Uber Revenue Beats Estimates As Ride Hailing Demand Rebounds

Source: Predictions based on analysts’ consensus from Visible Alpha

Uber (UBER) Financial Results: Analysis

Uber Technologies Inc. (UBER), the leading global ride sharing company prior to the pandemic, jumped as much as 15% after the company posted third-quarter revenue that beat expectations, even though its loss was triple the consensus forecast.

Uber lost 61 cents a share, compared with a consensus estimate of a 21-cent loss, including about $1 billion in revaluations of the company’s equity investments and stock-based compensation expenses. Revenue jumped 72% to $8.3 billion, beating predictions, aided by Uber Freight’s Transplace purchase and changes to the company’s UK Mobility business model. The company’s ride-hailing growth also rebounded.

Uber’s delivery business is posting slower sales growth after seeing an increase in online order volumes during the pandemic. The company said trips for the third quarter grew 19% or by about 21 million trips per day. Uber recently announced plans to expand its advertising business by allowing targeted ads across its ride-hailing app, a practice that could attract heightened scrutiny from regulators after Uber suffered a high-profile data breach in September.

UBER Gross Bookings

Gross bookings climbed 26% to $29.1 billion, below the predicted $29.6 billion. Mobility gross bookings drove growth, climbing by 38% relative to 7% for delivery gross bookings. Gross bookings are a measure of the total dollar amount generated by Uber’s combined ride-hailing, delivery, and freight-shipping businesses and are positively correlated with Uber’s revenue, the portion of gross bookings that the company claims as its own.

UBER Outlook and Stock Performance

Uber said it expects gross bookings to climb between 23% and 27% for during the fourth quarter to between $30.0 billion and $31.0 billion amid a 7% currency headwind. Adjusted EBITDA is expected to be in the range of $600 million to $630 million.

Shares of Uber rose to $30.68 as of 11 a.m. New York time. The company’s stock has dropped by 40% relative to a 16% decline in the S&P 500 Index in the last year.

Uber’s next earnings report (for Q4 FY 2022) is expected to be released Feb. 8, 2023.