What happened 

Uber (UBER 1.04%) shares fell 17.6% in March as the coronavirus outbreak caused people around the world to reduce the number of trips they make. The company relies on physical services to generate revenue, and many such businesses are seeing dramatic drops in transactions. Ridesharing has been no different, seeing the destruction of demand for its services.

A driver checks his cell phone.

Image source: Getty Images.

So what 

On March 19, Uber CEO Dara Khosrowshai said that "the rides segment is seeing 60% to 70% declines in areas hit hardest by [the] coronavirus pandemic." One thing the company has going for it is that the rides segment's expenses are mostly variable, able to adjust with decreases in revenue. However, it appears certain the company will continue losing money throughout the crisis. 

Still, the company looks to have enough cash to survive the pandemic without needing to borrow additional money or issue shares to raise capital. With over $10 billion in cash and equivalents on its balance sheet, that should keep the company afloat during these challenging circumstances. 

The decline in the rides segment is being somewhat offset by increasing demand for its Uber Eats service. As people stay at home more, they're ordering in, and Uber is in a position to play a significant role in food delivery. Admittedly, the Uber Eats segment is still a loss-generating one for the company, but the increase in customers will help it achieve the scale necessary to make it profitable. 

Now what 

Uber will need to navigate through challenging times ahead as the coronavirus pandemic expands its reach. Since no one knows how long the lockdowns will last, it's no wonder investors sold shares of this tech stock