Uber shares surge by almost 40 per cent after torrid week
Uber’s stock price has surged by nearly 40 per cent today, after its chief executive said the company would have billions in cash at the end of the year even in the worst case scenarios.
Dara Khosrowshahi told analysts today that the ride-sharing app would have $4bn in cash at the end of 2020, and an additional $2bn revolver, even in its worst estimates.
This is despite passenger volumes falling by up to 70 per cent in some US cities during the coronavirus outbreak.
In Hong Kong, where Covid-19 hit earlier than Europe and the US, trips fell by 45 per cent but are now 30 per cent off their peak.
He added that the company had also seen growth in some areas of its business, such as Uber Eats.
Uber’s stock price was up 37 per cent to $20.31 as of 6.30pm GMT.
“The most important thing to know is that we’re well positioned to weather this crisis and emerge even stronger,” he said on the call,” Khosrowshahi said.
“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 businesses likely to rebound after a shock like this.”
The turnaround comes after a disastrous week for the Silicon Valley giant.
Investors fleed from Uber shares in fear of how increasing global quarantine and social distancing measures would affect the ride-sharing app’s revenues.
Its stock price fell to $14.82 at the end of Wednesday’s trading, which was 68 per cent down from its all-time high of $47.08.
It represented a 50 per cent fall from just a month earlier.