Uber shares rise 8% because the transportation firm raises its outlook
Dara Khosrowshahi, CEO of Uber, speaks at a product launch event in San Francisco, California on September 26, 2019.
Philip Pacheco | AFP via Getty Images
Uber raised its financial outlook for the third quarter on Tuesday, with bookings and adjusted earnings now likely to be better than initially reported.
The company’s shares rose 8.75% in the morning.
The ride-hailing company said in an SEC filing that it now expects to report $ 22.8 billion to $ 23.2 billion in gross bookings for the current quarter, adjusted from $ 22 billion to $ 24 billion Dollars that it had forecast for the second quarter when it called up earnings.
Gross bookings for the second quarter were $ 21.5 billion, with mobility accounting for $ 8.6 billion and grocery delivery accounting for $ 12.9 billion.
“They say a crisis creates opportunity, and that has certainly been true of Uber for the past 18 months,” CEO Dara Khosrowshahi said in the filing.
Uber also said it now expects adjusted earnings before interest, taxes, depreciation and amortization to range from a loss of $ 25 million to a profit of $ 25 million. Uber previously said it expects adjusted EBITDA for the third quarter to be better than a loss of $ 100 million.
Looking ahead, Uber reiterated that on an adjusted EBITDA basis, it should post a profit in the fourth quarter. However, it added that “significant forecast uncertainty” remains a factor.
In the second quarter, Uber reported 1.51 billion trips on the platform, up 4% over the first quarter and 105% over the year-ago quarter. Uber said its drivers and couriers made a total of $ 7.9 billion for the quarter.
Uber and other competitors have struggled with supply and demand imbalances due to the coronavirus pandemic, leading to price hikes and longer waiting times. Khosrowshahi said on a call with investors that prices and waiting times are not meeting corporate goals.
“In the second quarter, we invested in the recovery by investing in drivers, and we’ve made great strides, with monthly active drivers and couriers in the US increasing nearly 420,000 from February to July,” Khosrowshahi said in one Explanation.
In an interview with CNBC on Tuesday, Khosrowshahi said he expected prices to drop in the second half of this year.
– Additional coverage from CNBC’s Jessica Bursztynsky.