Uber has 2nd straight quarter of profit, but projections disappoint

Uber released its second quarterly operating profit on Wednesday. Even with demand for the ride-sharing service returning to pre-pandemic levels and the delivery business closing in the black for the first time, the profit forecast for the current quarter fell short of Wall Street’s expectations.

Uber forecast lower-than-expected adjusted earnings for the first three months of 2022 as the Covid-19 Omicron variant reduced demand for travel in January.

Uber projects adjusted first-quarter earnings before interest, taxes, depreciation and amortization of $100 million to $130 million.

That compares with analysts’ estimate of $149.6 million, according to Refinitiv data. The projection for gross reserves between US$ 25 billion and US$ 26 billion was also below estimates, which were US$ 27.3 billion.

But the company said business began to react in February. “While the Ômicron variant started impacting our business in late December, mobility is already starting to recover, with gross bookings rising 25% each month,” Uber Chief Executive Dara Khosrowshahi said in a statement.

In the fourth quarter of 2021, Uber had $5.8 billion in revenue. The delivery unit, made up largely of the restaurant service Uber Eats, had its first positive adjusted Ebitda of $25 million.

Delivery emerged as one of the company’s main strengths during the pandemic. Maintaining delivery booking levels signal that the recovery in rides has not come at the expense of food delivery, with consumers sticking to the service even as the economy reopens.

The company reported an Ebitda of $86 million for the fourth quarter, up from a like-for-like loss of $454 million a year ago, well above analysts’ expectations of $62 million.

Uber made a net profit of $892 million as it revalued stakes in Grab and self-driving company Aurora.