Tech

Uber shares slide ahead of lockup expiration

Key Points
  • Uber shares slid in early trading Wednesday as the company's post-IPO lockup is set to expire.
  • Analysts have warned it could put near-term pressure on the shares.
Dara Khosrowshahi, CEO of Uber, speaking at the 2019 DealBook Conference in New York on Nov. 6th, 2019.
Photo: Mike Cohen

Shares of Uber fell to fresh lows Wednesday as investors await the company's IPO lockup agreement to expire.

The stock slid 3.8% on Wednesday, after falling 8.7% earlier in the day. The plunge caused the shares to hit a new all-time low of $25.58 in intraday trading.

Wednesday is the first time since Uber's IPO in May that insiders can sell the stock and analysts have warned it could put near-term pressure on the shares. Roughly 90% of Uber's stock will be available for sale, according to analysts at MKM Partners.

Uber's lockup expiration may not be as volatile as some analysts are expecting, since many pre-IPO shareholders are underwater. The stock has fallen 40% since the company went public at $45 earlier this year. The shares closed at a record low of $28.02 on Tuesday after the company reported more than $1 billion in net losses in its third-quarter results.

Additionally, investors will be waiting to see if some of the biggest buyers of Uber's pre-IPO shares will participate when the lockup expires, like SoftBank, Morgan Stanley and Fidelity, among others. Wedbush analysts estimated that 763 million shares will unlock on Wednesday, with 25% of them being sold by early stage private investors.

Uber CEO Dara Khosrowshahi commented on the company's stock performance Wednesday at The New York Times Dealbook conference, reiterating its path to profitability.

"I think we are set on a very strong path, and now we have to execute," he said. "And you know, the market is betting against us, and that's fine with me."

— CNBC's Ari Levy contributed to this story.

Early Uber investor Bradley Tusk on why he plans to sell some of his shares
VIDEO6:0506:05
Early Uber investor Bradley Tusk on why he plans to sell some of his shares