Shares of Uber closed 18.9 percent on Tuesday after the company beat estimate for second-quarter revenue. Although the company reported a loss, it posted $382 million in free cash flow for the first time ever.
The company reported a loss of $1.33 per share. Revenue for the quarter came in at $80.07 billion beating analysts’ estimate of $7.39 billion, according to Refinitiv. Uber reported a net loss of $2.6 billion for the quarter out of which $1.7 billion can be traced to its investments and a revaluation of stakes in Zomato (which reported disappointing second-quarter earnings), Aurora, and Grab.
In a statement, the company’s Chief Executive Officer Dara Khosrowshashi mentioned that Uber continues to profit from an increase in on-demand transportation and an increase in spending on services.
The company reported adjusted EBITDA of $364 million which surpasses the range of $240 million to $270 million it provided in the first quarter, by quite a gap. Gross bookings were up 33 percent year-over-year and stood at $29.1 billion. The company had also forecasted a range of $28.5 billion to $29.5 billion in the first quarter.
Gross bookings for mobility came in at $13.4 billion and were up 57 percent from a year ago. Gross bookings for the second quarter were up 12 percent from a year ago at $13.9 billion.
The company’s mobility segment saw revenue of $3.55 billion while its delivery segment saw its revenue come in at $2.69 billion. Its freight delivery segment recorded $1.83 billion in second-quarter revenue.
The company was able to retain and add drivers irrespective of an increase in fuel prices. “Driver engagement reached another post-pandemic high in Q2, and we saw an acceleration in both active and new driver growth in the quarter. Against the backdrop of elevated gas prices globally, this is a resounding endorsement of the value drivers continue to see in Uber. Consequently, in July, surge and wait times are near their lowest levels in a year in several markets, including the US, and our Mobility category position is at or near a multi-year high in the US, Canada, Brazil, and Australia,” the company’s CEO said.
The company recently announced plans to allow users to choose the trips they want, and this is expected to attract and keep drivers. Drivers will also be able to see how much they’ll earn before they accept a trip.
For the second quarter, Uber had 1.87 billion trips. This is up 9 percent from the first quarter and 24 percent year-over-year. Monthly active platform consumers went up to 122 million, up 21% year-over-year. Drivers and couriers earned an aggregate of $10.8 billion during the quarter, up 37% year over year, the company said.
While speaking on a call with investors, Uber’s CEO noted that new driver sign-ups were up 76 percent year-over-year. According to him, inflation and the cost of living pushed people to join the platform. “The most obvious effect of inflation seems to be getting more drivers on the platform,” he said.
The company also gained from a resurgence in travel as airport gross bookings reached pre-pandemic levels- 15 percent of total mobility gross bookings, up 139% year-over-year.
For guidance, Uber expects adjusted EBITDA of between $440 million to $470 million and gross bookings of between $29 billion and $30 billion for the third quarter.
Ibhadojemu Lucky Emmanuel is a graduate of Education and Economics from the University of Benin. He has a passion for tech and business and has been writing professionally for over a period of five years. He's written across various topics and segments and knew tech-business was it when he first stumbled on it. He has a great passion for music and arts, and wants to visit as many countries as he can someday.
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