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Uber's Year From Hell Doesn't Seem to Be Hurting Its Business

Uber's dramatic year dealing with sexual harassment allegations, lawsuits, firings and the departure of its CEO isn't hurting its business.
Image: iPhone Uber app
A mobile telephone displays the Uber app in central London on Oct. 28, 2016.Toby Melville / Reuters

Uber's had the year from hell, but business couldn't be better.

The ride-hailing company, which is entering its 65th day with no CEO, has faced a tumultuous year, dealing with issues of sexual harassment in the workplace and a string of high-profile departures. Then there's the rash of lawsuits. Former CEO Travis Kalanick is being sued for fraud by one of Uber's biggest investors, which is seeking to kick him off the company's board of directors. Another lawsuit from arch-rival Waymo claims a former employee took self-driving car trade secrets to Uber.

Despite all of this, Uber — which is valued at around $70 billion — has continued to thrive. Bookings jumped 17 percent in the second quarter of this year, according to a financial report first obtained by Axios. That's double from the previous year. In addition, the rideshare giant reduced its quarterly losses to $645 million, down from a high of almost $1 billion in the last quarter of 2016.

Bookings jumped 17 percent in the second quarter of this year.

In addition, tipping, one of the ways Uber is bolstering its relationship with its drivers, appears to be working. Passengers have left their drivers $50 million in tips since the option was first introduced in June.

As a privately held company, Uber doesn't have to publicly report its financial information. However, the latest report shows that despite the turmoil at the ride-hailing company, it is managing to weather the storm.

Related: Inside the Place Where Uber Tries to Make Nice With Its Drivers

As the company seeks to turn the page on its troubled past, the board is now facing one of its biggest challenges yet: finding someone willing to take on one of the most high profile yet unattractive jobs in Silicon Valley, if not the entire world — that of CEO.

Stepping into the top spot at the $70 billion private company may have seemed like a plum job a few years ago, but Uber's next CEO will inherit a company plagued by — but determined to deal with — a host of problems.

"Whoever takes this job is entering the perfect storm," Sam Culbert, a professor of management at UCLA and the author of "Good People/Bad Managers," told NBC News.

Uber's workplace culture was thrust into the spotlight in February when Susan Fowler, a former engineer, published a blog post detailing sexual harassment and gender bias in the workplace.

The blog post prompted two independent investigations that led to 20 people being fired in June. One investigation examined more than 200 allegations from other Uber employees; while the other, spearheaded by former attorney general Eric Holder, painted broader strokes recommending what Uber can do to improve its workplace culture.

Kalanick initially said he would take a leave of absence after the reports were released and give up some of his responsibilities, per the board's recommendation. One week later, he resigned, also citing the need to take time off to grieve for his mother, who was killed in a boating accident in May.

While plenty of names have been tossed around for the top spot, some have made it clear they aren't interested. Meg Whitman, CEO of Hewlett Packard Enterprise, was reported to be a leading contender for the position.

She shut down speculation last month with a tweet.

When Facebook COO Sheryl Sandberg's name was mentioned in a report in June, a source close to the executive told NBC News it wouldn't be happening.

All eyes now seem to be on General Electric chairman Jeff Immelt. The 61-year-old seasoned executive would fit the bill for the experienced leader Uber is looking for. But if he is offered the position, Immelt will certainly have his work cut out for him.

Whoever is brave enough to step into the role of CEO of Uber will not only be at the helm of steering the company culture toward what Kalanick called "Uber 2.0," but they'll also be dealing with a mountain other problems - including lawsuits.

Perhaps the most high profile lawsuit pits Waymo, the self-driving car company that used to be a part of Google, against Uber over alleged theft of trade secrets.

In May, a federal judge denied Uber's request to move the case to private arbitration and referred the lawsuit to the U.S. attorney for investigation.

The lawsuit centers around whether Anthony Levandowski, who used to work at Google's self-driving car division (now known as Waymo) and had led Uber's self-driving ambitions, left the company with trade secrets. Levandowski is not named in the lawsuit but has remained a key figure in the proceedings. He left Uber in May.

If the case does not get resolved in Uber's favor, it could strike a serious blow to the company's ability to develop and compete with self-driving technology, Rebecca Lindland, executive analyst at Kelley Blue Book, told NBC News.

"They would basically have to start from scratch on starting autonomous tech which is what Google [Waymo] has been working on for the better part of seven years," she said.

Uber's closest rival, Lyft, is working with Waymo on self-driving car projects. While Lyft is still a distant second in terms of market share, it has been profiting on Uber's missteps as disgruntled riders have made the switch.

"Whoever takes the CEO job is entering the perfect storm."

“There’s nothing to celebrate in this situation,” John Zimmer, Lyft co-founder and president, told the New York Times. “But it does shine a light on the importance of values and ethics.”

Uber's relationship with drivers has also been one that has — in some cases — been fraught with tension. The new CEO will not only need to lead internally, but also gain the respect of drivers, the people who are essentially the beating heart of Uber, Culbert said.

In addition to hiring a CEO, Uber also needs to plug other executive roles, including COO, CFO and SVP of Business.

But Culbert warned that we shouldn't expect whoever steps into the new role to be squeaky clean.

"They're now going to hire a CEO who probably has issues yet to be discovered," he said. "Everyone has flaws and imperfections."