Uber’s Head of Finance Exits as Revenue Rises, Losses NarrowBy
Uber Technologies Inc.’s revenue increased to $3.4 billion in the first quarter and losses narrowed, even as hundreds of thousands of people deleted the company’s ride-hailing app from their phones.
The company also said its head of finance, Gautam Gupta, is leaving. Gupta, who has long served as de facto chief financial officer even though he never earned the title, helped oversee investor calls and run the finance team. But there had been persistent questions from employees and investors about whether he had the experience to lead Uber through an eventual initial public offering. Uber said it’s now searching for a true CFO who can woo Wall Street.
Uber has faced a series of public-relations crises this year. The hashtag #DeleteUber trended on Twitter as users removed the application from their phones in protest of the company’s ties to U.S. President Donald Trump. Chief Executive Officer Travis Kalanick left Trump’s business advisory board in response. Then, after Bloomberg published a video of Kalanick arguing with an Uber driver, the embattled CEO said he would seek leadership help. The company is searching for a chief operating officer and fending off a lawsuit from Alphabet Inc. over driverless-car technology.
The San Francisco-based startup’s first-quarter loss was $708 million, shrinking from the $991 million loss in the previous period. The company’s ability to boost revenue and narrow losses even amid the customer protests reflects the global nature of its business -- most of the app deletions took place in the U.S. The first-quarter financial details and Gupta’s exit were reported earlier Wednesday by the Wall Street Journal.
Uber, valued at $69 billion, has raised more than $15 billion in funding in its seven-year history. Uber said it has $7.2 billion of cash on hand. In the fourth quarter, the company generated $6.9 billion in gross bookings and $2.9 billion in net revenue. For all of 2016, Uber’s global losses, excluding its China business, totaled $2.8 billion. The company lost at least another $1 billion in China last year.
In a note announcing his departure to employees, Gupta said he’s leaving to join another San Francisco startup as chief operating officer, “to take on a new challenge.”
Kalanick praised Gupta in an emailed statement. “Gautam is a world-class financial talent,” the CEO wrote. “Over the last four years, he has been indispensible in helping build Uber from an idea into the business it is today.”
Uber reports net revenue using generally accepted accounting principles, but this calculation has drawbacks: For its carpool service and in cities where it uses upfront pricing, the company records the entire the fare as revenue instead of just the amount Uber keeps from drivers. Uber’s non-GAAP revenue is significantly lower. In the fourth quarter, Uber generated $1.4 billion in non-GAAP net revenue. Last quarter, non-GAAP revenue grew to $1.5 billion.
Meanwhile, GAAP revenue grew much more quickly as more people carpool. The amount increased to $3.4 billion in the first quarter from $2.9 billion in the previous quarter.