[crispytx]

$120 Billion valuation on $2.6 billion in annual revenue? Seems like a pretty steep price to me!

Note: I believe that $2.6B figure that I found does not include the amount of ride revenue that goes to the drivers, so maybe that's why the valuation is so high. If you add back in the drivers share of the revenue, maybe the valuation isn't that crazy.

[ndirish1842]

> $120 Billion valuation on $2.6 billion in annual revenue?

That number is quarterly revenue (and as you say does not include the share the driver takes)

[arcticbull]

Pricing them at 12X net revenue out the gate is pretty aggressive to say the least. Especially when their margins were -60% back in 2016 and in late 2018, and if anything they've gotten worse with the recent price drops. [1, 2] It's not fair to compare them to the negative margins enjoyed by other tech companies as most software companies are zero-marginal-cost businesses. It's far from clear to me that people would pay the double price per ride it would take to break even.

A few years ago, if I'm not mistaken, they even switched to counting the entire value of an Uber Pool/Express Pool ride as net revenue (something they don't do with their core product offerings) muddying the water. Does anyone know if that's changed? [3]

$120B would price them at the same net revenue multiple as Square ($2.21B/yr @ 25B market cap) while Square has much, much better margins (0% vs -60%) - and is itself widely regarded as not being a cheap buy.

[1] https://techcrunch.com/2017/04/14/uber-shares-growing-financ...

[2] http://nymag.com/intelligencer/2018/12/will-uber-survive-the...

[3] https://www.bloomberg.com/news/articles/2017-04-14/embattled...