I guess what I'm getting at is that a company valued at 69 billion dollars going out of business in less than 2 years should be a surprise to everyone.
Uber could be valued at a gazillion $, but if it can't make payroll in 90 days, it's got a problem that would be tough to fix, given the apparent lack of a profitable business model.
revenue $6.5 billion
losses excluding China $2.8 bn
$7 billion of cash on hand, along with an untapped $2.3 billion credit facility (bloomberg)
So they are not going bust tomorrow but whether they can build a real business from that is quite questionable.
Revenue is growing but losses are growing too, so revenue is not growing fast enough.
7 billions of cash means Uber will be broke in less than two years depending how much faster losses are growing compared to revenue.
Investors might become hesitant until they know where the lawsuit with google is going.
My interpretation is that, unless Uber finds a way to reverse steam and become profitable they are still around today but are on the way out and might be gone tomorrow.
UberEats for example is completely dying a death in London (this may be different for other markets). Speaking to a few restaurant chain owners they get virtually no orders through and the experience is terrible, because drivers get lost and the food gets cold. They then blame the restaurant and leave loads of bad reviews everywhere.
I genuinely think Uber has very limited network effects. The driver fleet can drive for other companies at the same time, the user will just use the app that is cheapest/works the best/has the best service. I don't see enormous stickiness there, and the other services they offer don't work well IMO.
nb. why on earth is ubereats a seperate app, for example? It should be in the same app.
Ever heard of bubbles ? Well they inflate until they burst in a poof where a few trillions disappear.
Remember the dot com bubble bursting at the beginning of the 2000's ? Expect something similar in a not so distant future as the bubble cycle repeats itself.
So yes a 69 billion dollars market valuation for a company does not mean anything other than investors made a bet this company would somehow pay them back their money plus extra at some point.
The answer might be yes and I'd go with yes, but if they're for some reason on what they see as a death spiral, they could return some investor money and call it quits.
60+ billions valuation for a company losing over 2 billions a year or one third of their total revenue, seems like a big pile of horse manure.