Uber on track to hit profitability this quarter after decade-long journey
Uber has said it is on course to post its first-ever profit – on an adjusted basis – in the current quarter, beating expectations as food delivery continues to surge and ride hailing recovers from pandemic lows.
Shares in the company were up around 8 per cent in early trading today after the company projected that its adjusted earnings before tax (EBITDA) – the company’s preferred metric since its IPO two years ago – would break even in the third quarter, forecasting between a loss of $25m and a profit of $25m.
This is a surge of optimism compared with the company’s previous forecast of “better” than a $100m loss.
The company also said it was expecting a stronger fourth quarter, forecasting adjusted EBITDA between $0 and $100m.
“With positive adjusted ebitda in July and August, we believe Uber is now tracking towards adjusted ebitda break-even in Q3, well ahead of our prior guidance,” Uber’s chief financial officer Nelson Chai said in the company filing this morning.
Uber also forecast its gross bookings for July to September this year would come in at between $22.8bn and $23.2bn – slightly down from its previous forecast of between $22bn and $24 bn.
It comes after the ride-hailing giant has faced a double hit since the onset of the pandemic, as global lockdowns and now a shortage of drivers pushed down journey numbers.
Post-pandemic, the company is somewhat slimmed down after a range of cost-cutting measures, including laying off almost 7000 staff last year, closing offices in some locations and offloading its food delivery market in unprofitable markets.