Uber Technologies (NYSE: UBER) was initially higher following its Q3 earnings report, however, it quickly gave up these gains in the ensuing sessions. Uber was an exception as many travel stocks posted strong gains in the quarter which also saw many growth stocks return to new highs due to outperforming on earnings and raising guidance.
The company posted a surprise loss due to taking a big write-down on its investment in Didi Global (NYSE: DIDI) which has been quite weak since its IPO due to regulatory issues. However, it should be expected that Uber should do well going forward given the improvements in the coronavirus situation which is boosting the fortunes of hotel and travel stocks. One challenge is the availability of drivers as Uber deals with a tight labor market, like so many other companies in various industries.
Inside the Numbers
In Q3, Uber reported a loss of $1.28 per share which was well above expectations of a loss of $0.33 per share. Revenue came in higher than expectations at $4.8 billion vs expectations of $4.4 billion. Compared to last year, revenue is 54% higher.
Without taking into Uber's investment write-down of Didi, Uber reported its first adjusted EBITDA profit of $8 million which was a significant improvement from its EBITDA loss of $507 million in Q2. Uber Eats has maintained the gains it made during the pandemic despite the world returning closer to normal.
Gross bookings in the delivery segment came in at $12.8 billion, a 50% increase from last year. Mobility gross bookings were up 67% to $9.9 billion. Delivery revenue continues to outpace ride-hailing revenue slightly at $2.24 billion vs $2.2 billion while freight revenge brought in $402 million.
It's also seeing improvement with 60% driver growth in Q3 and 10 weeks of driver growth on the platform. Due to this, surge pricing incidents and wait times have declined. The company also said that trips to the airport increased by 35% and 203% compared to last year.
Overall, there was a total of 1.64 billion trips in Q3, a 9% increase from Q2 and 39% from last year. Uber forecasts gross bookings between $25 billion and $26 billion in Q4 and adjusted EBITDA of $25 million to $75 million.