When Dara Khosrowshahia year and a half ago, he said his goal was to take the company public by 2019. Now he's delivering on that pledge.
In one of thethis year, the company opened at $42 a share in its stock market debut Friday morning, below its preopen price of $45. Throughout its first day of trading, it didn't get much better for Uber. By midday, its share price got as high as $44.74, but then closed at $41.57, down 7.6%.
At its closing price, Uber raised $8.1 billion and was valued at $76.5 billion. The numbers, though eye-popping, are significantly lower than earlier expectations of aand roughly the same as Uber's $76 billion valuation as a private company. The preopen price was at the low end of the $44 to $50 range the company forecast in a last month.
A host of issues may have contributed to the conservative pricing. Lyft, Uber's ride-hailing competitor, has had a rough time since debuting on the stock market earlier this year. On Tuesday,in its first quarterly report as a public company, which didn't help.
"We view Uber's conservative pricing as a smart and prudent strategy coming out of the box as it clearly learned from its 'little brother' Lyft, and the experience it has gone through over the past month," analysts at Wedbush Securities, a financial services firm, said in a statement.
Uber's pending debut has also whipped up protest in the ride-hailing world, drawing unwanted attention to practices in the business. Drivers CNN. The settlements were disclosed in a filing with the US Securities and Exchange Commission on Thursday.on Wednesday to demand better pay and working conditions, an event that was widely covered. Uber recently settled arbitration demands with about 60,000 US drivers who wanted to be classified as employees, rather than independent contractors, according to
Uber and Lyft offer the same core service but highlight different aspects of their business. To date, Uber has showcased itself as a global company that offers more than ride-hailing, including food delivery and (in the future). Lyft is much smaller and concentrates on transportation.
Founded in 2009, Uber started as Ubercab, a black car service that let passengers hire a town car with the push of a button on their smartphones. A few years later, the company shortened its name and in 2012 pushed into the ride-hailing service we all know today. Since then it's gotten into all types of services, including, on-demand scooters and bicycles, carpooling and freight trucking.
The company has also experienced heaps of turmoil over the years. Uber's co-founder and former CEO Travis Kalanick was considered the quintessential tech bro whose "burn the village" approach -- his words, not ours -- helped turn the startup into the behemoth it is today. But, as at many companies, Uber's culture reflected the personality of the person at the top. It was aggressive and win-at-all-costs.
In 2017, everything came crumbling down for Uber. Scandal after scandal cost the company customers, drivers and its reputation.
The company lost more than 200,000 angry passengers to a #DeleteUber campaign. It was outed by former Uber engineer Susan Fowler, who wrote a bombshell blog detailing a chaotic corporate culture that OK'd sexual harassment. Lawsuits poured in, executives were fired, at least five separate criminal investigations were initiated. Along the way, Kalanick was forced to step aside.
Khosrowshahiin September 2017, vowing to fix Uber's moral compass. Hiring his own leadership team, instilling new cultural norms and working to clean up Uber's previous messes, many of his employees say, he's drastically turned around the company culture.
Khosrowshahi has also worked to fortify Uber's business by sealing a $9.3 billion investment deal led by Japanese internet giant Softbank and pushing to settle Waymo's high-stakes lawsuit over alleged stolen trade secrets on self-driving cars.
Despite the market's slump on Friday, a number of early Uber employees and investors will get very rich from this IPO. That includes First Round Capital, which made an early investment of $510,000 that's now valued at $2.5 billion, and Lowercase Ventures, which invested $300,000 that's now valued at $1.1 billion, according to The Wall Street Journal. Uber's co-founders' net worth also skyrocketed, according to Forbes. Kalanick's net worth is now estimated at $5.4 billion and Garrett Camp's is at $4.1 billion.
As Uber becomes a publicly traded company, it still has serious issues to iron out. Most importantly: the fact that it's never been profitable and may never be. The company said in its S-1 filing that it garnered $11.3 billion in revenue in 2018 on $49.8 billion in bookings. Even so, it lost $1.8 billion in 2018.
"We expect our operating expenses to increase significantly in the foreseeable future," Uber said in the filing. "And we may not achieve profitability."
Originally published May 10, 5 a.m. PT.
Update, 9:05 a.m. PT: Adds Uber's opening share price. Update, 11:02 a.m. PT: Adds Uber's midday share price. Update, 1:06 p.m. PT: Adds Uber's close of market share price. Update, 2:07 p.m. PT: Adds information on net worth of Uber's co-founders and early investors.