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nycdataviz t1_j9bo013 wrote

Reply to comment by Neoliberalism2024 in FYI for anyone trying to take an Uber/Lyft from LGA on Sunday by RevolutionaryAd5176

“While Uber has seen tremendous growth over the past decade, the company has yet to make a profit.”

“Throughout its history, on an annual basis, Uber has never made a profit.” As of 2023

One wonders why they continue to struggle to make a profit, despite their operational costs being close to nothing, relative to their drivers, who face ongoing vehicle maintenance and rising fuel costs. Could it be, possibly, that their business model relies on exploitation, monopolization, and manipulation?

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Neoliberalism2024 t1_j9bouei wrote

You can literally look at their finance statements, they made a profit the quarter I referenced.

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nycdataviz t1_j9br3rh wrote

On one specific quarter? Do you even know why they were profitable that ONE specific quarter? If you knew as much as you’re acting you do you wouldn’t have cited this as proof they are profitable 😂

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Neoliberalism2024 t1_j9bsotr wrote

Do you know why they aren’t profitable? It’s because they are investing heavily in Capex, and could be very profitable the second they weren’t chasing growth.

Look at how late in the game Amazon chose to become profitable.

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mikere t1_j9f8y23 wrote

capex isn't expensed on the income statement for SEC reporting purposes, and even if they were, Uber only spent $300 million in capex last year vs a loss from operations of $1.8 billion

The only reason they realized a profit in Q4 2021 is because they sold off multiple businesses. They lost $550 million in Q4 2021 from operations

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Neoliberalism2024 t1_j9f9cxn wrote

What are you talking about? Capex absolutely is deducted from net profits. Are you mixing up net margin or EBITDA from net income?

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mikere t1_j9f9kvq wrote

no capex is not expensed on the income statement for SEC reporting purposes. It might be deducted from the income statement for IRS purposes if they elect bonus depreciation or section 179

The journal entries for capex goes:

Debit PP&E

Credit Cash (or accounts payable)

Nothing gets put on the income statement

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Neoliberalism2024 t1_j9f9qa8 wrote

Capex is deducted through depreciation of the Capex each year.

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mikere t1_j9fasaq wrote

Quote of the year for /r/accounting

up there with grocery stores taking tax deductions from those charity donations at the register

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Neoliberalism2024 t1_j9fl3p1 wrote

If you’re an accountant, yikes…

https://www.investopedia.com/ask/answers/112814/does-capital-expenditure-capex-immediately-affect-income-statements.asp

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mikere t1_j9fo0sq wrote

> Money spent on CAPEX purchases is not immediately reported on an income statement

literally in the second paragraph

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Neoliberalism2024 t1_j9fts0w wrote

Cool now keep reading where they explain how Capex flows through to depreciation and impacts the income statement, like I said three posts ago.

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mikere t1_j9fvcog wrote

Uber’s capex of 300 million last year results in a whopping $30-40m of annual depreciation assuming a 7-10 year average lifespan and straight line method

Is there any quarter in recent history in which Uber had positive operating income excluding depreciation? I think that would answer the question on whether capex/depreciation is the driver in keeping Uber’s net income negative

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