Uber is Raising $600 Million at a $62 Billion Valuation

Uber Technologies Inc., home to the most popular ride-hailing app Uber, is raising $600M in a secondary investment round at a valuation of $62 billion.

In its quarterly report for Q1 2018, the company reported $2.5 billion in revenues and a net loss of $601 million. Below the list, the EBIDTA stands at a negative $304 million as the company’s loss streak continues. Its still an improvement, relatively, as it reported a higher loss in the same quarter last year.

Investors have agreed to buy up equity in Uber, investment firms including Altimeter, Coatue Management, and TPG have decided to purchase $400 million and $600 million shares which will incur a $62 billion value on Uber.

Active Investments

The company expects the losses to continue. CEO Dara Khosrowshahi believes that Uber needs to actively invest in other areas such as food delivery, electric bikes, and self-driving vehicles to grow and turn profitable. The losses might be short term and are prone to get worse, as the company is continuously spending money in its recently acquired subsidiaries including JUMP, Eats, and other ventures such as flying taxis.

The former is a bike-sharing service, and Uber Eats is meant to be a global food-delivery chain. The CEO said,

We are off to a terrific start in 2018, given the size of the opportunity ahead of us and our goal of making Uber a true mobility platform, we plan to reinvest any over-performance even more aggressively this year, both in our core business as well as in big bets like Uber Eats globally.

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Reportedly, Uber is also shifting its focus to Middle Eastern countries such as Pakistan and India where it faces its compelling rival, Careem, and is looking to provide more services.

70% Net Growth in Revenue

Its financial reports suggest that its drivers, in total, are getting a much smaller chunk of revenue generated per ride, the companies net revenue – which comes after subtracting expenses and wages to the drivers – stood at $2.6 million at 70% yearly growth.

On the other hand, the gross revenue – which includes the share of the drivers – was $11.3 billion, which is a 55% growth as compared to last year.

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