New Delhi: Cab-hailing firm Uber will re-invest profits in its products and technology, emerging markets like India and to scale up its Uber Eats and JUMP businesses globally, its chief executive Dara Khosrowshahi said.
In an email to employees, Khosrowshahi said the company’s core business has continued to perform very well and the number of trips on the platform grew 43%, while bookings grew 55% to $11.3 billion compared to last year.
Uber’s net revenue grew 67% to $2.5 billion, while it cut losses to half compared to a year ago, he said. “We are deliberately reinvesting our profits. Even with these impressive results, we’re not going to let up on the gas. We expect to reinvest our profits back into our products and tech, emerging markets like the Middle East and India, as well as big bets like scaling Eats and JUMP globally," Khosrowshahi added.
Besides, the company said it would hold a secondary stock sale for employees and existing investors. “...a new third-party tender offer led by Coatue, TPG, and Altimeter Capital will launch next week. Eligible employees will be able to sell shares to these investors at $40 per share, which implies a valuation of approximately $62 billion," he said.
The improvement of the company’s financial performance comes after months of controversies, including allegations of sexual harassment and lawsuits from drivers and employees.
Khosrowshahi, who took over the reins of Uber in August last year replacing founder and former CEO Travis Kalanick, has been focussing on turning around the company and has taken multiple steps in that direction.
In India, the company is locked in an intense battle for market leadership with homegrown player Ola. Interestingly, Uber and Ola have Japanese conglomerate SoftBank as a common investor.
Khosrowshahi has said the company is committed to investing further in the Indian market but is also keeping a sharp eye on “eventual profitability" as the US-based cab aggregator ramps up operations in the country.
India is already among the top three markets (besides the US and Latin America) for Uber. The company has been pumping in substantial funds to fuel its growth in India.
In 2015, Uber announced an investment of $1 billion in the country to expand its services. It has also set up a response and support centre in Hyderabad with an investment of $50 million.