Shares of ride-hailing giants Uber and Lyft have dropped to new lows on Tuesday, with both companies finishing on their lowest close since launching. Uber followed ride-hailing rival Lyft with their IPO launch back in May, but both companies have seen a negative reaction to its shares which have slumped in price.
Uber shares debuted at $45, but yesterday hit an all time low of $30.70 (down 5.7% from the previous day), falling below its previous record of $32.57 on 30 August. It could have been worse for Uber as shares hit an intraday all-time low of $30.67, but rallied back to $30.70 before close. Lyft endured a similar bumpy ride on its share price, finishing the day on $45.42 (down 7.2% on the previous day). Like it’s rival Uber, the stock dropped lower during the day to $45.40, but rallied back up $0.02 before the close. Lyft Inc went public before Uber at a share price of $72 on 29 March. Both IPOs took place against a backdrop of renewed concerns on Wall Street over global growth due to the trade tensions with China. Fast forward to September and the 30% drop in share price since launch means the companies are now facing ever increasing skepticism from investors. Since launching their IPO, both Uber and Lyft have reported significant second quarter losses. Uber reported a loss of $5.24billion and Lyft reported a $644.2million loss respectively. To add further headaches to both companies, a new proposed driver workers’ rights law in California could be seen as a major threat to Uber and Lyft’s business models should it make its way through the state Senate.
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