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


Source

more recommended stories

  • Epstein had foreign passport to protect him from ‘hijackers’: lawyers

    Jeffrey Epstein, the financier recently charged.

  • Elon Musk’s sister runs passionflix video streaming for romance book movies

    Elon Musk may be the most.

  • The best competing Prime Day 2019 sales — Walmart, Target, eBay, & more

    After four years running, Amazon’s retail.

  • How to set up a custom voicemail greeting on a Galaxy S10

    One of the first things you.

  • I always wanted to be a millionaire and it was nothing like I expected

    Hansson at work. via Basecamp Facebook.

  • Apple AirPod Earbuds Deal: Save $14 to $20 on Amazon Prime Day 2019

    Truly wireless earbuds like Apple’s AirPods.

  • APPLY NOW: Insider Inc. is hiring editorial and video fellows and more

    Insider Inc. has a number of.

  • Video shows men in an over-crowded facility yelling “no shower”

    A video taken and posted on.

  • Sharp and McCann show the future of British boxing is fun and flashy

    02 ARENA, LONDON — Red hot.

  • Jeffrey Epstein launched PR campaign after 2008 sex abuse allegations

    Jeffrey Epstein launched a PR campaign.

  • Prime Day 2019 KitchenAid Stand Mixer deals — sale predictions

    There are some things that never.

  • The best vacuum deals we expect to see during Prime Day 2019

    No matter how diligently you clean.

  • Asylum seeker describes baby’s death from poor medical care in ICE custody

    WASHINGTON (AP) — A Guatemalan mother.

  • A new holding center for migrant children opened in rural Texas

    CARRIZO SPRINGS, Texas (AP) — A.

  • Video seems to show Trump embrace staffer who says he forcibly kissed

    President Donald Trump’s attorneys were accused.

  • How to back up photos from an iPhone with iCloud storage

    If you’re someone who loves taking.

  • Famous people who have flown on Jeffrey Epstein’s private plane

    The financier Jeffrey Epstein, the convicted.

  • 9 questions you should ask flight attendants next time you fly

    Getting on a plane is a.

  • DOJ to swap interpreters with videos at immigration hearings

    The Department of Justice is planning.

  • Federal court ruled against bikini baristas at Washington coffee bars

    Women serving coffee at the Hillbilly.

  • Greece election: Conservative party beats left-wing prime minister

    In his concession speech, Mr Tsipras.

  • Photos of US Navy guided missile destroyer USS Jason Dunham

    During the final days of June,.

  • No-deal Brexit: Boris Johnson to be hit by dozens of new Tory rebels

    LONDON — Dozens more Conservative MPs.

  • Turkey is last major Islamic state not to stand up for China’s Muslims

    In recent months, a wave of.

  • PHOTOS: Sophie Turner’s wedding dress with husband Joe Jonas

    Sophie Turner and Joe Jonas had.

  • The winners and losers of the opening days of NBA free agency

    The NBA offseason has been fast.

  • European stocks are jumping as traders bet on loose Fed policy, while US markets break for the Fourth of July

    Ritzau Scanpix Denmark/Reuters US markets were.

  • Megan Rapinoe shuts down critics: ‘I think I’m extremely American’

    Megan Rapinoe has been no stranger.

  • Steve Irwin and son fed the same crocodile 15 years apart

    Steve Irwin’s 15-year-old son Bob is.

  • Serena Williams will wait before giving Meghan Markle parenting advice

    Serena Williams says she will wait.

  • Stocks are dropping on trade-war jitters after Trump threatens another $4 billion in tariffs on EU goods

    Assoicated Press/Alex Brandon US stocks slid.

  • I went to Times Square to see why tourists love it

    Growing up on Long Island, I.