Uber, the ride-hailing company, plans to pour its profits into expanding its products and investing in technology in emerging markets.
BGR, citing an email penned by Uber CEO Dara Khosrowshahi, reported the company will reinvest profits in emerging markets, including India, so it can beef up Uber Eats and JUMP. Khosrowshahi said that Uber's main business continues to do very well, with the number of trips increasing 43 percent while bookings are up 55 percent from the prior year. Net revenue increased 67 percent to $2.5 billion, and its losses were cut in half compared to last year. As a result, Uber is looking to put money back into the business.
“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 wrote in the email. “…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 USD 40 per share, which implies a valuation of approximately USD 62 billion.”
In February, during a presentation in India, the Uber CEO dismissed rumors about a potential merger with ridesharing service Ola, saying instead that he plans to invest more in the company’s India business, which has been suffering recently from losses.
“My focus is on our quality of operations and our teams; that’s why I’m here. I’m here to meet with our teams, ministers, etc., to understand the market, and, at this point, I’m not really focused on M&A,” Khosrowshahi said at the time. He also noted that the ride-hailing company will focus on improving its losses in India. “I think we’re going to be quite aggressive in India as far as investment goes. One of the great structural advantages that we have at Uber is that we have many profit pools. Those profit pools in the mature markets in the U.S. and Europe allow us to actually lean into some of the developing markets,” he said.