Uber swings to $221m profit in Q3 on higher bookings

California-based company’s September quarter revenue rose 11% to nearly $9.3bn

Uber's operating income stood at $394 million in the July-September period. Bloomberg

Ride-hailing company Uber swung to a net profit of $221 million in the third quarter, compared with a $1.2 billion loss in the same period last year, driven by an increase in gross bookings and overall sales.

Its operating income stood at $394 million in the quarter that ended on September 30, up from a loss of $495 million year on year.

Meanwhile, the California-based company’s third-quarter revenue rose 11 per cent on an annual basis to nearly $9.3 billion, short of analysts’ expectations of $9.5 billion.

“Our relentless focus on improving the product experience for both consumers and drivers continued to power profitable growth, with trip growth accelerating to 25 per cent,” said Dara Khosrowshahi, Uber's chief executive.

“Uber’s core business is stronger than ever as we enter the busiest period of the year.”

Dara Khosrowshahi, Uber's chief executive. Bloomberg

Uber's combined mobility and delivery divisions revenue grew 21 per cent year on year to $8 billion.

The company also crossed 2.4 billion trips in the last quarter – an average of nearly 1.12 million trips per hour or almost 27 million trips per day. The company defined trips as the number of completed consumer mobility rides and delivery orders in a given period.

The monthly active platform consumers reached 142 million in the previous quarter, up 15 per cent annually.

Following the earnings announcement, shares of Uber dropped 2.89 per cent in pre-market trading to $46.75. The company’s market capitalisation stood at $98.38 billion as of Tuesday.

The company’s gross bookings surged 21 per cent year on year to more than $35.3 billion in the third quarter, more than 4.7 per cent up on a quarterly basis.

Delivery gross bookings increased 18 per cent during the July-September period to $16 billion and mobility bookings surged 31 per cent to $17.9 billion.

Freight unit bookings – which include transport, logistics, supply chain and storage solutions – dropped 27 per cent yearly to $1.3 billion.

The company said the unrestricted cash, cash equivalents and short-term investments were $5.2 billion as of September 30.

​​​​​​​​​​​​​​​​​​​​​​​​The company reported an adjusted income of $1.1 billion before interest, tax and other expenses in the three months to end of September. That was $576 million improvement over the same period in 2022.

Last month, Uber announced a mobility partnership with autonomous driving technology company Waymo in Phoenix. Reuters

In its fourth quarter outlook, the company expects gross bookings to grow in the range of $36.5 billion to $37.5 billion. It expects its adjusted income to range between $1.18 billion and $1.24 billion.

“We continue to make disciplined investments in growth opportunities to support long-term value creation for all stakeholders,” the company’s chief financial officer Nelson Chai said.

“Strong topline trends and record profitability demonstrate the durability of our growth and the significant earnings power underlying our platform.”

The company spent nearly $797 million on research and development, about 8.5 per cent of its total sales in the quarter. This is 4.8 per cent more than what was spent on research and development in the same period in 2021.

In the last quarter, Uber also announced a mobility partnership with an autonomous driving technology company Waymo in Phoenix. Riders can now request a ride and have the chance to be matched with a Waymo vehicle, marking the first time that fully autonomous rides are available on the Uber platform.

Uber has committed to becoming a zero-emissions mobility platform by 2040.

The company said drivers and couriers earned $15.9 billion during the last quarter, an annual rise of 24 per cent.