Uber posts major quarterly losses as Waymo lawsuit heats up

29 Nov 2017

Uber pick-up location in Penang, Malaysia. Image: TY Lim/Shutterstock

A tumultuous time for Uber as it is scrutinised from all angles.

Uber posted a net loss of $1.46bn in the third quarter of 2017, an increase from $1.06bn in the previous quarter, according to a Reuters source.

It added that quarterly net revenue rose 14pc to $2bn and gross bookings increased 11.5pc to 49.7bn on a sequential basis.

As Uber is not a publicly listed company, it is not required to report its financial results.

Softbank deal is underway

According to the Financial Times, documents detailing Uber’s financial situation also laid out the formal launch of the deal led by SoftBank to invest between $7bn and $10bn into the firm. It had been delayed by some disagreements but the process should be concluded by early January.

Investors in the consortium include SoftBank and Dragoneer as well as new investors Tencent and Sequoia. General Atlantic and DST dropped out of the consortium, with many saying the risks associated with the company were too big a gamble for investors.

A spokesperson for SoftBank told Bloomberg: “SoftBank and Dragoneer have received indications from Benchmark, Menlo Ventures and other early investors of their intent to sell shares in the tender offer.

“Any sales by these shareholders will be pursuant to the same terms and conditions as will be offered to all other eligible holders that participate in the tender offer.”

It has not been a smooth year for Uber, with major changes in management, company culture call-outs and a concealed hack affecting 57m users doing some serious damage to the firm’s reputation.

Uber v Waymo

The case taken by rival Waymo against Uber is also intensifying, with Reuters reporting that the latter withheld important evidence.

A hearing yesterday (28 November) concentrated on a letter from former Uber security analyst Richard Jacobs’ lawyer, which Uber neglected to show Waymo as both companies prepared their respective cases. The letter surfaced last week when US district judge William Alsup was informed of it by the US Department of Justice.

In the letter, Jacobs mentioned an organisation called Marketplace Analytics, which “exists expressly for the purpose for acquiring trade secrets, code base and competitive intelligence”. Jacobs said he had ethical questions about the organisation, adding that its strategy allegedly included using ephemeral messaging apps, laptops and wireless internet devices that could not be traceable.

Some Uber employees allegedly also used separate servers from the rest of the business, and invented attorney-client privileges to keep communications under wraps, according to Jacobs.

An Uber spokesperson said that none of Jacobs’ testimony “changes the merits of the case” as he said on the stand that he was unaware of the theft or plans to steal Waymo insider information.

A new date for the trial has not been set but the hearing continues, adding one more to the host of headaches for the Uber team.

Uber pick-up location in Penang, Malaysia. Image: TY Lim/Shutterstock

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects