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The Policy That Will Make the Uber/Lyft IPO Pay Off

Congestion pricing is gaining ground in New York City and Los Angeles. That could help turn around ride-hailing’s losses.
Will Uber and Lyft flop or fly on the stock market?
Will Uber and Lyft flop or fly on the stock market?Jeff Chiu/AP

As Uber and Lyft race towards initial public offerings in 2019, the ride-hailing arch-rivals will face a stark reality: Neither company is profitable.

Uber’s IPO is expected to be the largest ever for a tech company—currently valued at $70 billion, the firm’s market cap is projected to swell to $120 billion upon going public. But while its revenues have ticked up on an annual basis, the company continues to shed money. In the third quarter of 2018, Uber lost $1.07 billion. It lost $4.5 billion in 2017, the year Travis Kalanick departed as CEO after months of negative press on a range of company practices. The smaller, U.S.-focused Lyft is also reportedly burning through cash. And with growth slowing at both companies, some market analysts warn that an early stock bonanza could fizzle in short order.