said: “They’re showing that they’re capable of controlling their costs, which has been a concern of ride sharing companies in general.

“That’s a sign that will be looked on favourably in the next few weeks.”

Image: Uber’s food delivery service is one of its bright spots, operating in 500 cities globally

But, like its rival Lyft, profitability has been a challenge for Uber.

One of the main problems is drivers’ wages, a huge expense made harder to control by the fact that drivers can easily move between the two businesses.

But Uber has been investing in self-driving vehicles, building more than 250 of the vehicles and staffing its self-driving division with more than 1,000 people.

A bright spot was Uber’s food delivery business, which is in 500 cities around the world and doubled its revenue to $757m (£579m) in 2018 from $367m (£280m) in 2017.

Lyft entered the stock market in March raising $2.3bn in its IPO, but its stock now sells for around $61, down from its original price of $72.

Uber, which operates in 65 countries, expects to raise around $10bn, according to the Wall Street Journal.

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