Uber narrows first-quarter loss as it drives fewer people but moves more packages
▶ California company also made a one-off, $1.6bn gain from sale of self-driving unit
Uber narrowed its first quarter net loss to $108 million from $2.9 billion in the same period last year, as its delivery business grew 166 per cent but its ride-hailing business dropped.
The California company benefited from the $1.6bn sale of its self-driving car unit Advanced Technologies Group to start-up Aurora Innovation, backed by Amazon.
Uber’s revenue in the quarter slumped 11 per cent on an annualised basis to $2.9bn, missing analysts’ estimate of $3.2bn.
“We are finally seeing the light at the end of the tunnel,” Dara Khosrowshahi, chief executive of Uber, said on a call with investors.
“Uber is starting to fire on all cylinders, as more consumers are riding with us again while continuing to use our expanding delivery offerings.”
The company’s stock initially surged on the news in regular trading hours but then fell 4.75 per cent to $48.75 a share in after-hours trading. The share price has increased 84 per cent in the past 12 months.
Revenue in the US and Canada declined 11 per cent yearly to $1.8bn in the past quarter. In Latin America, sales dropped 37 per cent to $302m by 52 per cent in Europe, the Middle East and Africa to $225m. However, revenue increased 138 per cent to $527m in the Asia-Pacific region.
The company earned $19.5bn in gross bookings in the past quarter, 24 per cent more than the same period a year earlier.
Delivery gross bookings surged 166 per cent in the period to $12.5bn but mobility bookings declined 38 per cent $6.8bn.
The ride-sharing service, which is gradually bouncing back from pandemic lows, had to absorb a $600m hit after Uber reclassified its drivers as workers in the UK in March and provided them with more benefits.
Despite the losses, Uber is “very well positioned to drive long-term value, with improving ebitda [earnings before interest, taxes, depreciation and amortisation] performance, significant liquidity and increasingly valuable minority investments”, said Nelson Chai, the company’s chief financial officer.
“We outperformed both our gross bookings and adjusted ebitda outlook … with mobility trends improving through the quarter and continued elevated growth for our delivery business, combined with disciplined operational execution.”
Uber’s adjusted ebitda of $359m in the first quarter improved by $253m year-on-year, and almost $95m quarterly.
The number of monthly active platform users was down 5 per cent from the previous year to 98 million in the January-March period.
Its average active user spent nearly $66 in a month and used the platform five times.
Uber, which went public in 2019, cut nearly a quarter of its staff over several rounds of layoffs in the first half of last year as the Covid-19 pandemic upended its core business.
The company aims to become profitable by the end of this year.
“We will continue to innovate and find new ways to deepen engagement with our customers, as the only global platform that helps you go wherever you need and get whatever you want,” Mr Khosrowshahi said.
Restaurants on Uber Eats exceeded 700,000 in the first quarter. The company has joined forces with essentials delivery service Gopuff to launch a convenience offering. Starting next month, consumers can access more than 2,500 convenience store and grocery items in Gopuff’s inventory available for delivery from the Uber Eats app.
Uber is also facing a number of other challenges including a tax case before UK authorities, the pandemic, growing competition and the ability to attract drivers, consumers and other partners to its platform, it said in a statement to the US Securities and Exchange Commission last month.