Dara Khosrowshahi, CEO of Uber, speaks at a product launch event in San Francisco, California on September 26, 2019.
Philip Pacheco | AFP via Getty Images
Uber beat estimates in the black and improved its net losses dramatically in the first quarter, but missed sales.
In over-the-counter trading, shares rose around 1%.
Here’s how Uber responded to expectations:
- Loss: According to a consensus of the analysts surveyed by Refinitiv, 6 cents compared to 54 cents are expected.
- Revenue: $ 2.90 billion versus $ 3.29 billion expected per refinitive.
It’s difficult for investors to compare the company’s annual figures as the Covid-19 pandemic hit a year ago and travel was severely restricted. However, ridesharing is gradually recovering from its pandemic lows as coronavirus vaccines are introduced and restrictions are relaxed.
Overall, Uber’s net loss was $ 108 million, a huge improvement over a loss of $ 968 million in the fourth quarter of 2020. However, that was mainly due to a gain of $ 1.6 billion on the sale of its ATG self-propelled unit. Uber’s operating loss was still high at more than $ 1.5 billion for the quarter.
Uber is committed to achieving profitability on an Adjusted EBITDA basis by the end of this year, and investors will be waiting for updates to be included in its earnings call later on Wednesday.
Adjusted EBITDA loss was $ 359 million, up $ 95 million from the previous quarter. EBITDA relates to earnings before interest, taxes, depreciation and amortization.
Here’s how Uber’s largest businesses performed in the first quarter of 2021:
- Mobility (gross bookings): $ 6.77 billion, down 38% from a year earlier
- Delivery (gross postings): $ 12.46 billion, up 166% over the previous year
Delivery revenues also exceeded core business at $ 1.7 billion versus $ 853 million. The company has relied on its delivery services to make up for transit lost during the pandemic. Uber said sales for the Eats segment were up 28% from the previous quarter.
“Uber is starting to fire at all cylinders as more and more consumers ride with us and continue to take advantage of our growing delivery offering,” said CEO Dara Khosrowshahi in the earnings report.
In an update to shareholders, the company announced that Uber Eats retailers topped 700,000 in the first quarter, adding Mr. Beast Burger, Rite Aid and Smoothie King.
The company has also reached an agreement with Gopuff to offer more convenience stores and groceries from June.
Uber is also facing an immediate and growing need for more drivers struggling to meet demand for Covid vaccines and a relaxation of restrictions. The company announced last month it was spending $ 250 million on a one-time incentive to get drivers back on the road. If it doesn’t match the offering, the company could face disgruntled customers who need to spend more money or even provide more incentives.
Uber said it had approximately 3.5 million drivers and couriers on its platform, up 4% from the previous quarter but still down 22% from a year earlier.
The trips on the platform remained unchanged quarter-on-quarter at 1.45 billion and were 13% below the same quarter of the previous year. The company said its continued growth in delivery trips would offset the declines in its mobility unit.
Uber also faced pressure during the UK quarter after the country’s Supreme Court upheld a ruling that its drivers are workers and not independent contractors.
By classifying drivers as contractors, companies can avoid the costly benefits associated with employment, such as unemployment insurance. If a similar measure is passed in the US, it could make it difficult to achieve profitability.
This story evolves. Please update for updates.