Uber’s Rebound CEO Romances the Financial Community

Like a new boyfriend promising not to hurt them like the last one did, Uber CEO Dara Khosrowshahi gave investment bankers a Valentine’s Day speech on Wednesday that included everything but roses.

Yes, things got weird with that other guy, but I’m making everything better, he seemed to be saying. I can even be a good provider, once I get these self-driving cars and developing markets going.

Khosrowshahi confirmed what much of the world has been saying about the company, which he took over in August after a string of scandals knocked founder Travis Kalanick out of the top job and reshaped Uber’s board.

“We have a long way to go, but we have to re-earn our consumer and driver trust,” Khosrowshahi told the Goldman Sachs Technology & Internet Conference, according to CNBC. Uber had been battling charges of sexual harassmentspying, a data-breach coverupand Kalanick just being kind of a jerk.

“It looked messy and it was messy,” he said. Consumers’ view of the company has been “appropriately negative,” Khosrowshahi said.

That’s done more than make the new CEO feel bad. Uber’s ride-hailing market share fell from 82% to 70% in the fourth quarter of last year, which was Khosrowshahi’s first at the helm.

But in the same quarter, the nine-year-old startup also trimmed its ongoing losses, according to reports about the selected financial details the privately held company shared on a conference call with investors on Tuesday, February 13. Uber lost $1.1 billion in the fourth quarter, down from the $1.46 billion it shed in the last quarter of 2016. Revenue grew 65%.

The company even grew while it was suffering all those embarrassments: Gross revenue for the full year rose 85% to $37 billion.

In fact, Uber could make a profit if it stopped trying to break into less-developed markets outside the US and working on self-driving cars, Khosrowshahi said — but it won’t. Uber will keep investing in Asia, and driverless cars are the only way to eventually make rides cost $1 per mile, he said. They cost about $2.50 per mile today.

The autonomous car effort got a shot in the arm last week when the company settled a lawsuit by rival Waymo after four days in court. Uber made the $245 million deal to put the battle behind it, Khosrowshahi said, according to TechCrunch. “It was a very, very significant distraction for the teams that were working on our autonomous technology.”

The new CEO’s mea culpa for Uber’s sketchy past is a likely prelude to an initial public offering, which he has indicated might take place next year. Big investors, including SoftBank, which bought about 15% of Uber in late December at a discount, will eventually need to earn a return on Silicon Valley’s most valuable startup.

— Stephen Lawson is a freelance writer based in San Francisco. Follow him on Twitter @sdlawsonmedia.

Leave a comment

Your email address will not be published. Required fields are marked *