Uber stock has risen after a tough start
After a subpar start to what was one of the most anticipated IPOs ever, Uber (UBER) breached its IPO price of $45 on June 5 before ending the day at $45. The stock has surged 24.7% since its second day of trading on May 13. Uber currently has a market cap of $75.7 billion.
Most of these returns came after it reported its first-ever earnings—which weren’t blockbuster, by the way. The ride-hailing giant posted a net loss of $1 billion, while its growth slowed to 19.9% year-over-year.
Uber’s path to profitability remains clouded
Uber stock fell in the first two sessions of trading as investors worried about its giant losses and remained concerned about whether the company could ever reach profitability given the stiff competition from local rivals across the world. The company’s losses in the first quarter were driven by a surge in promotions to woo customers. Uber also spends a good chunk of its revenue on its drivers.
The surge in Uber stock came not on the back of its earnings but after a couple of positive analyst reports. The stock jumped 5.3% on June 5 alone. Uber wants to become a dominant force in the transportation space. Its food delivery division, Uber Eats, along with Uber Freight, saw robust growth in the previous quarter.