Uber, the ride-sharing Program and Delivery company, has warned that it might not achieve profitability as it releases details of its plan to float.
Uber said that its latest yearly earnings rose to $11.2bn and losses narrowed to $3bn. It expects operating expenses to”increase significantly”.
The company didn’t disclose how it will price its shares when it opens them to the stock market.
However, it’s been reported that they could be valued at between $48 and $55 each, giving the 10-year old enterprise with a net worth of around $100bn, which makes it the largest initial public offering this year.
Uber is also expected to grow about $10bn throughout the flotation.
Chief Executive Dara Khosrowshahi has over the past 18 months enhanced Uber’s board and governance oversight, assembled a new management team and taken steps make sure the company culture rewards teamwork and reduce employee turnover.
The business was struggling to recuperate from a variety of scandals, including a toxic work environment which was exposed by former Uber engineer Susan Fowler.
It has also faced numerous legal issues, such as whether the men and women working for the company are classed as employees and are therefore eligible for vacation pay, paid rest breaks and the minimum wage.
The company is just one of the so-called ‘unicorns’ – personal investor-backed companies worth $1bn or more – which are planning initial public offerings this year.
But, there are concerns about investor appetite for these businesses, which have brought high valuations in the private market but are yet to make a profit.
Uber’s smaller competitor, Lyft, was the first of this group to float but after listing at the end of March, its share price has dropped by 15.2 per cent to $61.
Meanwhile, Pinterest, the digital image cataloguing service, has priced its shares at between $15 and $17 each, valuing the company as much as $11.3bn. That’s below its $12bn evaluation in its latest private financing round in 2017.
Pinterest’s listing, which is expected next week, may attract up to $1.2bn in funding to the company.