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Key Takeaways
- Uber stock fell sharply in premarket trading Wednesday following the release of first-quarter results.
- Revenue met estimates while gross bookings fell short, and $721 million in charges related to revaluations of Uber’s investments led the company to report a surprising net loss for the quarter.
- For the current quarter, gross bookings are projected to range between $38.75 billion to $40.25 billion, mostly below the $40.12 billion analysts are projecting.
Ridesharing giant Uber Technologies’ (UBER) shares sank in premarket trading Wednesday as the company released its first-quarter results. Revenue met estimates but gross bookings missed, and Uber posted a net loss after reporting hundreds of millions in charges related to revaluations of its investments.
Revenue Meets Expectations, Gross Bookings Miss, Revaluation of Investments Contributes to Net Loss
Uber reported $10.13 billion in revenue, crossing the $10 billion mark for the first time as analysts projected, on $37.65 billion in gross bookings through the platform, below expectations of $38.02 billion, according to estimates compiled by Visible Alpha.
Uber reported a net loss of $654 million, or 32 cents per share, when analysts were expecting profit of $477.2 million, or 22 cents per share. It posted a $721 million pre-tax headwind related to “net unrealized losses related to the revaluation of Uber’s equity investments,” the company said.
In the first quarter of 2023, Uber reported revenue of $8.82 billion on $31.4 billion in gross bookings, with a net loss of $157 million, or 8 cents per share.
For the current quarter, Uber projects gross bookings to fall between $38.75 billion to $40.25 billion, which would represent growth of 18% to 23% year-over-year on a constant-currency basis. Analysts are looking for $40.12 billion in gross bookings, according to Visible Alpha consensus.
| Q1 2024 Actuals | Analyst Estimates for Q1 2024 | Q1 2023 | |
| Revenue | $10.13 billion | $10.1 billion | $8.82 billion |
| Diluted Earnings Per Share / (Loss) | (32 cents) | 22 cents | (8 cents) |
| Net Income / (Loss) | ($654 million) | $477.2 million | ($157 million) |
Pre-Report News: Instacart Partnership, Analyst Thoughts
A day ahead of the report, Uber announced a partnership with grocery delivery app Instacart (CART) to bring Uber Eats restaurant delivery to the Instacart app “in the coming weeks” nationwide.
“Through this partnership, Instacart customers now have access to both the best online grocery selection in the U.S. and restaurant delivery, making it even easier for them to conveniently tackle all their food needs from a single app,” Instacart Chief Executive Officer (CEO) Fidji Simo said.
In the weeks leading up to the report, Jefferies analysts raised their target price for Uber stock to $100 from $95, writing that the company’s top line could benefit as consumers adopt new booking methods that have been released in recent months.
In an April 29 note, Bank of America analysts wrote that they would be looking for executives to answer questions about Uber’s plans to deal with the rise of autonomous vehicles through companies like Waymo and Tesla that could act as taxis and disrupt Uber’s business model. While the shift to autonomous vehicles will take years, the analysts wrote, events like Tesla’s planned robotaxi reveal currently scheduled for August could negatively impact Uber’s stock price.
Uber shares fell as much as 9% in the minutes after the report’s release, and recovered slightly to be down about 6% to $66.30 about 90 minutes before the opening bell.
Correction—May 8, 2024: This article has been updated to correct that Uber did not swing to a loss.