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August 6, 2015

Uber says ‘shock, horror’ as leaked docs show epic losses

Revenues are on the up, but taxi app firm losing money as legal battles mount.

By Jimmy Nicholls

Uber appears to be losing millions of dollars a quarter as it pours investment into its global operations in a bid to grow revenues.

Documents obtained by the news site Gawker show the company lost more than $100m (£64m) in the second quarter of 2014, with the losses more than doubling from the previous quarter.

The taxi app firm did not deny the truthful of the reports, but sought to diminish their importance, saying in a statement: "Shock, horror, Uber makes a loss. This is hardly news, and old news at that.

"It’s a case of business 101: you raise money, you invest money, you grow (hopefully), you make a profit and that generates a return for investors."

Despite rarely revealing the details of its finances, Uber is now rumoured to be worth some $50bn, and at the end of last year was worth $40bn.

Whilst the Gawker images show losses are increasing it also revealed that revenues are climbing, with the company booking more than $100m in revenues through the first half of 2014, the same amount it made throughout the entirety of 2013.

What the documents do not detail is how much money Uber is skimming off the amount its drivers’ claim for their work, which has not been publicly revealed.

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The apparent leak comes at a time when Uber is facing increased regulatory pressure, with a US district judge poised to decide on Thursday whether a class action suit against the company can go ahead.

Taking place in California, at present the case involves three drivers who want to be classified as staff rather than contractors, but if class action is granted Uber could face 160,000 drivers in the West Coast state.

Around the world Uber has faced numerous other legal battles over drivers’ rights and the safety of the service, whilst also generating controversy in London for its use of surge pricing during recent Tube strikes, a measure that hikes fares to get more drivers on the road.

The taxi app firm has yet to respond to CBR’s further requests for comment.

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