What Exactly Is Uber’s ‘Core Platform Contribution Margin’?


It’s a timeworn tradition for technology companies to resort to an array of jargon and technical terms to describe their operations — especially if they’re not making a profit.

There’s WeWork’s “community-adjusted Ebitda,” which strips out expenses like taxes and marketing. Or you may have forgotten about “adjusted consolidated segment operating income,” also known as “Acsoi” (pronounced ACK-soy), which Groupon briefly used in the run-up to its initial public offering. (To critics, such measures sometimes equate to “revenue without all the bad stuff.”)

[Uber is losing $1.8 billion a year, its I.P.O. filing reveals.]

Uber is no exception, deploying a number of metrics in its newly filed prospectus to describe how well its core business is doing, despite running a $1.8 billion loss last year. If you’re unfamiliar with them, here’s a glossary to help you out.

“The total dollar value, including any applicable taxes, tolls and fees, of ride-sharing and new mobility rides, Uber Eats meal deliveries and amounts paid by shippers for Uber Freight shipments, in each case without any adjustment for consumer discounts and refunds, driver and restaurant earnings, and driver incentives.”

  • It’s the total dollar amount that Uber gets from every ride, meal delivery or freight shipment, before the delivery person gets a cut and other costs are excluded.

  • Uber had $49.8 billion in gross bookings last year, up 45 percent from 2017.

  • But the company warned that its average gross bookings per trip would go down as it expanded lower-priced offerings like Uber Pool, scooters and “auto rickshaws.”

“Core platform consists primarily of ride-sharing and Uber Eats.”

”Core platform adjusted net revenue as a percentage of core platform gross bookings.”

  • It’s basically a measure of revenue. Subtract driver or restaurant pay and incentives from gross bookings to get “core platform net revenue.” Divide that by gross bookings.

  • It’s a number that will fluctuate a lot, depending on the size of Uber’s driver incentives at any given point. The bigger the incentives that the company doles out to persuade drivers to use its platform, the worse that take rate gets.

  • Last year, the company reported a 20 percent take rate for its core business. That breaks down a little bit more: Ride hailing had a 22 percent take rate, while Uber Eats had a 10 percent rate.

“Core platform contribution profit (loss) as a percentage of core platform adjusted net revenue.”

  • Consider it a jargon-laden way of describing Uber’s profit margins from every ride-hailing trip or Uber Eats delivery. Start with core platform net revenue, then strip out costs like marketing and research-and-development costs. Take the resulting number, which is “core platform contribution profit (loss)” and divide it by core platform net revenue.

  • The company said it had a 9 percent core platform contribution margin last year, compared with 0 percent in 2017.

“The number of unique consumers who completed a ride-sharing or new mobility ride or received an Uber Eats meal on our platform at least once in a given month, averaged over each month in the quarter.”

  • It’s the number of individual users who either book a ride (via a car, a scooter or an electric bike) or order a meal through the Uber app at least once a month. It’s equivalent to the “monthly active user” metric used by social media companies like Facebook.

  • Uber reported 91 million M.A.P.C.s as of Dec. 31, up 34 percent from 2017.



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