Ride-hailing major Uber has reported its earnings for the first quarter on Wednesday – despite surpassing analyst expectations on earnings per share, the company fell short of revenue and gross bookings estimates, indicating potential headwinds ahead. The firm reported a net income of $1.78 billion, or 83 cents per share — well above analyst predictions of 51 cents, while its overall revenue of $11.53 billion and total gross bookings of $42.8 billion missed projections, which were forecasted at $11.62 billion and $43.1 billion respectively.
“We kicked off the year with yet another quarter of profitable growth at scale, with trips up 18% and even stronger user retention,” Uber CEO Dara Khosrowshahi commented on the matter. “Supported by the consistent strength of our core business, we continue to build towards the future, including five new autonomous vehicle announcements in just the last week.” The firm’s stocks are currently priced at $84.22/share, marking a drop of 1.89%.
For the three months ended March 31, he company’s mobility segment, which includes its flagship ride-hailing service, grew by 13% to $21.18 billion in gross bookings, while the number of trips rose by 18% on an annual basis to 3 billion and the number of active customers on a monthly basis rose by 14% annually. While that represents a decent year-over-year growth, it also marks the slowest expansion rate since the height of the pandemic. External disruptions, such as severe winter weather and wildfires in California, were cited as contributing factors. Additionally, ride prices have risen in several markets due to surging insurance costs—an expense Uber has passed along to riders. Even when adjusted for currency fluctuations, rideshare bookings showed deceleration, slipping to 20% growth in Q1 compared to 24% in the previous quarter.
Uber’s delivery unit, which includes Uber Eats and grocery services, continued to perform well, with gross bookings rising 15% to $20.38 billion. The business segment’s growth was in line with analyst forecasts and provided some cushion to Uber’s overall results. Despite this, the strength in deliveries wasn’t enough to counterbalance the mobility segment’s shortfall. Uber maintains that transportation and food delivery are largely “recession-resistant” categories. Khosrowshahi reiterated this during the earnings call, stating, “The categories we operate in… tend to be categories that are quite consistent, even during periods of macro uncertainty.”
The broader economic climate is not helping things either, and consumer sentiment in the US dipped during the quarter, with March marking a four-year low amid persistent inflation concerns and volatile trade policies under the Trump administration. Uber is not alone in marking a recent dip, and other companies in the travel and mobility sector, such as Airbnb, have also flagged declining the demand for travel in the US.
For now, Uber is presenting an optimistic forecast for the second quarter. The company projects gross bookings to reach between $45.75-47.25 billion, with the midpoint surpassing Wall Street’s expectations of $45.8 billion. It also expects adjusted EBITDA to fall between $2.02-2.12 billion, up from $1.87 billion in the first quarter. To offset domestic stagnation, Uber is doubling down on international markets – yesterday, it revealed the acquisition of an 85% stake in Turkish food and grocery delivery service Trendyol Go for $700 million, alongside more recent partnerships with Pony AI and Waymo.
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