Uber’s CEO sent an email to employees addressing its disastrous IPO, drawing on Amazon’s and Facebook’s rough starts (UBER)

Uber IPO NYSE CEO Dara dara khosrowshahiGetty/Spencer Platt

  • Uber CEO Dara Khosrowshahi sent an email to employees on Monday, addressing the ride-hailing giant’s brutal stock-market debut.
  • He said that while the market has so far punished Uber’s newly minted shares, employees should be mindful that its early post-initial-public-offering trading won’t necessarily give way to long-term issues.
  • Khosrowshahi pointed to Facebook, which in 2012 saw the biggest first-month decline of any large US-listed IPO in history, and Amazon.
  • Watch Uber trade live.

Uber CEO Dara Khosrowshahi addressed his company’s abysmal initial public offering in an email to employees on Monday.

The chief executive sought to reassure employees that while Uber’s IPO did not yield the first-day results the company had hoped for, they should keep in mind that several high-profile technology companies sputtered in their debuts only to surge in later years.

He pointed to Facebook and Amazon.

“Remember that the Facebook and Amazon post-IPO trading was incredibly difficult for those companies,”  Khosrowshahi wrote in the email to employees that was posted on Twitter by New York Times reporter Mike Isaac. “And look at how they have delivered since.”

When asked about the email, an Uber representative pointed Markets Insider to Isaac’s tweet.

Read more: ‘Our stock did not trade as well as we had hoped’: Read the reassuring email Uber’s CEO sent employees following its disastrous IPO

Uber shares plunged 12.4% Monday, to close at $36.43, after sinking nearly 8% on Friday. The second ride-hailing company to hit the US market priced its IPO at $45 a share on Thursday and saw a $42 debut on Friday morning.

To put its dismal showing another way, Uber’s first day of trading turned out the largest one-day dollar loss of a US-listed IPO, according to analysis from Jay Ritter, a professor at the University of Florida who has long specialized in IPO market research.

Consider that performance against Amazon and Facebook, which debuted in May 1997 and May 2012, respectively.

In split-adjusted terms, Amazon opened at $2.44 a share and tumbled to $1.96 by the close its first day of trading. The stock moved sideways until July 1 of that year, taking nearly two months to finally reclaim its opening price. (Amazon debuted on the Nasdaq at $16 a share). 

Facebook’s debut was more fraught. The social network in 2012 saw the biggest first-month drop of any large US IPO in history, according to Dealogic. The shares plunged 21% and failed to recapture their opening price for about 16 months.

Since the close of trading on their respective IPO days, Facebook has gained 377% and Amazon is up 93,542%.

Khosrowshahi’s plea to employees was not unlike advice from analysts and money managers who urge investors not to consider companies’ early stock-market movements as indicative of the long-term story.

“There are many versions of our future that are highly profitable and valuable, and there are of course some that are less so,” Khosrowshahi wrote. “During times of negative market sentiment, the pessimistic voices get louder, and the optimistic voices pull back.”

He added: “Obviously our stock did not trade as well as we had hoped post-IPO.”

Khosrowshahi is leading the company through its debut at a difficult moment for the stock market.

Global markets have fallen under pressure in recent weeks amid the ongoing trade war between the US and China. Stocks fell on Monday after China said it would hike tariffs on US goods in a retaliatory measure. US markets remain near all-time highs despite the recent volatility.

Now read more Uber coverage from Markets Insider and Business Insider:

Stalled out: Why the rush of IPOs from big, unprofitable companies like Uber and Lyft could throw the entire market off track

Uber is tanking after logging the biggest first-day dollar loss in US IPO history

Meet Austin Geidt, the Uber exec whose life is the stuff of Silicon Valley legend, who joined the company as an intern in 2010, got sober at age 20, and just rang the company’s IPO bell

Uber shares.Markets Insider


more recommended stories

  • Renault, Fiat Chrysler reportedly in deal talks for a major tie-up

    Fiat Chrysler is in advanced talks.

  • Trump, Iran near brink of a war that would likely devastate both sides

    Tensions between the US and Iran.

  • This convertible clutch is the most stylish way to organize essentials

    Insider Pickswrites about products and services.

  • I toured a $58.5M condo for sale in a Billionaires’ Row tower in NYC

    New York City is no stranger.

  • What science says parents should do to set their kids up for success

    When kids witness mild to moderate.

  • What is a late term abortion and why do women have them?

    Democratic presidential candidate Pete Buttigieg shut.

  • Tesla cuts prices of Model S, Model X as stock slumps

    Faced with a slumping stock price.

  • Michael Cohen implicates Sekulow, Giuliani, Trump Jr. in House testimony

    Michael Cohen has long been considered.

  • ‘Game of Thrones’ Isaac Hempstead Wright defends finale, Bran’s story line

    “Game of Thrones” star Isaac Hempstead.

  • Trump speaks out against parts of extreme anti-abortion laws

    President Donald Trump has distanced himself.

  • Alexandria Ocasio-Cortez Wonder Woman comic cover upsets DC Comics

    She’s a 29 year-old congresswoman who.

  • Google suspended some business with Huawei after Trump blacklist

    NEW YORK (Reuters) – Alphabet Inc’s.

  • OnePlus 6T review: Why it’s better than expensive flagship phones

    The OnePlus 6T runs on the.

  • Tony Robbins recorded telling woman she was ‘lying’ about abuse

    According to an investigation from BuzzFeed.

  • Adidas is releasing another pair of ‘Game of Thrones’ sneakers

    Following up on their hit UltraBOOST.

  • How to make people like you immediately

    According to the “mere-exposure effect,” people.

  • Fifth grader who told classmates to stop doing the Nazi salute was pulled out of class

    An elementary school in Tennessee will.

  • Scientists develop light-activated bio-glue that could seal fatal wounds in seconds

    A new ‘biological glue’ developed by.

  • Joshua Jones speaks out after helping disarm STEM School Highlands Ranch shooter

    One of three students who helped.

  • Helicopter crashes into New York’s Hudson River

    A helicopter has crashed into the.

  • Apple’s Supreme Court loss could harm its App Store business

    Thanks to the Supreme Court, Apple.

  • How to allow pop-ups in Google Chrome from all sites or specific ones

    Pop-ups can be the scourge of.

  • Watch Winnie the Pooh meet the royal family in a new video

    Disney is celebrating the birth of.

  • Times celebrities got accused of lip syncing

    One of the most legendary instances.

  • Uber CEO Dara Khosrowshahi is part of a family of impressive techies

    Led by CEO Dara Khosrowshahi, ride-sharing.

  • All the food Miss USA typically eats in a day

    On May 2, Cheslie Kryst was.

  • Where do billionaires live? Top 15 cities for billionaires worldwide

    Billionaires are increasingly becoming concentrated in.

  • House Democrats overplayed their hand to get the full Mueller report

    The war between the White House.

  • How to use Google Maps offline

    Where would we be without Google.

  • Anna Delvey: Fake heiress sentenced to prison for up to 12 years

    Socialite scammer Anna Delvey was sentenced.

  • Here’s everything the US military is sending to take on Iran

    The US military is sending a.

  • Advertising and Media Insider newsletter May 8

    The Amazon office in New York..