Uber Technologies
What really is driving strength in shares is the magnitude of the revenue beat and strong guidance as the company thrives despite challenges for many companies exposed to consumer spending and tech.
Overall, Uber shares are down 32% YTD, but they are up a little more than 40% from their June lows. The company is on the cusp of profitability and is already profitable on an EBITDA basis. Inflation and economic pressures are leading to more growth in the driver pool, and consumers are absorbing higher prices.
Inside the Numbers
In Q3, Uber reported a $0.61 per share loss which was steeper than expectations of a $0.22 per share loss. However, the biggest factor was a write-off on various investments owned by the company. In terms of EBITDA, it topped expectations at $516 billion vs $457 billion.
On an operating performance, the company's numbers were much better as revenue was up 72% and topped expectations at $8.3 billion vs $8.1 billion. The company benefited from strength in the travel sector and the continued normalization of the economy all over the world. It sees October as the best month ever in terms of total gross bookings. For the quarter, gross bookings were up 24%.
Both mobility and delivery had gross bookings of $13.7 billion. However, mobility contributed $3.8 billion in revenue while delivery contributed $2.8 billion and freight added $1.8 billion. The number of active users increased by 14% to reach 124 million.
Next quarter, it sees gross bookings growing between 23% and 27%. It also sees EBITDA between $600 million and $630 million which is better than estimates of $568 million.
Uber also had its own 'supply chain issue' due to a strong economy and a tight labor market which meant there was a lack of drivers. However, this problem seems to be solved as the company is expecting driver capacity to reach pre-pandemic levels in the coming quarters and is already at 80% capacity.
