On 9th May 2019, Uber priced its initial public offering at $45 per share. Image via Pixabay
Ride-sharing firm Uber has been valued at $82 billion on its US initial public offering (IPO), or $45 a share – at the lower end of its original target range.
At that price, the company will have a market value of about $82 billion on fully diluted basis and a market value of about $75.5 billion on a non-diluted basis.
Based on a filing last month, analysts were expecting Uber to price its IPO at between $44 and $50 per share. Some early reports suggested that Uber was looking for a corporate valuation of up to $120 billion. In the end, the company took a more cautious approach by keeping the price close to the bottom of the targeted range.
Last year, Uber reported revenue of $11.3 billion and an operating loss of $3 billion
Uber no doubt wanted to avoid a repeat of rival Lyft’s IPO, which was priced strongly when it made its debut in March, but later plunged in value. Lyft’s share price is currently down 23 per cent from its IPO price in late March.
Despite being priced at the lower end of its target range, Uber’s IPO remains the largest in the US since Alibaba’s record-setting public share offering in 2014, and one of the largest of all time.
AI & Machine Learning Live is returning to London on 3rd July 2019. Hear from the Met Office’s Charles Ewen, AutoTrader lead data scientist Dr David Hoyle and the BBC’s Noriko Matsuoka, among many others. Attendance is free to qualifying IT leaders and senior IT pros, but places are limited, so reserve yours now.
“Ultimately, the success of Lyft’s and Uber’s IPO offerings will be judged based on post-IPO performance and how these companies can sustain their growth, while moving toward profitability and lowering their cash burn,” Alex Castelli, managing partner at advisory firm CohnReznick, told Reuters.
Uber was founded in 2009 and, since then, it has grown into the world’s largest ride-hailing company, offering services in more than 700 cities worldwide.
The company has also expanded into bike and scooter rentals, freight and food delivery. Uber is currently in the process of developing self-driving vehicle technology and air taxis, among other things. Cynics, however, have suggested that these initiatives are intended more to pump-up the company’s perceived value.
Last year, Uber reported revenue of $11.3 billion and an operating loss of $3 billion. The accumulated deficit of the company touched $8 billion by the end of 2018. The company also stated that it expects its negative earnings before tax, depreciation and amortisation (EBITDA) to increase in 2019 as it continues to invest.
The accumulated deficit of the company touched $8 billion by the end of 2018
Presently, a major area of concern for Uber is its relationships with drivers. On Wednesday, Uber drivers went on a strike worldwide to protest at the company’s business model, complaining that they are not paid enough.
Uber, however, argues that it has increased drivers’ incentives in recent months in a bid to maintain its position in the market.
While Uber hasn’t said anything about when it expects to achieve profitability, some investors believe that the company may start making profits when it can field fleets of self-driving vehicles – eliminating the cost of payments to drivers.
Computing and CRN have united to present the Women in Tech Festival UK 2019, on 17 September in London.
The event will celebrate successful women in the IT industry, enabling attendes to hear about, and to share, personal experiences of professional journeys and challenges.
Whether you’re the ‘Next Generation’, an ‘Inspirational Leader’, or an ‘Innovator of Tech’ this event will offer inspiration on not only how to improve yourself, but how to help others too. The event is FREE for qualifying IT pros, but places will go fast