After a disappointing stock market debut last Friday, Uber's shares have steadily continued to fall in day two of trading.
The ride-hailing company's CEO, Dara Khosrowshahi, sent an email to employees Monday morning aiming to address the issue head-on and boost morale, according to CNBC.
"Like all periods of transition, there are ups and downs," Khosrowshahi wrote, according to CNBC. "Obviously our stock did not trade as well as we had hoped post-IPO. Today is another tough day in the market, and I expect the same as it relates to our stock."
Uber's initial public offering opened at $42 a share on Friday morning, which was $3 lower than its preopen price of $45. Throughout that first day of trading, it didn't get much better. By market's close, the company's shares were at $41, down nearly 8%.
On Monday, things got even worse. Trading opened at $38 per share and by midday, Uber's stock was down roughly 20% to $36 a share.
It's unusual for such a well-known tech company, flush with investor funding, to do so poorly with its stock market debut. One of the only other major Silicon Valley companies that could compare is Facebook, which went public in 2012 and closed its first day of trading up just 1% over its preopen price. The social media company's shares plummeted the weeks after its IPO.
In his note to Uber employees, Khosrowshahi references Facebook's rough start and then its rebound as a public company.
"Remember that the Facebook and Amazon post-IPO trading was incredibly difficult for those companies. And look at how they have delivered since," Khosrowshahi wrote. "Our road will be the same. Sentiment does not change overnight, and I expect some tough public market times over the coming months. But we have all the capital we need to demonstrate a path to improved margins and profits."
One of the reasons investors may be uneasy about Uber is the fact that it's never been profitable and may never be. In a filing with the US Securities and Exchange Commission last month, the company wrote, "We expect our operating expenses to increase significantly in the foreseeable future, and we may not achieve profitability."
Uber rival Lyft is having similar problems. Lyft also said it has an issue with becoming profitable and it too is seeing poor stock performance. Lyft went public in March of this year and, despite having a positive first day of trading, its shares have plunged in the weeks since. Lyft's preopen share price was $72 and it closed its first day at $78, but as of Monday, its shares are down roughly 39% to $47.
Khosrowshahi said in his email that he'll discuss the company's IPO further during Uber's all-hands meeting on Tuesday. Despite what the stock market is doing, the CEO said he remains positive.
"During times of negative market sentiment, the pessimistic voices get louder, and the optimistic voices pull back," he wrote. "We will not be able to control timing, but we will be able to control the outcome. We will be judged long-term on our performance, and I welcome that. It's all in our hands."
Uber didn't return request for comment.