Record Ridership Gets Uber To Second Consecutive Quarterly Profit

Uber Technologies Inc UBER just reported its second ever operating profit in its third quarter report during which it expanded both its rides and food delivery business. Last week, its food delivery rival, DoorDash Inc DASH, reported its best quarter since its IPO.

Uber Reported Record Use Of Its Driving Platform

For the third quarter, Uber reported $9.3 billion in revenue that grew 11% YoY. The mobility segment brought in $5.07 billion, the food delivery business contributed $2.93 billion and the freight business added $1.28 billion to the revenue table. 

From its activities, Uber made a net income of $221 million which is its second straight profit from its own business operations, as opposed to investments in other companies. However, its third quarter results were below LSEG’s estimate which were $9.52 billion for revenue and 12 cents in earnings per share.  But adjusted EBITDA of $1.09 billion topped StreetAccount’s estimate of $1.02 billion as it increased $576 million compared to last year’s comparable quarter. Mobility rose 31% YoY as gross booking amounted to $17.90 billion while the delivery business expanded 18% YoY with gross bookings amounting to $16.09 billion.

Uber noted that the reported quarter marked an important record with 6.5 million drivers who ferried passengers and food around the world. Passengers took 2.4 billion trips which translates to a YoY increase of 25%.

For the undergoing, fourth, quarter, Uber guided for gross bookings in the range from $36.5 billion to $37.5 billion with adjusted EBITDA ranging from $1.18 billion to $1.24 billion.

DoorDash Narrowed Its Net Loss

Last Thursday, DoorDash shares rose more than 15% as the food delivery company reported an acceleration demand and provided a guidance that shows solid growth ahead. With $2.2 billion in third quarter revenue that topped LSEG’s estimate of $2.1 billion, DoorDash improved its bottom line from last year’s comparable quarter when it made a net loss of $295 million, bringing the loss down to $73 million. With 543 million total orders, DoorDash recorded a 24% YoY increase, however this growth rate is lower compared to 27% growth from last year’s comparable quarter. 

When Times Are Hard, We Turn To Food

Even in such uncertain and inflationary times, food remains the category everyone spends in. Luckily for Uber who has long been facing concerns regarding its profitability, inflation-strained consumers are not giving up food delivery nor ride-hailing. While other tech companies turned to massive layoffs over the last year, Uber has generally delivered consistent results during this challenging economic time filled with uncertainty. By the looks of its, it survived the worst during the pandemic which put its ride-sharing business to a halt and it seems to be going up ever since. However, labor disputes remain a threat to its business as its drivers are classified as independent contractors as opposed to employees, saving the ride-hailing leader plenty of money as it is not entitled to provide health insurance nor a minimum wage. But for now, Uber’s business model is yielding great results and fueling the company to expand its footprint in Spain, Japan and Italy.

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