Yahoo News Uber Jumps After Fourth-Quarter Sales Beat Estimates
(Bloomberg) -- Uber Technologies Inc. rallied in late trading after fourth-quarter revenue topped estimates and the ride-hailing giant reported the most active users in its history, easing fears about a disruption from Covid-19’s omicron variant.
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Revenue rose 83% to $5.8 billion in the period, the company said Wednesday in a statement. That beat the $5.4 billion analysts had projected, according to data compiled by Bloomberg.
“While the omicron variant began to impact our business in late December, mobility is already starting to bounce back,” Chief Executive Officer Dara Khosrowshahi said in the statement, noting that gross bookings are up 25% in the most recent week from a month earlier. The shares jumped as much as 9.5% in extended trading.
Like its rival Lyft Inc., Uber’s progress toward reaching pre-pandemic ridership was thwarted by omicron, which kept people away from offices, schools and social events. The companies’ fortunes have ebbed and flowed along with Covid-19 infection rates and restrictions, which affect demand for rides as well as meal delivery. Lyft reported fewer riders than analysts expected in the fourth quarter, but also recorded its highest-ever revenue per rider.
In the three months ending Dec. 31, Uber reported $25.9 billion in gross bookings, which encompass ride hailing, food delivery and freight, a 51% increase from the same period last year. Monthly active platform users reached an all-time high of 118 million.
“Our results demonstrate just how far we’ve come since the beginning of the pandemic,” Khosrowshahi said.
While Uber’s gross mobility bookings grew 67% from a year earlier to $11.3 billion, in line with analysts’ expectations, they are still about 16% lower than pre-Covid levels.
Uber offered a tempered forecast to account for an impact from omicron, projecting gross bookings of $25 billion to $26 billion in the first quarter. Analysts expected $27 million.
The pandemic fundamentally changed Uber’s business composition, forcing it to bolster its delivery unit when demand for rides plummeted. The company expanded offerings to include grocery, alcohol and convenience items, which have contributed to bookings in the delivery segment eclipsing mobility. Uber’s deliver business had its first profit last quarter on the basis of adjusted earnings before interest, tax, depreciation and amortization, reaching $25 million.
A key challenge to a recovery for Lyft and Uber has been a shortage of drivers to meet customer demand. The imbalance has resulted in higher wait times and fares. But that’s improving, Khosrowshahi said in a conference call with analysts.
“We are entering this year with the best supply since 2020,” he said. “Onboarding conversion rates are happening much more successfully.”
Uber, based in San Francisco, has increasingly focused on refining its membership service to increase user retention rates across meal delivery and rides. Adjusted Ebitda was $86 million in the fourth quarter. Analysts expected $63.6 million.
Uber’s unrealized gains from stakes in Grab Holdings Ltd. and Aurora Innovation Inc. reaped $1.4 billion, which contributed to net income of $892 million.
(Updates shares and adds CEO comment in 11th paragraph.)
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