Following the release of Uber Technologies’ first quarterly earnings report, the stock price fell on Tuesday, below forecasts for sales. The stock, which has nearly doubled this year, failed to gain pace despite better guidance than expected.
Uber (Ticker: UBER) reported earnings of 18 cents per share in the second quarter, as opposed to a loss of $1.33 per share in the same time last year. From $8.07 billion a year earlier to $9.23 billion, the revenue climbed.
Uber was predicted by a FactSet survey to announce adjusted earnings of 16 cents per share on $9.34 billion in revenue.
Uber’s CEO Dara Khosrowshahi stated in a statement: “Strong demand, new initiatives, and continued cost discipline resulted in Uber’s first quarter with a 22% adjusted EBITDA margin and excellent performance.”
Uber has succeeded in making its first year profit since going public in 2019, taking market share away from rival Lyft (LYFT), and reducing costs with strategies including paying drivers more.
Contrary to pre-market estimates, Uber shares opened the trading day down 3.2% at $47.87 as Wall Street analysts became more upbeat about the company’s prospects. Shares of Lyft decreased by 1%.
Gross bookings, the total dollar amount of transactions completed through the Uber app, rose to $33.6 billion, which is 18% more than the same period last year when measured in constant currency. Uber’s growth was fueled by its ride-hailing or mobility business, where gross bookings climbed by 28% to $16.7 billion and by 14% to $15.6 billion for deliveries.
For the third quarter, Uber expects total bookings to be between $34 billion and $35.0 billion, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to be between $975 million and $1.03 billion.
FactSet reports that experts predicted $34.1 billion in total bookings and $927 million in EBITDA for the third quarter.
“With a strong Q3 for healthy growth and cost discipline, we believe [Uber’s] path to $5 billion plus of EBITDA in 2024E and significant positive free cash flow is becoming increasingly clear,” wrote Daniel Ives of Wedbush in a research note on Tuesday.
Nelson Chai, Uber’s chief financial officer, has also made a separate announcement that he will leave the firm on January 5. His replacement is currently being sought by the business.
