Uber Technologies Inc has upended the transportation industry in the span of a few years, but the ride-hailing company has been losing a lot of money while doing so.
Uber recorded losses of about US$1.2 billion in the first half of this year, according to a person briefed on the company’s financial data, who spoke on the condition of anonymity.
More than half of those losses, or about US$750 million, accrued in the second quarter, the person said.
Photo: Reuters
An Uber spokesman declined to comment. Bloomberg previously reported on Uber’s financial information.
The numbers underscore the difficulties that Uber and similar firms face when trying to build and expand globally.
As Uber has opened operations in numerous cities around the world, it has needed to spend to recruit drivers, to market its service, and to take on regulators and established taxi companies. The company has also paid for driver and rider incentives in the form of subsidies.
As a result, Uber has been on a fundraising tear. The company, valued at more than US$62 billion by investors, has been raising billions of US dollars every few months.
In June, the company garnered US$3.5 billion from Saudi Arabia’s Public Investment Fund, one of the single largest investments ever in a private technology company.
Much of Uber’s heavy losses in the first half were attributed to the company paying subsidies to attract riders and drivers, especially in China, according to two people with knowledge of the matter.
Uber spent the last two years fighting a war in China against Didi Chuxing (滴滴出行), the incumbent ride-hailing giant in the country. Both companies spent billions of US dollars subsidizing rides in the race to gain market share.
The company posted significant revenue growth in the second quarter of this year, the person said, including a 31 percent jump to more than US$5 billion in second-quarter bookings, a method of accounting that includes the money paid out to Uber drivers.
Net revenue, the amount Uber pulls in after paying out commissions to drivers, was about US$960 million in the first quarter, before jumping to US$1.1 billion in the second quarter, the person said.
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