After surprising Wall Street, Uber declared that the pandemic’s impact was “well and truly behind” their business. It has also posted strong quarterly earnings. Uber is focusing on making a profit.
The revenue of the ride-hailing company and the food delivery group rose 49% to $8.6 Billion in the final three months of the year. This beat analysts’ expectations. However, net income fell 33% to $892 M. It was expected to report a loss.
The company’s shares rose sharply in New York at the open, before losing their initial gains. They closed at $36.83 up 5.5 percent, or $1.93
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Dara Khosrowshahi chief executive stated that “the heightened macroeconomic uncertainty was top of mind for both us and indeed it is for shareholders.” “Despite this uncertainty, I am more optimistic than ever about our prospects.”
Uber predicted that it would produce adjusted earnings — a measure that takes out some costs — between $660m and $700m in the first quarter. This is higher than analysts’ expectations of approximately $593 million according to Refinitiv.
Uber’s mobility division which includes its ride-hailing services, saw adjusted earnings increase by more than twice last year, going from $1.6 billion up to $3.3 billion. Khosrowshahi stated that the pandemic’s effect on Uber’s mobility business was now over. It recorded 2.1 billion trips in the last quarter, an increase of 19% over the previous year.
Uber Technologies was founded in 2009 in San Francisco, California. It is most well-known for its ride-hailing app. However, it quickly expanded into food delivery after the introduction of Covid-19. The company went public in May 2019 and has a market capitalization of approximately $69 billion.
Uber’s delivery business earned $551 million in 2022 after a loss of $348 millions the year before. Khosrowshahi stated that “we continue to be encouraged at the progress we’ve made in the US, UK, and other major delivery markets,” “In 2021 we weren’t the market leader in either category and were very unprofitable. These markets have been turned profitable by our teams in 2022. They also maintain or gain category position.
Khosrowshahi stated that Uber in Britain is growing faster than other online delivery markets. He also claimed that Uber One, the group’s subscription service, has made the company more profitable.
Wedbush technology analyst Dan Ives said that Uber is seeing healthy growth. The driver supply seems stable, while the company continues its benefits from travel returning, shifting into the office and other post-pandemic trends. Uber will continue to benefit through 2023.
“After a transitional period of growth, cost-cutting and growth, we now see Uber hit the inflection point of growth (before taxes and other expenses) that Wall Street could only dream of a few decades ago.”