Investigations for deceiving authorities, Price Transparency violations, bribery, and sexual reports of sexual harassment. Investors pushed out kalanick inhe ceo and founder, and 2017, Dara Khosrowshahi was brought in to fix it. He has brought in new management, worked to rebuild trust and reputation. Still, it hasnt been an entirely smooth ride. A big flashy i. P. O. Sparked excitement, but ultimately, investors were not impressed. Now the job is to prove them wrong. Joining me on bloomberg studio 1. 0 at uber headquarters in downtown san francisco, uber c. E. O. Dara khosrowshahi. It has been a long two years. Two years ago, it was announced that you would be replacing former c. E. O. Travis kalanick. And even you have admitted you were the unlikely dark horse, even accidental choice. So two years later, did they make the right choice, and did you make the right choice . Dara [laughs] i know i made the right choice, and i hope they made the right choice. Im confident that they did. You can never prepare yourself for a job like this, and uber is a onceinageneration company. But it has been a great two years for us. We have resolved all of the governance conflicts that the company had. There were many legal issues the at the company was involved with, as well. We got softbank in as a partner, and you want softbank to be behind you and a big partner and big investor, and we have a great investor base. We have taken the company public, and the company revenue, gross bookings, have grown 75 since i joined. We now have a path to profitability, i believe. So while weve had bumps on the road, and every adventure has bumps on the road, i like where we are, and i especially the position were in now for the next few years. Emily there have been bumps on the road, and despite all the negative stories, uber, lyft, Ridesharing Companies have been transformational. The big question for you is, can uber be as transformational over the next decade as it has over the last decade . Dara i think so. I mean, really what uber has done is brought transportation and opportunity, at this point, to what we believe is a small segment of the population. Listen, we have over four million driver partners all over the world, which is a huge number, and it is unparalleled, but we want uber to be available to everybody, and were going into the next step of introducing other transportation choices to uber. Weve always gone with pool, but for example, were testing buses in cairo now to even bring the price of uber down to the next level, one dollar, 1. 50, et c. Emily can the uber be so transformational and stop losing money . I mean, the prices sound attractive, but can you create a Good Business where the rides are 1, 1. 50 . Yes. You look at our rideshare dara yes. You look at our rideshare business, it covered our overhead less about 100 million. So the rideshare business itself is earning quite profitably, and we believe the profits of the rideshare business not only are going to grow top line but bottom line, as well. And then there are other businesses eats, autonomous, trait, etc. These are extraordinarily opportunities that were funding, but i do believe well prove to our investors that we can take, on a serial basis, big parts of our business, turn them profitable, and use those parts of the business to Fund Investments in other areas. Emily there are execution issues. You just had your biggest quarterly loss ever, the stock is been trading below its ipo price more often than not, investors seem to love shorting it, you have got hiring freezes on various teams, you fired some or at least some of your top hires have left, so how confident are you that uber can be profitable . Dara i am very confident. We reported a 5 billion loss from an accounting perspective, and from an accounting perspective, thats a lot, and i live in the real world. In the real world, our ebitda loss, were lower than q1 and were on a good path in terms of ebitda losses, as well. But youre right. None of this will be easy and. All of this will take excellent execution from all of our teams, marketing, etc. , and we are going to be demanding our employees to be doing more with less and to execute incredibly effectively in order for us to grow the top line and bottom line, as well. Emily so is pricing the main lever that you pull to profitability, or are there other drivers . Dara scale. Scale. Its getting big when youve got over a billion rides per quarter , and you have got trips growing at 35 on a year on year basis. We think we can use technology to be more efficient. For example, instead of your having to email a Call Center Agent or call a Call Center Agent if you have issues, you can just do it in an app. These are Technology Innovations that allow customers to have a better experience than i do the same time, they bring down costs experience, and at the same time, they bring down costs. So the combination of growing top line over 30 , Technology Innovation to delight the customer and take costs down at the same time, and then good oldfashioned efficiency, making sure corporate costs dont grow as fast as our revenue is a formula to profitability. Emily ubers market cap is 50 some billion dollars. There was talk it could be 120 billion. Your compensation is tied to that. Can you still get there . Dara i believe we can. Short term, right now, short term is nothing that we can do about the stock price. Theres an old saying that short term the stock market is a voting machine, long term its a weighing machine. I am very confident that this team can execute and create a very heavy company that can never be denied. Emily so, when . How long does it take dara i think its in the next couple of quarters are going to show a road map to investors, but it will take years. This is not a shortterm game. But i believe we can demonstrate progress. For example, i talked about our net Revenue Growth accelerating the second half of the year. Usually, Companies Like ours, you dont see Revenue Growth accelerate. I talked about our Revenue Growth accelerating in the second half of the year beyond 30 , and weve always been consistent in saying that the bottom line, ebitda, will continue to develop in a positive matter. Emily were in the midst of escalating trade tensions. How exposed is uber if the economy falters . Dara our company is much more tied in to the consumer, and the consumer, right now in the u. S. , is very strong. We are a very global company. The majority of our transactions actually are outside of the u. S. , so we really look at Global Growth, to the extent that Global Growth slows down. That could be a negative for us. Although, if Global Growth slows down, we are going to have more driver partners also wanting to come on the platform, because we expose very, very flexible labor opportunities. So i do think that the growth of the company is such that well we are going to be relatively resistant to any macro slowdown, and we are certainly not seeing any slowdown with the u. S. Consumer as of yet. Emily whats plan b, if were in a fullblown trade war . Dara yep. Emily we have heard of investing in vietnam or brazil . Dara were an assetlight company, so we dont have to buy cars, etc. We will obviously be wary and make sure that our driver partners can source vehicles in an economic way. Many of them source vehicles through secondhand. Theyll source used vehicles, so to speak. So, i dont think this trade war we certainly havent felt it in very small parts of the business, where were importing bikes, for example, theres some additional expense there, but its not having a material effect on the company, and were confident about growth over the next few quarters, trade war or no trade war. Emily youve asked people to think about uber like the amazon of transportation. Amazon was an online bookstore before they did all this other stuff. What if now is not the right time to do this . What if now is the right time to focus on the core . Dara we have been in the ridesharing business for a long time, as well. And that business is developing and its profitability is developing. Were the top player in every market in which we compete and , and generally were either Holding Share or taking share in those market places, so we have a core business that provides the framework for us to build multibillion dollar opportunities, and i think it will be criminal if we dont take advantage of that. You are seeing more and more apps and companies that are building ecosystems, super apps, so to speak, especially in the east, for example, in china. Emily right. You have grab trying to do a tencent. , is that the way to think about the future . Dara the super apps are winning , and we can be the super app of transportation, so to speak, that allows us to acquire customers at much cheaper rates than our competitors and allows us to keep customers because we have a deeper relationship with them, and we think if you can acquire customers and keep them longer, that is just a winning formula. Emily uber eats is what, 20 to 30 of the business . Dara yes and growing quickly. We are the Largest Global player out there, and we continue, in the category of food, we believe can be as large or even larger than the ridesharing category, so we love that business, and we continue to invest in it. Emily there are so many competitors that do exactly what you do in this market and other markets. What if youre just subsidizing our meals, and you dont win the market share, and this is just a giant hungry money pit . Dara so early on, i think people could have accused the rides business of the same. It turns out that the rides business, you see it with ourselves and lyft, etc. , it is moving towards a path of profitability. As you build these businesses when the potential is so big, there is subsidization that goes into the marketplace to create efficiencies. You need to get eaters, you need to get couriers, and you need to sign up restaurants , and there is investment early on. Is there competition . Absolutely. But there will always be competition in big categories. We have the advantage, because we have hundreds of millions of consumers on the ride side that we can essentially introduce to our brand, and let them know that theres more to uber than just riding, but theres eating and other areas that you can enjoy. Emily some of the businesses we the business as it seems hear less about, like scooters, we havent heard a lot about scooters lately. Whats the likelihood you pull out of some of these businesses . Dara every business is going to have to execute and carry its weight, so to speak. Were a big believer in micromobility. Its in the early days. We believe in electric bikes. We believe in electric scooters. And, increasingly, i think the mayors of the large cities, all around the world, are going to want to be interested in ways of moving people around that dont pollute, that dont create traffic, and we believe micromobility can be part of the solution. Emily would you curtail International Expansion in the short term . Dara every part of our business has to fight for money, and if theyre not deserving money, theyre not going to get it. So believe me, internally, theres lots of creative destruction, theres lots of competition, and if one part of our business isnt carrying its own weight, we will pull back. Listen, we pulled back out of china, and we turned what was a 2 billion investment in cash into what can be a 10plus billion stake in didi, which is a very big ridesharing business in china, as well. So, we are in the end, were looking to build a business. We want to build it the right way. We want to build a business in alignment with our partner society, etc. But if somethings not working, we believe weve demonstrated the discipline to make the right call at the right time. Every management has their faults. Ive got my faults. But the fact is they built a Great Company, and now theyve handed it to me, and ive got to take that Great Company and make it even greater. Emily when we last visited, there was a driver protest outside. Democratic president ial candidate Pete Buttigieg was out there with them. He said gig is another word for jobs. That means youre a worker and ought to be protected as a worker. There is support for legislation that would force Companies Like uber, that rely on contract drivers and delivery people, to make them fulltime. Why shouldnt they be fulltime . Dara because they dont want to be fulltime. Emily well, some do. Dara some do. More than half of our drivers in the u. S. , for example, drive less than 10 hours with us a week. Now listen, right now california has a historic opportunity. We are at the table. We are having these discussions , and we want to the get to a solution. Were offering 21 minimum an hour when youre driving on a platform. Were offering benefits, and were offering a voice as far as how youre going to be treated going forward. 21 an hour compares to 12 an hour minimum wage. This is not this is real money, and these are real rides, and you get the flexibility that every single uber driver or courier wants, because they can come into the market when they want to or out. This is an historic opportunity to, i think, revolutionize the gig economy, and i dont think gig is a type of work. To say that theres only one way to work, and Everyone Needs to be fulltime, etc. , i dont think thats correct, because it takes away flexibility, and flexibility is absolutely something that all of our drivers prize. Emily and can you give them flexibility and give drivers and riders safety at the same time . Dara if the Legislature Works in the interest of making something happen, absolutely. And you know that were making very significant investments in safety, as far as the safety center, tracking your ride, et c. And we believe we are the leader in safety as far as transportation goes in the world , and we will continue to invest aggressively there. Emily were going to talk a little bit more about the future, but before we go there, i want to talk more about the past. The uber you took over had some toxic cultural issues. Illegal payoffs to police officers, violence, sexual assaults, even murder on the platform, angry taxi drivers, and a Management Team that turned a blind eye to much of it in the name of growth at all costs, socalled brilliant jerks, if you will. And yet there are some people who say that leadership was bolder, brasher, bigger thinking, maybe better. How do you respond to that . Dara i think time will tell, and i think that you need different kinds of management for different times in the development of a company. Listen, the management every management has their faults. Ive got my faults and every Management Team at the time has their faults, but the fact is they built a Great Company, and theyve handed it to me, and ive got to take that Great Company and make it even greater. I think im up to the job. And while they made their mistakes, the fact is they built a great brand that had weaknesses and has incredible strengths. Its my job to take it to the next level. Emily anthony levandowski, the guy who ran the trucking business that uber bought, was just charged with stealing technology from google, stealing trade secrets. What do you make of those charges . Dara i wasnt here when we brought anthony on board, but what i do know is that we went to incredible depths to make sure that any information that anthony might have acquired from google, and it sure looked like he did, didnt make it over to our company. That was our responsibility, and i think we were incredibly diligent in making sure that we were not guilty of anything that could be nefarious one way or the other. We think when you build, you have got to build the right way. Anthony is an incredibly talented person. It didnt work out, but i think we did the right thing. Emily the person who was here, and who spearheaded that acquisition, which which might cost uber 100 million, is still and it costs some accountability , is still on the board, travis kalanick. I asked you this on i. P. O. Day. Do you question travis position on the board . Dara i think that i am going to live in the here and now. Travis has an incredible amount of historical knowledge about the company. He is incredibly bright, as are our other board members, and i use him at the board hes a very strong adviser, and his background on the company is incredibly useful, and i think he is supportive. Ultimately, now, we are a public company, and the shareholders are going to get to pick their own board, and that governance process will take care of itself going forward. Emily so you talk to him often . Dara i talk to him usually during board meetings and once in a while offline, absolutely. Emily but, hes on the board for now . Dara hes on the board for now , and he is going to be on the board tomorrow. Fast forward 10 to 15 years from now, autonomous is going to be a huge part of how people get around. It will be cheaper, it will be safer. Why not invest now to make that happen . Emily lets talk about the future, then. To those who say that uber is a ridesharing and food delivery company, what is ubers next big idea . Dara i think that the ideas that we have right now in this building are plenty big ideas. Weve got ridesharing, weve got food delivery, we have micromobility, weve got autonomous. Weve got freight revolutionizing how truckers move around and how shippers ship product all over the world. Weve got elevate, as well. We have an enormous number of big ideas, and now its execution time. Emily so where do you think most of the technological innovation happening at uber . Dara it is happening all over. What is unique about our business is that we are a combination of the digital and the physical and the two coming together in unique ways. So we have very interesting, for example, Machine Learning algorithms that are looking at supply and demand, live supply and demand in a city, what riders are looking for, and where theyre located, and then giving our drivers guidelines as to where to go in order to meet that demand. This matching of supply and demand in a dynamic way, and the pricing that we have, is something thats unique. We continue to innovate there, and then we innovate in in very, very different spots, such as elevate, as to how we can bring together different modes of transportation and tie them together, walking, driving, to a helicopter, for example, now, to j. F. K. Emily youre in charge of not just visualizing the future of transportation but trying to get there and create that future. When you look into the future, what does the future of transportation look like . Dara we think we can bring it together. I believe we can have that singular app where, every morning when you wake up, any way that you want to get from point a to point b, we can give you the information that is relevant to you with live pricing, inventory, etc. We now have mass transit in the app, so were going to tell you mass transit you can take, subway, you can take a bus, you can take an uber, a pool, and if it is a long enough trip, you can take an elevate, as well. We are uniquely positioned to have all that information together, and we can do the same thing for transportation, the we can do the same thing for local commerce, and with eats restaurants, it is only the beginning, and we can do the same thing for logistics. No other company in the world is positioned to solve local transportation, local commerce, and logistics as well, and i think were in a spearhead position to do so. Emily wheres uber in five years, 10 years . Dara with so much innovation and so much change going on, that i have a hard time predicting, for you, whats going to happen in the next year, but i do think what you will see us is increasingly going into multimodal modes of transportation. We are going to open up our marketplace to thirdparty transportation providers, because were not going to do it all ourselves. I think were going to be much deeper partners with the cities in which we operate. We want to bring demand to public transit, as well. We are going to have a much better enterprise solution, as well, both in terms of businesses and health, and what you will see with eats is moving beyond the category of just restaurants, although thats a very, very big category, into other categories of commerce, as well. Its going to be a pretty exciting time, not just for the next year or five years, but for the next 10 years here. And its really up to the the teams here. Its my job to bring together the talent who can help me envision that 10year future. Emily does the future of profitability, does profitability depend on selfdriving car technology, or the advent of selfdriving car technology, or are those things two things separate . Dara i think we can get to profitability before selfdriving, for example, becomes the majority of trips, but i think that if you look forward, and if you want to bring safety on the road, increase it, because the number of people who die in accidents in the u. S. And abroad theres just no reason to have that many people hurt. Most accidents are caused by human error, and we can avoid that. We can avoid that with computers and technologies, and at the same time, we can take the cost more mile down pretty significantly. So, fast forward 10 to 15 years from now, autonomous will be a huge part of how people get around. It will be cheaper. It will be safer. Why not invest now to make that happen . Emily but can you get profitability without selfdriving technology . Dara 15 years from now, no. Any Transportation Company that doesnt have selfdriving as part of its strategy, and thats why we have a. T. G. We can build out our selfdriving technology specifically to serve our network, and thats a huge advantage that we have, but any company 15 years from now in the that is in the transportation space that doesnt have strong selfdriving strategy, whether they build it themselves or they work with someone, is not going to be around for long. Emily i know im asking you to think big, big picture now, but in the history of silicon valley, in the uber pantheon, how are we going to look back on today, your twoyear uberversary . Dara you will say every Great Company has to go through tough times. You know you look at facebook, you look at amazon, even five years after their i. P. O, all of them went through periods where companies are tested. This is the moment where the mettle of uber is tested, and im very confident that were going to come out of this stronger than we ever have been before. Emily Dara Khosrowshahi, thank you so much for joining us here on studio 1. 0. Dara thank you very much. Appreciate it. Alix finding the edge. An energy focus Asset Management company where there is opportunity and risk. Forget gold buy pork bellies. Pork prices are up so much in china, wearing the meat around your neck is a new sign of wealth. Fracking ban, carbon tax, no nuclear. Democratic president ial hopefuls outlined their energy plans the winners and losers. Alix i am alix steel. Welcome to commodities edge, 30 minutes focused on the companies, the physical assets, and the trading behind the hottest commodities with the smartest vo