Uber ride-sharing income plummets, meals supply greater than doubles

Uber CEO Dara Khosrowshahi walks outdoors of the New York Stock Exchange its extremely anticipated preliminary public providing on May 10, 2019.

Spencer Platt | Getty Images

Uber simply reported second quarter outcomes together with income that beat analysts’ expectations however declined by about 29% from $3.17 billion throughout the identical interval final yr. The inventory dipped greater than 2% in after-hours buying and selling.

Here’s how the ride-hailing and meals supply firm did versus what Wall Street anticipated:

  • Losses: $1.02 per share vs. 86 cents per share (adj.) anticipated, in response to a consensus of analysts surveyed by Refinitiv.
  • Revenue: $2.24 billon vs. $2.18 billion, as per Refinitiv.

Here’s how the enterprise items carried out versus what analysts anticipated for the quarter:

  • Rides (gross bookings): $3.05 billion vs. $3.47 billion anticipated, in response to estimates compiled by StreetAccount
  • Eats (gross bookings): $6.96 billion vs. $6.57 billion anticipated, as per StreetAccount.

During the interval ending June 30, 2020, the coronavirus pandemic continued to restrict individuals’s journey and commuting, and to weigh closely on Uber’s core ride-hailing enterprise, sending gross bookings down 73% in fixed forex measurements. The pandemic did drive demand for Uber’s meals supply enterprise, nonetheless, and bookings had been up 113% there.

On an earnings name Thursday, CEO Dara Khosrowshahi stated, “The Covid disaster has moved supply from a luxurious to a utility.” He believes Uber customers will proceed to order meals and different gadgets by means of Uber supply companies even after the pandemic subsides, and stay-at-home orders are lifted.

Among different new supply companies the corporate is providing, Uber Connect lets customers ship small packages by way of UberX drivers to native locations. The service has made Three million journeys globally because it launched in early June, the CEO stated.

He additionally stated that the ride-hailing enterprise was recovering at completely different charges in numerous elements of the world. Khosrowshahi stated, “When cities transfer once more so does Uber.” Rides had been down 50% to 85% in prime U.S. markets throughout the second quarter, he stated, however in prime European markets, together with France, Spain and Germany, rides had been solely down about 35% year-over-year. 

The firm was capable of slender its web losses to $1.Eight billion, a significant enchancment from final yr when stock-based compensation contributed to a web lack of $5.24 billion.

The firm reported $8.1 billion in money and equivalents, down from $13.7 billion a yr in the past. 

After Covid-19 started to have a significant affect on Uber’s enterprise, the corporate moved quick to put off about 14% of its workforce, greater than 3,500 workers, and to dump its Jump electrical bike enterprise to a bike-sharing competitor referred to as Lime, by which Uber is an investor. 

Despite the efforts to chop some prices, Uber has remained acquisitive. In July, it introduced plans to purchase Postmates, an on-demand supply enterprise, for $2.65 billion in inventory.

On Wednesday, Uber introduced it could acquire Autocab, a U.Ok. taxi software program enterprise, for an undisclosed quantity. Among different issues, Autocab connects riders to native taxi operators by way of its iGo Marketplace app. The deal ought to assist Uber broaden from 40 U.Ok areas to 170.

Uber’s enterprise additionally faces mounting authorized battles over whether or not Uber and rivals like Lyft can proceed to deal with drivers within the United States as impartial contractors. Hiring workers, somewhat than treating employees as impartial contractors, usually prices firms extra and makes them extra accountable for the conduct of those employees whereas they’re on the job.

On Wednesday, the California Labor Commissioner’s workplace announced that it had filed separate lawsuits towards Uber and Lyft accusing them of committing wage theft by misclassifying drivers as contractors somewhat than workers.

In addition, California recently enacted a regulation (AB-5) that makes it exhausting for “gig economic system” firms, together with Uber, to categorise employees as impartial contractors, a New York federal choose ruled that Uber and Lyft drivers should be paid unemployment advantages, and the Pennsylvania Supreme Court ruled that an Uber driver was not self-employed and may have been eligible for unemployment compensation.

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