Uber delivers first-ever operating profit in Q2 as deliveries and bookings grow

Net income in the three months ended June hit $394m, swinging from a $2.6bn loss in the same period last year

Uber reported that six million drivers and couriers earned a record $15.1 billion during the second quarter. Reuters

Uber Technologies reported its first-ever operating profit in the second quarter, underpinned by a growth in deliveries and bookings, as it works to stem long-running losses in its operations.

Net income in the three months ending June 30 reached $394 million, swinging from a $2.6 billion loss in the same period last year, the California-based company said in a statement on Tuesday.

This includes a $386 million pre-tax benefit, primarily due to net unrealised gains related to the revaluation of Uber’s equity investments, it said.

Revenue rose 14 per cent annually to $9.23 billion. Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) soared 152 per cent year-on-year to $916 million, from $364 million in the same period last year.

Uber's stock surged 2.7 per cent to trade at $49.46 a share in pre-market trading on the New York Stock Exchange on Tuesday.

Uber's mobility segment, which counts its ride-hailing services, posted revenue of nearly $4.9 billion, up 38 per cent from $3.6 billion a year ago, while its delivery unit recorded revenue of $3.1 billion, up 14 per cent from $2.7 billion a year earlier.

Its freight operations, however, posted a 30 per cent decline to $1.28 billion, from $1.83 billion in the same period in 2022.

“Robust demand, new growth initiatives and continued cost discipline resulted in an excellent quarter, with trips up 22 per cent and a GAAP [generally accepted accounting principles] operating profit, for the first time in Uber’s history,” Dara Khosrowshahi, chief executive of Uber, said.

“These results also translated into strong driver and courier engagement.”

Uber is a major player in the global ride-hailing and delivery markets, both of which have become essential in daily lives as consumers bank on the convenience they bring through their mobile devices.

Revenue in the ride-hailing and taxi market is expected to hit nearly $360 billion by 2027, from and estimated $312.6 billion in 2023, growing at a compound annual rate of 3.55 per cent, data from Statista shows.

The number of users is projected to reach about 1.45 billion users by 2027, it said.

Income from operations swung to a gain of $326 million in the second quarter, from a loss of $713 million a year ago, the company said. Uber had amassed operating losses of about $31.5 billion since it first reported its financials in 2014.

Nearly six million drivers and couriers earned a record $15.1 billion during the three-month period, Uber said.

Uber's net cash from operating activities stood at $1.2 billion, while free cash flow was at $1.1 billion.

Robust demand, new growth initiatives and continued cost discipline resulted in an excellent quarter, with trips up 22% and a GAAP operating profit, for the first time in Uber’s history

Dara Khosrowshahi,
chief executive of Uber

These reflected “the unique power of the Uber platform and the team’s relentless focus on profitable growth” in the second quarter, chief financial officer Nelson Chai said.

Unrestricted cash, cash equivalents and short-term investments were at $5.5 billion at the end of the second quarter, Uber said.

Looking ahead, Uber expects gross bookings of between $34 billion and $35 billion, and adjusted ebitda of between $975 million to $1.025 billion in the third quarter of 2023.

In May, Uber announced a new type of account for teenagers that will allow them to take rides without a parent or guardian. The new accounts are built for “parents and caretakers of 13-17-year-olds to save precious time with peace of mind”, Mr Khosrowshahi said.

Uber previously required users to be at least 18 to sign up for an account, but now teenagers aged 13 to 17 can have their own accounts and request rides, as long as their profile is linked to a parent or guardian's account.