How has Uber been able to sustain itself for so long without having a single profitable year?

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How has Uber been able to sustain itself for so long without having a single profitable year?

In: Economics
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Investors keep giving Uber money.

So long as you have people willing to give you money (in the form of loans or investments for ownership) you can keep running at a loss for as long as the money holds out. Investors believe that Uber will _become_ profitable in the future, so they are willing to keep investing to help Uber get there.

When investors no longer feel that Uber has a profitable future, then it will need to get profitable _really fast_ or it will collapse.

Profit is different than revenue.

Revenue is the money being made at each transaction – typically a big number in total.

Profit is what you have left over after you’ve paid everyone and covered other operating expenses. So everyone at Uber’s board can be making millions while the company is still non-profitable.

People give it money with the hope that by aggressively expanding today with discounts and such they’ll have a monopoly on ride hailing across the world and then be really, really profitable.