What's going on?
Uber reported mixed results late on Thursday, but nothing’s going to rain on the ride-hailing giant’s first profitable (ish) quarter.
What does this mean?
Revelers and merry-makers of all kinds are finally back in action, and they’ve been hopping into Ubers to get wherever they need to go. And it shows: the company saw 39% more trips last quarter than the same time last year, and the total value of bookings was up 67%. Uber did so well, in fact, that it finally reported its first-ever quarterly profit.
Take that with a pinch of salt, mind you: the company’s investment in Chinese self-driving car company Didi has plummeted by $3.2 billion, even if it hasn’t realized those losses. A handful of salt, actually: Uber’s profit forecast for this quarter came in worse than expected, maybe because the company’s worried lockdowns are set to make a comeback.
Why should I care?
The bigger picture: Uber has some explaining to do.
Uber’s food delivery service was a gift last year: the drop-off in its ride-hailing segment was – at least in part – offset by Uber Eats, which nearly tripled its revenue last year versus the year before. But it’s still not profitable, even as the ride-hailing segment posted a profit of more than $500 million last quarter. And that won’t help placate impatient investors, who had already sent its stock down 11% this year before the announcement.
Zooming out: Big summer blowout.
Uber isn’t the only “sharing economy” firm to fret about lockdowns: Airbnb previously warned that this summer – usually the busiest time for the vacation rental giant – might be a quiet one. What it didn’t anticipate was that the working-from-home trend would allow vacationers to mix business with pleasure, taking longer and more frequent trips. That helped push its profit up by a massive 280% compared to last year, which might be why investors initially sent its stock up 3%.