Uber Puts Aside Revenue Miss With A Long-Awaited Milestone And Rosy Guidance

Uber Technologies UBER saw its shares rise 1% in premarket today despite a second quarter revenue miss. Besides achieving two long-awaited financial milestones during the quarter, Uber offered a rosy guidance that compensated for missing revenue expectations.

Second Quarter Highlights

For the quarter that ended on June 30th, Uber generated sales of $9.23 billion, coming in below the expected $9.33 billion. Revenue rose 14% YoY and brought a net income of $394 million, or 18 cents per share, coming a long way since the net loss from 2022’s comparable quarter of $2.6 billion, or $1.33 per share. Refinitiv’s consensus EPS estimate was a loss of 1 cent. Adjusted EBITDA rose 152% YoY to $916 million with gross bookings coming in at $33.6 billion, marking a 16% YoY increase.

As noted by CEO Dara Khosrowshah, this was Uber’s first quarter where free cash flow exceeded $1 billion as well as the first quarter that Uber made a GAAP operating profit. Khosrowshah attributed these milestones to a disciplined execution, record audience and strong engagement of Uber’s users.

Segments 

Mobility brought in $4.89 billion to the revenue table, followed by delivery’s $3.06 billion and freight’s $1.28 billion. While the freight business contracted from last year’s comparable quarter when it brought in $1.83 billion as consumers are spending more on services as opposed to shipping, mobility gross bookings rose 25% YoY to $16.73 billion and delivery booking increased 12% YoY to $15.60 billion. Fortunately for Uber, monthly active platform consumers base expanded 12% YoY to 137 million.

Rosy Third Quarter Guidance That Exceeded Estimates

Uber expected gross bookings in the range between $34 billion to $35 billion with an adjusted EBITDA in the range between $975 million to $1.025 billion, both beating StreetAccount’s estimates.

Nelson Chai who has been in charge as CFO since 2018 is announced to be leaving the company in January 2024, with the search for his successor being underway.

All in all, Uber came out of the pandemic leaner and some might argue meaner with its leadership, but it certainly learned how to be more efficient, as shown by its first operating profit, a long-awaited milestone.

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