Even though it suffered a $5.6 billion loss as a result of its investments in other ride-sharing firms, particularly the Chinese service Didi, Uber on Wednesday reported significant growth in its ride-hailing and delivery services and claimed it was continuing to bounce back from a global economic crisis.
The business announced sales of $6.9 billion for the first three months of 2022, above analysts’ estimates and increasing by 136 percent compared to the same period last year, when Covid-19 vaccinations were limited and people were not travelling as much. Also during the quarter, Uber said that it had recorded 1.7 billion journeys, representing an 18 percent rise over the same period the previous year, and that it had 115 million individuals using its platform each month, representing a 17 percent increase over the same period the previous year.
As a leading indication of overall economic health and travel demand during the pandemic, Uber’s financial performance have fluctuated in response to surges in coronavirus infections and higher lockdowns, with the company’s better quarters often matching to times of relative normality.
The company’s chief executive said in prepared comments to investors that when people return to their places of work, restaurants, bars, stadiums, and airports throughout the globe, “they’ve returned to Uber.” He went on to say that the company’s achievements “show that we are emerging on a good road out of the epidemic.”
Uber’s investments in other ride-sharing firms throughout the globe, on the other hand, continue to have a negative impact on the company’s bottom line. Changes in the value of other firms in which it has an interest accounted for $5.6 billion of the company’s roughly $6 billion in losses. Since it went public last year, Didi’s stock has seen a significant decline in value.
In the first quarter, Uber’s ride-hailing business saw revenue increase by nearly 200 percent over the same period the previous year, despite a slowdown caused by the Omicron variant of the coronavirus at the beginning of the quarter. Uber’s food-delivery business saw revenue increase by 12 percent, even though people have mostly returned to restaurants and grocery stores.
Despite the fact that Uber’s business continues to lose money, the company said that it was getting closer to profitability. Uber reported another successful quarter, excluding key expenditures such as stock compensation and the losses from Didi, and its free cash flow was on the verge of reaching break-even status.
It has become more difficult to make a living driving for Uber, according to the drivers who fuel the company’s business as well as the businesses of other gig economy companies such as Lyft, DoorDash, and Instacart. High gas prices, which are attributed in part to the Russian invasion of Ukraine, have made it more difficult to make a living driving for Uber. Some have said that they are reducing their working hours or that they are leaving the platform. The value of Uber’s shares, like that of other gig economy businesses, has declined by more than 30 percent since the beginning of this year, according to the company.
Uber, which had already been spending extensively to entice drivers who had left during the early stages of the epidemic, reacted in March by charging clients a tiny fuel cost for each journey, with the proceeds going to drivers. Earlier this week, the company said that it had more drivers on its platform than at any other period since the outbreak started.
That optimism — as well as its optimistic prediction for the next quarter — stands in sharp contrast to that of its competitor Lyft, which released its financial results on Tuesday. During an earnings call, officials from Lyft said that they were still battling to persuade drivers to return to the platform and that they would be spending more money to urge them to do so. Lyft’s stock dropped by 25 percent in after-hours trading.
Uber’s stock dropped in tandem with Lyft’s, and the company announced shortly after that it would release its financial results on Wednesday, hours earlier than originally planned, presumably in an effort to distinguish its results from Lyft’s and avoid a drop in its stock when the market opened later that day. Uber’s shares, on the other hand, plummeted by more than 4% during regular market hours on Tuesday.
While speaking on a conference call with investors on Wednesday, Mr. Khosrowshahi noted that Uber also needed to continue to expand the number of drivers who use its network. However, he offered a more hopeful view of the company’s future by highlighting areas of possible development, such as Uber’s collaborations with taxi firms and its investments in the freight transportation sector.
In terms of driver supply, he stated, “There’s a lot of work ahead of us, but this is a machine that’s rolling.” He went on to say that Uber was “beginning to demonstrate separation versus our competition.”
Despite the fact that Lyft reported a 40 percent increase in active drivers in the first three months of the year compared to the same period the previous year, Logan Green, the company’s chief executive, also stated that drivers had “signed off” during Omicron and had not yet returned in the numbers required to meet rebounding consumer demand.
Lyft announced better-than-expected revenue of $876 million, a 44 percent rise over the first quarter of 2021, and a net loss of $197 million, a 54 percent drop over the same period last year. The firm recorded 17.8 million active riders as of the end of 2021, an increase from 13.5 million at the start of the year but a decrease from the roughly 19 million it reported at the conclusion of the previous year.