Wednesday, April 24, 2024
HomeBusinessUber Records Rare Profit Thanks to Stake in Didi

Uber Records Rare Profit Thanks to Stake in Didi


Uber is recovering from the pandemic and the driver shortages that followed, the company said on Wednesday. The company’s revenue in the second quarter grew 105 percent from the same period last year, to $3.9 billion, slightly higher than analysts expected. Uber also recorded a rare profit of $1.1 billion, thanks to the initial public offering of the Chinese ride-hailing company Didi, of which Uber owns an 11 percent stake.

Excluding that one-time gain, Uber said its adjusted losses were $509 million. Uber last recorded a profit in the first quarter of 2018, when it sold off parts of its businesses in overseas markets where it faced challenges. The company remains on track to reach its goal of adjusted profitability in the last three months of 2021, Nelson Chai, its chief financial officer, said in a statement.

Uber’s stock price fell about 8 percent in after hours trading, a result of the declining value of its Didi stake as that company faces regulatory pressure in China.

Uber and other ride-hailing companies still face uncertainty as the Delta variant causes a surge of Covid-19 cases in the United States and elsewhere. Uber’s food delivery business, Uber Eats, provided a lifeline to the company during earlier lockdowns, when customers stopped taking rides but started ordering more food.

Riders returned to Uber this spring more quickly than drivers, causing long wait times and higher prices. To tempt drivers back to the platform, Uber increased incentives and bonuses. Uber also said it temporarily had lowered the amount it takes from ride hail fares to 18.7 percent, from its usual rate of roughly 20 to 25 percent.

The move worked, according to Uber’s chief executive, Dara Khosrowshahi. “We invested in recovery by investing in drivers, and we made strong progress, with monthly active drivers and couriers in the U.S. increasing by nearly 420,000 from February to July,” Mr. Khosrowshahi said in a statement.

Uber said it attracted 101 million monthly active consumers.

On Tuesday, Lyft, Uber’s largest competitor in the United States, said it had revenue of $765 million in the second quarter, a 125 percent increase from the previous year. The company narrowed its losses to $251.9 million from $437.1 million and attracted 17 million active riders, a nearly 97 percent increase from the same period a year ago.

Lyft attributed the growth to its recovery from the peak of the pandemic and said that it had reached its goal of adjusted profitability.


Source link


Most Popular