RUSH TRANSCRIPT Get in ░░░░░░░░ the all day market ░░░░░░░░ on opening and closing ░░░░░░░░ weekdays 09 00am to ░░░░░░░░ 00am and 02 00pm ░░░░░░░░ 05 00pm Welcome back ░░░░░░░░ cheddar is opening bell ░░░░░░░░ posted a surprise q ░░░░░░░░ revenue beat with the ░░░░░░░░ company bring in over ░░░░░░░░ 1 billion dollar lows ░░░░░░░░ the last 3 months ░░░░░░░░ gross bookings reached 29 ░░░░░░░░ billion which is a ░░░░░░░░ year over year despite ░░░░░░░░ fuel prices were says ░░░░░░░░ is more drivers and ░░░░░░░░ than before the pandemic ░░░░░░░░ forecasting q 3 operating ░░░░░░░░ above estimates back anyone ░░░░░░░░ demand for its ride ░░░░░░░░ and food delivery services ░░░░░░░░ to discuss his David ░░░░░░░░ CEO of new constructs ░░░░░░░░ want to get your ░░░░░░░░ and your reactions to ░░░░░░░░ 2 results just brought ░░░░░░░░ in and what do ░░░░░░░░ see as the company ░░░░░░░░ kind of main challenge ░░░░░░░░ think probably going to ░░░░░░░░ a challenge I think ░░░░░░░░ there s a nice ░░░░░░░░ pier where things got ░░░░░░░░ you know thank goodness ░░░░░░░░ s not focused on ░░░░░░░░ ebitda anymore they ve ░░░░░░░░ realize that s not ░░░░░░░░ real profit number You ░░░░░░░░ ha moment for but ░░░░░░░░ rating cash flow numbers ░░░░░░░░ something we would trust ░░░░░░░░ the company has burned ░░░░░░░░ billion dollars in free ░░░░░░░░ last for 5 years ░░░░░░░░ so has been public ░░░░░░░░ tremendously on proper business ░░░░░░░░ ve we ve never ░░░░░░░░ seen a prop a ░░░░░░░░ true positive profit margin ░░░░░░░░ I think it s ░░░░░░░░ if they can t ░░░░░░░░ to a real profit ░░░░░░░░ profit margin We won ░░░░░░░░ know for sure until ░░░░░░░░ see the 10 q ░░░░░░░░ I would tell you ░░░░░░░░ least here the valuation ░░░░░░░░ still extremely high even ░░░░░░░░ they are generating profits ░░░░░░░░ m glad you bring ░░░░░░░░ the cash flow because ░░░░░░░░ m going to ask ░░░░░░░░ just in a right ░░░░░░░░ actually because they didn ░░░░░░░░ do cash for a ░░░░░░░░ bit differently and so ░░░░░░░░ get your kind of ░░░░░░░░ station too you know ░░░░░░░░ it has for for ░░░░░░░░ value but they were ░░░░░░░░ flow positive for the ░░░░░░░░ time ever that little ░░░░░░░░ more for me and ░░░░░░░░ you can touch on ░░░░░░░░ the company it you ░░░░░░░░ has a challenge ahead ░░░░░░░░ it in shielding itself ░░░░░░░░ rising fuel prices Yeah ░░░░░░░░ I mean we ve ░░░░░░░░ saying since before the ░░░░░░░░ for uber that this ░░░░░░░░ a broken business model ░░░░░░░░ s it s a ░░░░░░░░ business right I mean ░░░░░░░░ we see the taxes ░░░░░░░░ New York City and ░░░░░░░░ cities also have an ░░░░░░░░ and that was really ░░░░░░░░ s only real advantages ░░░░░░░░ had a nap right ░░░░░░░░ I don t really ░░░░░░░░ that an app is ░░░░░░░░ advantage It and so ░░░░░░░░ these businesses a commodity ░░░░░░░░ as soon as they ░░░░░░░░ prices to a level ░░░░░░░░ they can make money ░░░░░░░░ s going to invite ░░░░░░░░ competition so yeah I ░░░░░░░░ how they can have ░░░░░░░░ measure free cash flow ░░░░░░░░ m sure ignoring stock ░░░░░░░░ it s probably a ░░░░░░░░ number than the adjusted ░░░░░░░░ number that they were ░░░░░░░░ which any investor believes ░░░░░░░░ is foolish and but ░░░░░░░░ though at least say ░░░░░░░░ I don t think ░░░░░░░░ is a long term ░░░░░░░░ flow positive business I ░░░░░░░░ don t think that ░░░░░░░░ food delivery business is ░░░░░░░░ long term cash flow ░░░░░░░░ business And so you ░░░░░░░░ look this is you ░░░░░░░░ this is Wall Street ░░░░░░░░ to to one of ░░░░░░░░ ipo darlings look good ░░░░░░░░ ultimately you know this ░░░░░░░░ one of the stocks ░░░░░░░░ think could could end ░░░░░░░░ going to 0 vigilant ░░░░░░░░ that s an interesting ░░░░░░░░ you bring up over ░░░░░░░░ delivery service us about ░░░░░░░░ a little bit because ░░░░░░░░ from like a list ░░░░░░░░ had diversified revenue streams ░░░░░░░░ the live re service ░░░░░░░░ it up at least ░░░░░░░░ the better part during ░░░░░░░░ pandemic in really was ░░░░░░░░ to offset the tremendous ░░░░░░░░ or certainly the demand ░░░░░░░░ center saw on the ░░░░░░░░ side But now coming ░░░░░░░░ this quarter you that ░░░░░░░░ was mobility that revenue ░░░░░░░░ delivery revenue 2 quarters ░░░░░░░░ a row now What ░░░░░░░░ you think this says ░░░░░░░░ the demand for riders ░░░░░░░░ it was ability to ░░░░░░░░ its revenue stream is ░░░░░░░░ an upside in comparison ░░░░░░░░ a list when they ░░░░░░░░ kind of losing the ░░░░░░░░ on one side getting ░░░░░░░░ the other side Do ░░░░░░░░ see the net neutral ░░░░░░░░ I see them both ░░░░░░░░ negative alicia let news ░░░░░░░░ diversification if it loses ░░░░░░░░ right I mean revenue ░░░░░░░░ itself is not something ░░░░░░░░ s hard to do ░░░░░░░░ right we can all ░░░░░░░░ out and generate revenue ░░░░░░░░ whatever you want to ░░░░░░░░ it especially if we ░░░░░░░░ it at a loss ░░░░░░░░ will pay has plenty ░░░░░░░░ money to you know ░░░░░░░░ we can give them ░░░░░░░░ product below costs right ░░░░░░░░ revenue by itself is ░░░░░░░░ a justification for being ░░░░░░░░ business diversifying from one ░░░░░░░░ losing business into another ░░░░░░░░ s not a good ░░░░░░░░ that s not in ░░░░░░░░ mind Diversification it s ░░░░░░░░ and so I think ░░░░░░░░ is better off because ░░░░░░░░ have not invested in ░░░░░░░░ losing businesses and to ░░░░░░░░ extent they are their ░░░░░░░░ more on the last ░░░░░░░░ delivery so that they ░░░░░░░░ t have to eat ░░░░░░░░ much losses as what ░░░░░░░░ is eating in doordash ░░░░░░░░ I m sorry and ░░░░░░░░ new breeze But you ░░░░░░░░ doordash is in a ░░░░░░░░ business either So yes ░░░░░░░░ I don t see ░░░░░░░░ diversification is actually a ░░░░░░░░ is just another money ░░░░░░░░ businesses that they have ░░░░░░░░ one roof All right ░░░░░░░░ s anything else the ░░░░░░░░ down over I mean ░░░░░░░░ is backlash that the ░░░░░░░░ is still dealing with ░░░░░░░░ investigation by the international ░░░░░░░░ consortium of the investigative ░░░░░░░░ That really pointing out ░░░░░░░░ real good central questions ░░░░░░░░ the company s behavior ░░░░░░░░ to the 10 year ░░░░░░░░ its current CEO Do ░░░░░░░░ see this further affecting ░░░░░░░░ company s reputation and ░░░░░░░░ the bottom line especially ░░░░░░░░ know more more long ░░░░░░░░ You know it s ░░░░░░░░ great question Ali seeing ░░░░░░░░ and I think most ░░░░░░░░ probably Boris behaviors is ░░░░░░░░ the rearview mirror for ░░░░░░░░ company but I think ░░░░░░░░ s something to be ░░░░░░░░ about the culture of ░░░░░░░░ business that s never ░░░░░░░░ accountable for being profitable ░░░░░░░░ creates a culture of ░░░░░░░░ carelessness of lack of ░░░░░░░░ that s never good ░░░░░░░░ term and that sort ░░░░░░░░ you know until they ░░░░░░░░ show us the money ░░░░░░░░ re going to really ░░░░░░░░ doubtful that this is ░░░░░░░░ to be a sustainable ░░░░░░░░ And again I want ░░░░░░░░ I want to it ░░░░░░░░ clear that no matter ░░░░░░░░ you believe about the ░░░░░░░░ of the business and ░░░░░░░░ potential the valuation of ░░░░░░░░ stock implies that uber ░░░░░░░░ going to have close ░░░░░░░░ a 100 of its ░░░░░░░░ addressable market at some ░░░░░░░░ in time so the ░░░░░░░░ even down where it ░░░░░░░░ today 50 below its ░░░░░░░░ time highs It s ░░░░░░░░ extremely optimistic about the ░░░░░░░░ cash flows of the ░░░░░░░░ so they re still ░░░░░░░░ real disconnect here but ░░░░░░░░ valuation and profitability matter ░░░░░░░░ you slice it My ░░░░░░░░ question to you is ░░░░░░░░ to be around your ░░░░░░░░ for the company in ░░░░░░░░ of profitability I think ░░░░░░░░ already know your answer ░░░░░░░░ for the most part ░░░░░░░░ ask you this then ░░░░░░░░ look at him uber ░░░░░░░░ couple years ago a ░░░░░░░░ of people were optimistic ░░░░░░░░ it because you hear ░░░░░░░░ you are detailed Amazon ░░░░░░░░ thing and profitable for ░░░░░░░░ a decade but that ░░░░░░░░ growth story getting into ░░░░░░░░ it is now and ░░░░░░░░ think a lot of ░░░░░░░░ look were to be ░░░░░░░░ kind of next kind ░░░░░░░░ growth story But we ░░░░░░░░ not yet seeing that ░░░░░░░░ here kind of from ░░░░░░░░ you don t expect ░░░░░░░░ to be the case ░░░░░░░░ break down the difference ░░░░░░░░ Well I would say ░░░░░░░░ of the number of ░░░░░░░░ that claim that they ░░░░░░░░ going to be the ░░░░░░░░ Amazon is a long ░░░░░░░░ it seems like it ░░░░░░░░ a way to justify ░░░░░░░░ hey Amazon was improper ░░░░░░░░ point that they became ░░░░░░░░ Most businesses are improper ░░░░░░░░ they re beginning very ░░░░░░░░ actually ever make it ░░░░░░░░ profitability the can harrison ░░░░░░░░ a joke in my ░░░░░░░░ I mean everyone would ░░░░░░░░ themselves to the best ░░░░░░░░ I mean if they ░░░░░░░░ I think the problem ░░░░░░░░ Honestly most investors lack ░░░░░░░░ reliable fundamental research needed ░░░░░░░░ understand just how farcical ░░░░░░░░ comparisons are and look ░░░░░░░░ there s nowhere near ░░░░░░░░ market potential that Amazon ░░░░░░░░ and by the way ░░░░░░░░ you know Amazon was ░░░░░░░░ big bet at the ░░░░░░░░ to was a very ░░░░░░░░ stock It was able ░░░░░░░░ grow into a lot ░░░░░░░░ its valuation it remains ░░░░░░░░ Yeah and it got ░░░░░░░░ an entirely different business ░░░░░░░░ make money that we ░░░░░░░░ even made money to ░░░░░░░░ original business What business ░░░░░░░░ uber might possibly be ░░░░░░░░ to get into I ░░░░░░░░ t know what a ░░░░░░░░ that can make money ░░░░░░░░ is Yeah but I ░░░░░░░░ you that the valuation ░░░░░░░░ that they re going ░░░░░░░░ do that already so ░░░░░░░░ s already priced to ░░░░░░░░ things that are really ░░░░░░░░ Which is a danger ░░░░░░░░ being baked into the ░░░░░░░░ of for the something ░░░░░░░░ now that s as ░░░░░░░░ company is down like ░░░░░░░░ over the past