Uber Technologies (UBER) -) posted a surprise second quarter profit Tuesday, its first as a public company, and forecast solid near-term gains amid the broader travel boom and normalizing return-to-office working patterns.
Shares slumped lower, however, after CEO Dara Khosrowshahi cautioned that ride-sharing rival Lyft (LYFT) -), a "tough competitor" is starting to become "competitive in pricing" in the U.S. market.
Uber said revenue for the three months ended in June rose 14.4% from a year earlier to $9.23 billion, narrowly inside Wall Street forecasts of a $9.29 billion tally, as gross bookings rose 16% to $33.6 billion. Rides revenue rose 25% to $16.73 billion, Uber said, while delivery rose 12% to $13.88 billion.
Uber's net income for the quarter were $394 million while adjusted earnings were pegged at 18 cents per share, up from the year-earlier loss of $1.33 per share. Uber said its operating profit of $326 million, on a non-GAAP basis, was the first in the company's history.
Looking into the current quarter, Uber said it sees adjusted earnings in the region of $975 million to $1.025 billion, firmly ahead of forecasts, with gross bookings in the region of $34 billion to $35 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,” said CEO Dara Khosrowshahi. “These results also translated into strong driver and courier engagement, with 6 million drivers and couriers earning a record $15.1 billion during the quarter.”
Uber shares were marked 5.84% lower in early afternoon trading Tuesday to change hands at $46.62 each.
The group also said CFO Nelson Chai would leave the company early next year, adding it would begin searching for a replacement prior to his January 5 departure.
“The unique power of the Uber platform and the team’s relentless focus on profitable growth was on full display in Q2, with record profitability and over $1 billion of quarterly free cash flow,” Chai said. “I’m incredibly proud of the progress we’ve made, and Uber is well positioned to drive tremendous value for shareholders in the coming years.”
- Action Alerts PLUS offers expert portfolio guidance to help you make informed investing decisions. Sign up now.
