Uber reported third-quarter operating income of US$1.11-billion, missing estimates of US$1.61-billion.Richard Drew/The Associated Press
Uber UBER-N missed operating profit expectations on Tuesday and issued a downbeat earnings forecast for the key holiday quarter, overshadowing strong demand for its rides and food deliveries driven by growing adoption of its membership program.
The company blamed the weak profit on undisclosed legal and regulatory matters. Its shares fell nearly 9 per cent in premarket trade, following a more than 60-per-cent rise in the stock so far this year.
CEO Dara Khosrowshahi said the Uber One program was encouraging customers to book more food and grocery deliveries as the company surpassed quarterly revenue and gross bookings expectations.
The delivery segment posted a 29-per-cent sales rise in the July-September quarter, outpacing the 20-per-cent increase in mobility revenue and flat growth in the freight division.
Consumers who use more than one of Uber’s services have 35-per-cent higher retention and spend three times more than others, Khosrowshahi said. Only about 20 per cent of active users in markets with rides and delivery use them together, though top-performing countries already surpass that level.
Shopify posts higher profit, forecasts a better than expected fourth quarter
Uber reported operating income of US$1.11-billion, missing estimates of US$1.61-billion, according to Visible Alpha data. Its forecast for current-quarter adjusted core profit of between US$2.41-billion and US$2.51-billion was marginally below expectations of US$2.48-billion, according to data compiled by LSEG.
The company forecast gross bookings – or the total dollar value of rides, deliveries and other services – of between US$52.25-billion and US$53.75-billion for the fourth quarter. Analysts expect US$52-billion, according to data compiled by LSEG.
Uber will replace adjusted EBITDA with adjusted profit forecasts starting from its guidance for the first quarter of next year, adopting a practice typical of more mature firms.
Gross bookings in the third quarter ended Sept. 30 were US$49.74-billion, compared with estimates of US$48.73-billion. Revenue rose 20 per cent to US$13.47-billion, beating estimates of US$13.28-billion.