Uber forecasts first-ever adjusted profit, shares jump 6%
The company, which has yet to book a profit as it spent billions on growing its business, said it expects third-quarter gross bookings between $22.8 billion and $23.2 billion compared with its prior forecast of $22 billion and $24 billion.
Low demand for cabs and a shortage of drivers during the pandemic hurt business at Uber and smaller rival Lyft Inc last year, as many consumers preferred to invest in a car or worked from home for the most part of the year. However, Uber’s food delivery business boomed as more people ordered in.
Lyft Inc in August posted an adjusted quarterly profit three months ahead o
f target, helped by lower costs and demand for rides as offices reopened. https://reut.rs/3nS3zuI
“We’ve not only grown our global leadership across both mobility and delivery; we’ve done so more profitably than ever before… Uber is reaching an important milestone,” Uber Chief Executive Officer Dara Khosrowshahi said on Tuesday.
Uber expects third-quarter adjusted EBITDA, which is the profitability metric Uber uses, between a loss of $25 million and a profit of $25 million, compared with the prior forecast of a loss of $100 million.
The company said last month riders returned to its platform in greater numbers in July, and that it expects the trend to continue in the coming months, together with strong food delivery orders. It had forecast to reach adjusted EBITDA profitability by the fourth quarter.
It now expects to post fourth-quarter adjusted EBITDA, which excludes the cost of extensive stock-based compensation and other potentially significant items, of up to $100 million.
(Reporting by Nivedita Balu and Akanksha Rana in Bengaluru; Editing by Shinjini Ganguli)