Markets

Uber Says It Has the Cash to Maintain Operations Through Coronavirus Crisis

Uber (NYSE: UBER) may be experiencing a 60% to 70% decline in demand in areas where there are clusters of COVID-19, but the company has enough cash to maintain operations, according to management. 

In a conference call with investors, Uber CEO Dara Khosrowshahi said the ride-hailing company is "well positioned to weather this crisis and emerge even stronger. We have ample liquidity. We have a highly variable cost structure, a global footprint, multiple business lines that give us some diversity and case studies for how quickly our business is likely to rebound after a shock like this. All of this gives us confidence."

Khosrowshahi said the company had about $10 billion of unrestricted cash at the end of February. 

A person driving a car. A smart-device displaying directions is on the dash.

IMAGE SOURCE: GETTY IMAGES.

As of Thursday, there were roughly 230,000 confirmed cases of COVID-19 worldwide, and about 9,400 deaths.  In the U.S., the number of cases has swelled to more than 8,700. As more tests are made available in the U.S., the number of cases is expected to surge. 

At the same time that Uber is seeing a decline in demand for its core ridesharing business, its Uber Eats food delivery service is experiencing a surge. "Our Eats business is an important resource right now, especially for restaurants that have been hurt by containment policies." Khosrowshahi said. "Even in Seattle, a community that has been hit really hard, the Eats business is still growing."

The executive also expressed optimism the worst of the coronavirus is over in some places. Khosrowshahi said once things begin moving again Uber will, too.  

Uber stopped short of updating its first-quarter guidance, given the moving nature of the pandemic. But Khosrowshahi did say the company may provide an update later. Uber's comments were enough to send the stock surging in trading Thursday amid a rebound in the stock market.

10 stocks we like better than Uber Technologies
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Uber Technologies wasn't one of them! That's right -- they think these 10 stocks are even better buys.

See the 10 stocks

 

*Stock Advisor returns as of March 18, 2020

 

Donna Fuscaldo has no position in any of the stocks mentioned. The Motley Fool recommends Uber Technologies. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

UBER

Latest Markets Videos

    The Motley Fool

    Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

    Learn More