“While we will of course continue to invest
in growth and the power of our platform,
especially in some of our newer, high-potential
businesses like Eats, we will continue to be
thoughtful stewards of capital, make tough
decisions where necessary, and make any dollar
investment count,” Khosrowshahi said.
Both Uber and Lyft are facing potentially higher
costs for paying drivers. In September, California
passed a law requiring ride-hailing drivers to
be classified as employees, which could entitle
them to minimum wage, benefits and workers
compensation. In response, Uber and Lyft
proposed a ballot initiative aiming to exempt
their companies from the new law.
“We think that there’s a better answer out there,”
Khosrowshahi said. California’s new law was
figured into Uber’s future profitability prediction,
and Uber is already operating within similar laws
in states such as Massachusetts, New Jersey and
Connecticut, he said.
California represents 9% of Uber’s global rides
and eats bookings, Khosrowshahi said.
In New York City, where regulations forced
ride-hailing companies to increase prices, it
“definitely hurt volumes in the outer boroughs
where people need transportation the most,”
Khosrowshahi said. But despite raising prices
in some markets, frequency of use of Uber’s
services is increasing, he said.
Some analysts are concerned that a deluge of
Uber stock will flood the market later this week
when a lockup period expires, allowing major
shareholders, including company executives and
investors, to sell their shares.