Uber shares drop despite first operating profit, missed revenue expectations

Uber's stock experienced a decline of over 5% in trading on Tuesday following the release of the company's second-quarter results.

While Uber reported its first-ever operating profit and earnings per share that exceeded analyst projections, its revenue fell short of expectations.

Uber reported earnings per share of 18 cents, a stark contrast to the anticipated 1 cent loss forecast by analysts from Refinitiv. This marked an impressive improvement from the net loss of $2.6 billion in the same quarter of the previous year.

Despite achieving an operating profit, Uber's revenue for the quarter totaled $9.23 billion, falling short of the expected $9.33 billion projected by analysts. The revenue figure still represented a 14% increase from the corresponding quarter in the previous year.

CEO Dara Khosrowshahi highlighted two significant achievements during the quarter: Uber's first-ever quarter of free cash flow surpassing $1 billion and its first GAAP operating profit. Khosrowshahi expressed confidence in the company's profitability going forward.

Uber's mobility segment reported gross bookings of $16.73 billion, marking a 25% increase compared to the previous year. Meanwhile, the delivery segment's gross bookings were $15.60 billion, up 12% year-over-year.

Uber's freight business experienced a decline in sales, totaling $1.28 billion for the quarter, down from $1.83 billion in the same period last year. CEO Khosrowshahi linked the challenges in the freight sector to consumer spending preferences.

For the third quarter of 2023, Uber anticipates gross bookings ranging between $34 billion and $35 billion, along with adjusted EBITDA between $975 million and $1.025 billion. These projections exceeded analysts' expectations and demonstrated the company's optimism for the upcoming months.

Despite the challenges, the number of monthly active users of the Uber platform increased to 137 million, marking a 12% year-on-year growth. During the quarter, 2.3 billion rides were taken, up 22% year-on-year.