Uber's numbers seem ugly either way you look at them
Jun 30, 2015, 07:29 IST
Chris Ratcliffe/Bloomberg via Getty ImagesTravis Kalanick, chief executive officer of Uber Technologies Inc., speaks during the Institute of Directors (IOD) annual convention at the Royal Albert Hall in London, U.K., on Friday, Oct. 3, 2014. Uber's financial performance is shakier than previous reports suggested, based on the leaked numbers reported by Bloomberg on Tuesday. The numbers, which Bloomberg said were part of a term sheet for a bond offering that Uber is planning, provide a rare glimpse into the popular ride-hailing business' money-making machine.According to Bloomberg, Uber had revenue of $415 million (we assume net revenue after payments to drivers, not gross revenue) and an operating loss of $470 million.It's an incomplete glimpse into Uber, as the numbers are missing one major piece of context: the time period that the financial results correspond to. It's unclear whether these are financial results for a single quarter, for a whole year, or for some other period of time. Nor do we know how fresh the numbers are - an Uber spokesperson told Bloomberg they are "substantially old," which suggests they come from 2014. It's also not clear where the numbers originated - Uber told Fortune that the prospectus in question was not distributed by Uber, but didn't comment further on their accuracy. Still, the numbers present some worrying signs whether they are viewed as quarterly or annual results. If one assumes that the numbers correspond to one single quarter's financial results, then Uber appears to be losing some serious money. That's because if you create an annualized run-rate based on those numbers (multiply by four), Uber's annual operating loss is nearly $2 billion. Of course, there are plenty of caveats to assuming that Uber is actually losing that much money on an annual basis given how little we know. The one-quarter snapshot may have been an anomaly; perhaps Uber ramped up its spending that quarter and sustained a much greater than normal operating loss. Still, it's reasonable to at least consider the possibility that Uber is operating at that kind of run rate based on the reported numbers. But perhaps the Bloomberg numbers represented an entire year's worth of financial results? In other words, Uber's $470 million operating loss could be for the 2014 year. The problem with looking at it that way is that it means Uber's revenue for all of 2014 was only $415 million. That's a pretty small number for a company with Uber's valuation - it was $18 billion at the end of 2014, and is over $40 billion approaching $50 billion now. It also suggests that the company will fall short of the $2 billion net revenue run rate that earlier reports expected it to attain this year, even at a reported 300% growth rate. Uber has not responded to requests from Business Insider. We'll update this story if we hear back.