Peer-to-peer transportation company Uber is expected to go public in 2019. The company has experienced a huge turnaround under CEO Dara Khosrowshahi, expanding its business through sheer customer numbers and the amount of services offered.
While the end of 2018 will be light on significant mergers and IPOs for the U.S. stock market, there is one very big one on the horizon that investors should take note of.
While it’s impending IPO won’t affect your investment portfolio today, it’s still worth familiarizing yourself with the company as you look ahead to 2019.
Uber is More Than Just a Ride Sharing Company
Uber built its business on peer-to-peer ride hailing, allowing its users to book taxi-like services though a smartphone app. These services were provided by drivers in private vehicles, in association with Uber. Since beginning, Uber now offers ridesharing services, food and parcel delivery, bicycle sharing, and premium taxi services.
Uber now has a presence in worldwide markets, with drivers in more than 780 metropolitan areas. Uber’s share of the peer-to-peer transportation industry is a staggering 73%, vastly outperforming its closest competitor, Lyft.
How Far Away is the IPO?
CEO Dara Khosrowshahi said in August of 2017 that an IPO could be made as early as February 2019. This would depend on several factors. Although it generates a significant amount of revenue, the company still runs at a loss as it invests heavily in expansion as well as emerging technologies. Self-driving technology is high on the list of priorities.
Despite the company not yet turning an operating profit, there is still plenty of interest from private investors as well as large automotive multinationals. Toyota Motor Corp. recently invested $500 Million into the company. Toyota will assist with the development of Uber’s autonomous vehicle program and provide Toyota Sienna vehicles which will later be integrated into the company fleet.
Toyotas Investment is Key to the IPO Excitement
While investors know that an IPO is eventually coming, it was Toyota’s investment that created excitement in the market. The $500 Million from the Japanese automaker indicates that Uber is valued at close to $72 Billion.
If the company continues its growth trajectory, and starts to work towards profitability, then their IPO will likely be the largest that the stock market has ever seen for a technology related company.
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