Uber Shares Drop Below Opening Price on Its IPO-and Stay There

Uber Shares Drop Below Opening Price on Its IPO-and Stay There

Sources briefed on Uber's IPO told The New York Times that prospective investors showed huge interest near the bottom range.

Rajesh Raut, a former cook who became an Uber driver, said his earnings increased when Uber had first launched but have now become meagre, resulting in him defaulting on vehicle loans. Uber operates in a number of verticals besides ride-hailing, including food delivery and freight, all of which are highly competitive and fragmented markets. "We believe Uber is off to a choppy trade on the heels of the Lyft train wreck out of the gates and general investor nervousness on the USA and China [trade war], [and investors' worries about risk]", said Daniel Ives, managing director of equity research at Wedbush Securities.

Adding to investor worries about Uber's listing is the lackluster performance of Lyft, its biggest rival in North America.

Worries about the Lyft IPO and its quickly descending stock price pushed Uber to price its initial offering at the low end of its announced scale. Uber drivers know this, and they're pissed: Earlier this week, drivers around the world engaged in a 24-hour strike to protest Uber's IPO, as well as the fact that the company classifies them as "independent contractors" rather than actual employees.

Uber Technologies Inc's conservative initial public offering could not keep its shares from sinking in their trading debut on Friday, fuelling debate on Wall Street over whether the outcome of the most anticipated listing since Facebook Inc would weigh on other Silicon Valley unicorns.

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Investors say they're hesitant to buy Uber's stock out of the box because of what happened with Lyft, and want to see it settle before buying significant amounts of shares, said Dan Ives, managing director of equity research at Wedbush Securities.

Both Uber and Lyft have never reported a profit, and the former has warned that it may never do so.

Visit Business Insider South Africa for more stories. The company also has its growing UberEats business to bolster revenue.

Khosrowshahi said in the interview Friday that while profitability was a priority for the company, public market investors should be judging Uber by a different metric once it starts reporting quarterly earnings. Its monthly active users, including those of UberEats, rose about 34 percent to 91 million during the year. Uber's revenue a year ago surged 42% to $11.3 billion while its cars completed 5.2 billion trips around the world either giving rides to 91 million passengers or delivering food.

Ride-hailing giant Uber failed to take off like fellow tech peers when it started trading on the New York Stock Exchange.

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