Uber’s Rides, Delivery Lift First-Quarter Results

While Uber posted a loss during the quarter, one of its most closely watched financial metrics—adjusted earnings before interest, taxes, depreciation and amortization—hit $761 million, beating Wall Street’s expectations. That figure strips out some expenses that executives consider outside a company’s core operations. Uber has long pointed to it to signal a path to profit.

Uber projected continuing growth and said it expects adjusted earnings of between $800 million and $850 million in the current June quarter, above what analysts surveyed by FactSet had been expecting. 

That outlook signals that the company is “well positioned to improve our competitive position” even as “the operating environment adjusts to a period of tighter capital availability and higher interest rates,” Chief Executive Dara Khosrowshahi said. 

The company narrowed its quarterly loss to $157 million from $5.93 billion in the same period a year earlier, when its bottom line was hit by plummeting stock prices and the diminishing value of Uber’s investments in other companies.

Uber’s rides and delivery expansion offset weak results from its smaller freight division, whose revenue declined 23% during the quarter. The unit cut about 150 people, or roughly 3% of its staff, earlier this year. Uber hasn’t made widespread layoffs as other tech companies have in recent months. 

“We now expect to hold head count flat to down through the coming quarters,” Mr. Khosrowshahi said. 

Uber’s delivery business became its lifeline during the pandemic, as people ordered restaurant food and groceries delivered to their homes. That business has continued to expand even since restaurants reopened and, though growth has cooled from pandemic peaks, Uber Eats has improved its margins by rolling out ads on the platform, raising people’s order totals by expanding into higher-value items such as alcohol and lowering delivery costs by combining those items with food.

Uber’s ride-share business had struggled with a yearlong driver shortage since the U.S. reopened after pandemic lockdowns. But the company was quicker to invest in driver bonuses and roll out new features to entice gig workers, gaining market share and drivers at the expense of rival .

Mr. Khosrowshahi said the company added over one million active drivers during the quarter worldwide, resulting in a 35% year-over-year jump in active drivers. 

He didn’t disclose how many ride-share drivers the company has in the U.S., but said that driver engagement was up in the U.S. and Canada even as Uber had pulled back on bonuses compared with the same quarter a year earlier. Being better supplied, he said, led fares in the region to decline 7% from highs in the second quarter of 2022.

In March, Uber and Lyft won a court order that preserved their gig-worker model in California and could boost their efforts to do so elsewhere in the U.S.

Write to Preetika Rana at [email protected]

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