- General
- May 13, 2019
- 3 minutes read
Uber Slides After IPO
image: Uber After finally debuting on the public markets, Uber’s share price has seen a decline of about 13% from…
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| image: Uber |
After finally debuting on the public markets, Uber’s share price has seen a decline of about 13% from its $45 debut price, sliding down to below $39 (as of writing) during trading on Monday. Uber raised $8.1 billion via the sale of 180 million shares at $45 a pop. The decline likely indicates some skepticism concerning Uber’s ability to execute on growth areas like food and package delivery and its ambitions of driverless vehicles.
Uber is already the leader in the ride-hailing market but that’s one with quite intense competition, with Uber having to keep prices low to avoid being undercut by competitors. Uber hasn’t turned a profit, with at least $1 billion in losses in the first quarter of this year. The company also recorded losses of $1.8 billion last year.
Just like Uber, its competitor Lyft which went public earlier this year has also declined on the stock market. The company’s shares hit a record low of less than $50 (as of writing) during trading on Monday. This is 30% less than its debut price of $72 per share. Lyft posted $1.14 billion in losses in its first quarter as a public company, but that was mostly due to a near $900 million charge for stock-based compensation for the quarter. Excluding that, Lyft recorded a $211 million loss on $776 million revenue for the quarter.
