Tuesday , June 22 2021

Uber reports $ 1 billion in losses in the quarter as the growth in booking slowed

Uber Technologies announced on Wednesday that over the past quarter, the third quarter in a row, the increase in travel and supply reservations has increased by 6 percent, and this increase has remained in one-digit figures after double-digit growth last year.

The San Francisco based company dropped by $ 1.07 billion (approx. 7,700 kronor) over the three months ended September 30, which is 20% more than in the previous quarter but decreased by 27% compared with the previous year when the company published the largest quarterly publicly announced Uber co-founder and former CEO, Travis Kalanick, on heels.

Uber is striving to expand freight transportation, food supplies and electric bikes and scooters, as growth is now a ten-year-old ride-hailing business dwindles. A company valued at USD 76 billion (approximately 5.48 million Lakh crores) is under pressure to show that it can still grow sufficiently to become profitable and meet investors in the initial public offering planned for some time next year .

Its adjusted loss before interest, taxes, depreciation and amortization was USD 592 million (approximately EEK 4270), from USD 614 million (approximately 4 400 kroes) and USD 1.02 billion (approximately EEK 7,400) from the previous year.

"We had another strong quarter for our size and global business," said Nelson Chay, Uber's Chief Financial Officer, who joined in September after the job was vacant for three years. He highlighted "a huge potential market in India and the Middle East, where we continue to strengthen our leadership."

However, wider economic conditions and prolonged losses could encourage Uber to unite with rivals in India and the Middle East, in particular because Ola, founded in Ura and India, is investing in SoftBank Group Corp

The Ubera's gross reservation was USD 12.7 billion (approximately EEK 91,600), which is 6 per cent more than in the previous quarter and by 41 per cent more than in the previous year. At the end of 2016, Uber's monthly booking grew at 30 percent, and at the beginning of 2017 it continued to increase by two-digit increase over the quarter. However, at the beginning of this year, booking increased only in one digit.

The quarterly revenue was US $ 2.95 billion (approximately EEK 21,300), a 5% increase over the previous quarter and a 38% increase year-on-year. The last quarter's profit increased by 63 percent.

As a private company, Uber is not required to publish financial information, but last year began to skip selected figures.

Bets on scooters, bikes and lorries
Since General Director Dara Khosrowshahi took over the leadership more than a year ago, Uber retreated from foreign markets where it suffered heavy losses and closed with some expensive companies, including drivers. However, Khosrowshahi has accumulated savings in its freight transport, food supply and electric scooter and bicycle business.

Softbank's investment, which was closed in January, which granted Ueber 15% to a Japanese investor, included a provision requiring Uber to submit an IPO by 30 September of the following year, or the company should be allowed to restrict the transfer of shareholders' shares to expire. This could create confusion with Uber's ownership structure and the value of equity and create regulatory problems.

According to sources familiar with the issue, Uber is considering the possibility of transferring its public debut from second half of 2019 to the first half of the year, due to concerns about the market downturn and anticipated IPO from its main US rival Lyft Inc.

Khosrowshahi has focused on growing Uber Eats, which has received a $ 2.1bn reserve in revenue that marked a 150 percent jump last year and about 17 percent of all orders.

Uber is also committed to double its investment next year in Freight, a brokerage service established in May 2017, for truck drivers and fleet managers looking for freight. Every quarter, the company doubles the number of loads it connects to trucks, Uber said.

But it's still unclear if one of the companies can make a profit. It is also unclear how Uber will pay for changes in the global food supply industry and whether its freight transport business will be used extensively by fleet managers.

© Thomson Reuters 2018

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