Uber posted $708 million in losses this quarter, and its head of finance just resigned.

Uber, Which Is Still Shedding a Fortune Each Quarter, Just Lost Another Top Executive

Uber, Which Is Still Shedding a Fortune Each Quarter, Just Lost Another Top Executive

Moneybox
A blog about business and economics.
June 1 2017 1:47 PM

Uber, Which Is Still Shedding a Fortune Each Quarter, Just Lost Another Top Executive

Uber-Reportedly-Loses-Over-1-Billion-In-First-Half-Of-2016
Resignations, financial losses, and court cases, oh my!

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Another day, another nugget of bad news for Uber. The ride-hailing company’s latest speed bump is named Gautam Gupta, its head of finance, who will be leaving Uber in July for an undisclosed startup venture in San Francisco, the Wall Street Journal first reported Wednesday. Gupta’s departure comes amid better—but still far-from-stellar—financial numbers for the company, which reported $708 million in losses during the first quarter of fiscal year 2017.

The timing of Gupta’s departure is awkward: The 37-year-old financial officer, who had been with the company since 2013, was likely to have been the frontman shepherding Uber through its eventual IPO, a step some analysts predict could come as soon as next year. Prabir Adarkar, the company’s head of strategic finance, will inherit Gupta’s responsibilities until a replacement is named, Recode reported Wednesday.

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When it comes to Uber employees diving for the exits, Gupta is in plentiful company. The San Francisco–based outfit has hemorrhaged more than a dozen executives and top managers since January, the Journal reported. That exodus includes the company’s former president, head of mapping, vice president of product, and its top communications executive, who left amid the fallout of ugly revelations about Uber’s hard-driving and misogynistic workplace culture. Amit Singhal, Uber’s vice president of engineering who joined the company in 2015, left in disgrace after failing to disclose that he’d been under investigation for sexual harassment at his previous place of employment, Google. Then, on Monday, five-year Uber veteran Josh Mohrer, general manager of the company’s New York operations, quit to glom onto Tusk Ventures, Recode reported. The ride-hailing company forced out embattled self-driving car engineer Anthony Levandowski the next day, the latest development in its courtroom turf fight with Alphabet, Google’s holding company, from which Levandowski allegedly stole proprietary technology to gift to Uber. Engineers in its autonomous vehicle division are reportedly growing restless as the escalating lawsuit with Google threatens their jobs; some are actively seeking out new employment.

Now the company is scrambling to fill its thinning ranks. Uber has been beating the bushes ever since March, when its CEO, Travis Kalanick, admitted he was looking to bring on “leadership help” after a video surfaced that showed him verbally accosting a company driver. Although Uber has been reluctant to let on too much, the search has so far courted executives at household names like Walmart and Disney, the Journal reports.

Gupta’s departure also highlights Uber’s improved but still troubling losses. Compared with past quarters, $708 million is relatively paltry. The company reported $991 million in losses in the fourth quarter of 2016 alone. And as Reeves Wiedeman noted in New York magazine on Monday, it lost a staggering $2 billion, at least, in 2015, plus a further $2.8 billion in total last year against a reported $6.5 billion in sales. But thanks to its impressive revenues, Uber still remains a startup among startups. The company raked in $3.4 billion during the quarter that ended March 31, ballooning 18 percent from the end of last year. Its $15 billion in equity and debt funding and $7.2 billion cash on hand put it about on par with where it was last year, per the Journal. And tipping the scales at a mean $69 billion valuation, Uber still steamrolls the competition.

“These results demonstrate that our business remains healthy and resilient as we focus on improving our culture, management and relationship with drivers,” an Uber spokesman said in a statement to the New York Times on Wednesday. “The narrowing of our losses in the first quarter puts us on a good trajectory towards profitability.”

But Uber’s PR woes have thrown it on the defensive. It’s beating back new challenges to its ride-hailing supremacy from its top rival in the U.S., Lyft, and nervously eyeing rising international counterparts like the Beijing-based Didi Chuxing. And the company still hasn’t figured out how to shore up a business model that’s incurred massive losses over the past two years, which may spook potential Wall Street investors should its march toward an IPO continue.

Although reports of Uber’s demise are still greatly exaggerated, New York’s Wiedeman wondered on Monday if the company’s vision—“solving First World problems via app”—is starting to become exhausted. Is the tech titan destined to end up like a latter-day MySpace, a ride-hailing Ozymandias remembered only as “a company that created a market but was foiled by its own missteps and overtaken by savvier competition”? With each day inaugurating a new top-level resignation, PR nightmare, or legal hurdle, maybe we’ll know tomorrow.