Uber Q1 revenue rises, losses narrow
Better results achieved even as many people delete the firm’s app from their phones
SAN FRANCISCO: Uber Technologies Inc’s revenue increased to US$3.4bil in the first quarter and losses narrowed, even as hundreds of thousands of people deleted the company’s ride-hailing app from their phones.
The company also said its head of finance, Gautam Gupta, is leaving. Gupta, who has long served as de facto chief financial officer even though he never earned the title, helped oversee investor calls and run the finance team.
But there had been persistent questions from employees and investors about whether he had the experience to lead Uber through an eventual initial public offering. Uber said it’s now searching for a true CFO who can woo Wall Street.
Uber has faced a series of public-relations crises this year. The hashtag #DeleteUber trended on Twitter as users removed the application from their phones in protest of the company’s ties to US president Donald Trump.
Chief executive officer Travis Kalanick left Trump’s business advisory board in response.
Then, after Bloomberg published a video of Kalanick arguing with an Uber driver, the embattled CEO said he would seek leadership help.
The company is searching for a chief operating officer and fending off a lawsuit from Alphabet Inc over driverless-car technology.
The San Francisco-based startup’s first-quarter loss was US$708mil, shrinking from the US$991mil loss in the previous period. The company’s ability to boost revenue and narrow losses even amid the customer protests reflects the global nature of its business – most of the app deletions took place in the US. The first-quarter financial details and Gupta’s exit were reported earlier on Wednesday by the Wall Street Journal.
Uber, valued at US$69bil, has raised more than US$15bil in funding in its seven-year history. Uber said it has US$7.2bil of cash on hand.
In the fourth quarter, the company generated US$6.9bil in gross bookings and US$2.9bil in net reve- nue. For all of 2016, Uber’s global losses, excluding its China business, totaled US$2.8bil. The company lost at least another US$1bil in China last year.
In a note announcing his departure to employees, Gupta said he’s leaving to join another San Francisco startup as chief operating officer, “to take on a new challenge.”
Kalanick praised Gupta in an emailed statement. “Gautam is a world-class financial talent,” the CEO wrote.
“Over the last four years, he has been indispensible in helping build Uber from an idea into the business it is today.”
Uber reports net revenue using generally accepted accounting principles, but this calculation has drawbacks: For its carpool service and in cities where it uses upfront pricing, the company records the entire the fare as revenue instead of just the amount Uber keeps from drivers.
Uber’s non-GAAP revenue is significantly lower. In the fourth quarter, Uber generated US$1.4bil in non-GAAP net revenue. Last quarter, non-GAAP revenue grew to US$1.5bil.
Meanwhile, GAAP revenue grew much more quickly as more people carpool. The amount increased to US$3.4bil in the first quarter from US$2.9bil in the previous quarter. – Bloomberg