-
Uber (UBER, $29.75) has forecast fourth-quarter operating profit above Wall Street estimates, betting on cost controls and rising demand for its rides as customers resume spending more on travel, sending its shares up 13%. Despite the business reporting a loss, investors seem keen on its projections.
-
The provider of ride-hailing services and food delivery reported an adjusted loss of 61 cents a share on revenue of $8.34 billion. Analysts expected Uber to report a loss of 18 cents a share on revenue of $8.1 billion. Uber also reported gross bookings of $29.12 billion, which was slightly below estimates of $29.67 billion. But it expects fourth-quarter gross bookings to jump 23% to 27% year-over-year.
-
Monthly active users on Uber's apps rose 14%, exceeding the levels seen in September 2019, helped by airport trips, while revenue from the rideshare segment rose 73% in the third quarter. However, it is looking to scale back hiring and reduce expenses to expand profitability as it warned of a potential hit from a strong dollar to its earnings from overseas.
Why it matters
The company, which had faced driver shortages in the United States during its recovery from pandemic losses, said active drivers are back to September 2019 levels as inflation pushes many to look for sources of additional income. With cities reopening and travel booming, consumers are shifting their budgets to services, Chief Executive Dara Khosrowshahi said, compared to the two years of COVID-led lockdowns when they had limited spending on basic needs.
