Uber reports quarterly results: Shares fall in after-hours

 Uber reports quarterly results: Shares fall in after-hours

Uber (UBER) posted its first-ever adjusted profit, but its Q4 outlook weighed on shares immediately following the ride-sharing company’s third quarter results.

Uber reported third quarter revenue of $4.85 billion versus Wall Street estimates of $4.4 billion. Gross bookings reaching an all-time high of $23.1 billion, up 57% year over year.

The company reported its first adjusted EBITDA profit of $8 million for the quarter.

“While we recognize it’s just a step, reaching total-company Adjusted EBITDA profitability is an important milestone for Uber,” CFO Nelson Chai said in the earnings release. 

The company’s fourth quarter EBITDA outlook though came in below expectations. Uber expects an adjusted EBITDA of $25 million – $75 million versus Wall Street estimates of $98 million.

The company’s net loss of $2.4 billion was weighed by its investment in Didi (DIDI). Uber citied an unrealized loss of $3.2 billion (pre-tax) related to the revaluation of its equity investment in the Chinese ride-hailing business. Didi’s stock has tanked earlier this year amid regulatory crackdowns in China. 

Net loss attributable to Uber Technologies, Inc. was $2.4 billion, which includes a $2.0 billion net headwind (pre-tax) from revaluation of Uber’s equity investments, primarily due to an unrealized loss of $3.2 billion (pre-tax) related to the revaluation of Uber’s Didi equity investment, partially offset by aggregate unrealized gains related to the revaluation of Uber’s Zomato, Aurora, and Joby stakes. Additionally, net loss includes $281 million in stock-based compensation expense.

“Our early and decisive investments in driver growth are still paying dividends, with drivers steadily returning to the platform, leading to further improvement in the consumer experience,” said Dara Khosrowshahi, CEO of Uber.

Over the summer, Uber’s second-quarter results beat analysts’ expectations on gross bookings, but the company saw steeper adjusted EBITDA losses than expected.

The company recently announced that Hertz Global (HTZZ) will make up to 50,000 Tesla (TSLA) electric vehicles available to Uber drivers in select markets who want to rent the cars by 2023. Hertz has already been working with Uber offering car rentals the past five years. The Tesla program will roll out nationally in the coming months. 

Uber has also invested around $400 million in Aurora (AUR), an autonomous driving hardware and software company which went public on the Nasdaq (^IXIC) on Thursday via a merger with a blank check company. 

Uber shares were up on Wednesday following competitor Lyft’s (LYFT) better-than-expected quarter, with an adjusted profit of of $67.3 million.

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