Uber narrows loss to $6.76bn in 2020 as delivery service picks up

The San Francisco-based company's stock closed 6.1% up at $63.2 per share on Wednesday

The value of Saudi Arabia's Public Investment Fund's Uber investment, its biggest US stock holding, rose to $3.7bn at the end of the fourth quarter, from $2.66bn. Reuters AP

Uber posted a full-year net loss of $6.76 billion for 2020, 20 per cent lower than in 2019, as its delivery service picked up while its ride-sharing business slumped.

Revenue during the period dropped 14 per cent on the previous year to $11.1bn as the company’s ride sharing service registered declines in bookings due to Covid-19 restrictions and lockdowns across the world.

Despite the losses, Uber remains "well on track to achieving our profitability goals in 2021", the company's chief financial officer Nelson Chai said in a statement late Wednesday.

The company narrowed its fourth quarter net loss by 12 per cent to $968 million, while revenue dropped 16 per cent to $3.16bn during the period.

Revenue in the US and Canada declined 26 per cent in the last quarter, followed by a 43 per cent drop in Latin America but a 25 per cent increase in Europe, the Middle East and Africa and a 70 per cent increase in the Asia-Pacific region.

Uber sees “many many opportunities” in the mobility business as different regions gradually recover from the Covid-19 pandemic, Dara Khosrowshahi, the company’s chief executive, said.

However, the timing for a complete recovery depends on when countries fully re-open, he added.

Uber’s stock closed 6.1 per cent up at $63.20 per share on Wednesday. It fell 4.8 per cent in after-hours trading to $60.10 a share.

"While 2020 certainly tested our resilience, it also dramatically accelerated our capabilities in local commerce," Mr Khosrowshahi said.

"With two global businesses stitched together by world-class tech and increasingly valuable membership programmes, we are more focused than ever on making people’s lives a little bit easier … helping them go wherever they want and get whatever they need," he added.

In the last three months of 2020, Uber’s ride-hailing business slowly recovered while its delivery business boomed.

The company earned $17.2bn in gross bookings in the last quarter, 5 per cent less than the same period a year earlier. Delivery gross bookings surged 128 per cent in the period and mobility bookings declined 47 per cent.

Uber’s delivery business more than doubled in 2020 to nearly $44bn in annual bookings. Restaurants on Uber Eats exceeded 600,000 in the fourth quarter to December 31.

The company has expanded its delivery business beyond meals. Last year, it acquired new businesses like Cornershop in Mexico for groceries and Postmates courier service (which delivers Apple products) while divesting others like ATG and Jump to structurally lower its cost base.

"These decisions have resulted in a much more focused and ultimately stronger company," Mr Chai said.

Uber, which went public in 2019, cut nearly a quarter of its staff over multiple rounds of layoffs in the first half of last year as the Covid-19 pandemic upended its core business.