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   Technology StocksUber Technologies and Lyft Inc. IPOs


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From: Ron9/17/2022 1:45:36 PM
   of 238
 
Troubling Details About the Big Uber Hack
wired.com

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From: Glenn Petersen10/12/2022 5:48:07 AM
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Uber, Doordash plunge after Labor Department proposes change to gig worker classification

Published Tue, Oct 11 202210:37 AM EDT
Updated 4 Hours Ago
Lauren Feiner @lauren_feiner

Key Points
  • The Biden Labor Department released a proposal Tuesday that could make it possible for gig workers to be reclassified as employees, rather than contractors.
  • The proposed rule sent stocks of gig companies like DoorDash, Lyft and Uber down.
  • It comes after a court reinstated a Trump-era rule Biden's Labor Department tried to block that would have made it easier to classify gig workers as contractors.
The Biden Labor Department released a proposal Tuesday that could pave the way for regulators and courts to reclassify gig workers as employees rather than independent contractors.

The proposed rule, if adopted, could raise costs for companies like Lyft, Uber, Instacart and DoorDash that rely on contract workers to pick up shifts on their own schedules. Shares of Lyft fell 12% on Tuesday, while Uber dropped 10.4% and DoorDash shed 6%.

The companies have argued that flexible schedules are attractive to workers, pointing to surveys showing the popularity of the model, which they say is made possible by the use of independent contractor status. Some labor experts and activists have disagreed, however, saying the companies use the contractor model to reduce their own costs while denying workers important protections such as health-care benefits, overtime pay and the ability to organize into unions.

In 2020, a California law went into effect requiring many companies to reclassify contract workers as employees, but later that year, voters approved a proposition that exempted app-based ride-hailing and delivery companies from the law.

Last year, the Biden administration rescinded a rule created under Trump's Labor Department that would have made it easier for gig companies to classify workers as independent contractors instead of employees. But after a legal challenge, a court reinstated the Trump-era rule.

Biden's Labor Department said in its notice in the Federal Register that it had considered waiting longer to see how the Trump-era rule played out. But it decided to move ahead with the proposed regulation instead because it believes keeping the earlier rule in place "would have a confusing and disruptive effect on workers and businesses alike due to its departure from case law describing and applying the multifactor economic reality test as a totality-of-the-circumstances test."

The proposed rule would allow the determination of whether to classify a worker as a contractor or employee to rely on a more holistic assessment, including whether the work is an "integral" part of the employer's business. The goal is to protect workers from being classified improperly while providing consistency for businesses that wish to employ independent contractors, the agency wrote.

The new proposed rule will still need to make its way through the formal regulatory process, including allowing time for the public to submit comments, before it is adopted.

Uber's head of federal affairs, CR Wooters, said in a statement that the proposed rule "takes a measured approach, essentially returning us to the Obama era, during which our industry grew exponentially. In a time of deep economic uncertainty, it's crucial that the Biden administration continues to hear from the more than 50 million people who have found an earning opportunity with companies like ours."

In a blog post Tuesday, Lyft wrote that there "is no immediate or direct impact on the Lyft business at this time," noting the 45-day public comment period. It added that the rule "Does not reclassify Lyft drivers as employees," and also doesn't force it to change its business model. Lyft said the rule simply reverts the standard to that used under the Obama administration, which previously applied to its company "and did not result in reclassification of drivers."

cnbc.com

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From: Glenn Petersen11/1/2022 7:58:43 AM
   of 238
 
Uber reports another loss but beats on revenue and the stock is up

Published Tue, Nov 1 20226:59 AM EDT
Updated 1 Min Ago
CNBC.com

Key Points
  • Uber reported third-quarter earnings that beat analysts' estimates for revenue Tuesday.
  • The company suffered a net loss of $1.2 billion for the quarter, $512 million of which was attributed to revaluations of Uber's equity investments, according to a company release. In this article
Uber reported a third-quarter loss Tuesday but beat analysts' estimates for revenue and showed a surge in bookings. Shares were up about 9% in premarket trading.

Here's how the company did:
  • Loss per share: 61 cents
  • Revenue: $8.34 billion vs. $8.12 billion expected by analysts, according to Refinitiv.
Uber reported a net loss of $1.2 billion for the third quarter, $512 million of which was attributed to revaluations of Uber's equity investments, according to a company release.

In a prepared statement, CEO Dara Khosrowshahi said Uber delivered a "strong quarter" and benefitted from booming travel, easing lockdowns and shifts in consumer spending. He said October is tracking to be the company's "best month ever for both Mobility and total company Gross bookings." However, he cautioned that after the last few years, the company has learned not to take anything for granted.

"With continued rigor around costs, discipline on headcount, and a balanced capital allocation approach, all supported by our leading technical and operating capabilities, we are well positioned to deliver expanding profitability over the coming quarters," Khosrowshahi said.

The company reported a record adjusted EBITDA of $516 million, beating guidance of $440 million to $470 million and ahead of analyst estimates of $457.7 million according to StreetAccount. Gross bookings for the quarter came in at $29.1 billion, up 26% year over year.

For the fourth quarter of 2022, Uber said it expects gross bookings to grow between 23% and 27% year over year on a constant currency basis, and an adjusted EBITDA of $600 million to $630 million.

Here's how Uber's largest business segments performed in the quarter:

Mobility (gross bookings): $13.7 billion, short of analysts' estimates of $13.83 billion according to StreetAccount.

Delivery (gross bookings): $13.7 billion, short of analysts' estimates of $14.01 billion according to StreetAccount.

Uber relied heavily on growth in its Eats delivery business during the pandemic, but its mobility segment surpassed Eats revenue in its first and second quarters as riders began to take more trips. That trend continued during the third quarter, as Uber's mobility segment reported $3.8 billion in revenue while delivery reported $2.8 billion.

Uber's freight business booked $1.75 billion in sales.

The number of monthly active platform consumers climbed to 124 million in the third quarter, up 14% year over year. 1.95 billion trips were completed on the platform during the period, up 19% year over year.

Shares of Uber are down more than 36% so far this year. The stock tumbled more than 10% in October after the Biden Labor Department released a proposal that could pave the way for regulators and courts to reclassify gig workers as employees. The proposed rule could raise costs for companies like Uber, Lyft, Instacart and DoorDash that rely on contract workers to pick up shifts on their own time.

The companies have argued that flexible schedules are attractive to workers, but some labor experts and activists have disagreed, saying the companies use the contractor model to reduce their own costs and deny workers important protections.

Uber has also had to contend with high gas prices and inflation, but CEO Dara Khosrowshahi told CNBC's "TechCheck" in September that its supply side may actually be benefiting from the inflationary environment.

As expenses rise and people are paying more for essentials like groceries, he said they are also signing up to drive for Uber.

"If anything, 72% of drivers in the U.S. are saying that one of the considerations of their signing up to drive on Uber was actually inflation," he said.

Uber will hold its quarterly conference call with investors Tuesday at 8 a.m. ET.

--CNBC's Lauren Feiner contributed to this report.

cnbc.com

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