Uber posts $1 billion loss in quarter as growth in bookings slows
Uber posts $1 billion loss in quarter as growth in
bookings slows
By Heather Somerville Reuters November 14, 2018
SAN FRANCISCO (Reuters) - Uber Technologies Inc said on
Wednesday that growth in bookings for its ride-hailing and delivery services
rose 6 percent in the latest quarter, the third quarter in a row that growth
has remained in the single digits after double-digit growth for all of last
year.
The San Francisco-based firm lost $1.07 billion for the
three months ending Sept. 30, a 20 percent increase from the previous quarter
but down 27 percent from a year ago, when the company posted its biggest
publicly reported quarterly loss on the heels of the departure of Uber
co-founder and former Chief Executive Travis Kalanick.
Uber is seeking to expand in freight hauling, food
delivery and electric bikes and scooters as growth in its now decade-old
ride-hailing business dwindles. The company, valued at $76 billion, faces
pressure to show it can still grow enough to become profitable and satisfy
investors in an initial public offering planned for some time next year.
Its adjusted loss before interest, taxes, depreciation
and amortization was $592 million, down from $614 million last quarter and
$1.02 billion a year ago.
"We had another strong quarter for a business of our
size and global scope," said Nelson Chai, Uber's chief financial officer,
who joined in September after the job had been vacant for three years. He
emphasized the "high-potential markets in India and the Middle East where
we continue to solidify our leadership position."
Broader economic conditions and sustained losses could
also push Uber to merge with rivals in India and the Middle East, particularly
as Uber and India-based Ola share an investor in SoftBank Group Corp.
Uber's gross bookings were $12.7 billion, up 6 percent
from the previous quarter and up 41 percent from a year ago. In late 2016,
Uber's quarterly bookings growth approached 30 percent, and in early 2017 it
still sustained double-digit growth quarter-over-quarter. At the start of this
year, however, bookings growth slid into the single digits.
As a private company, Uber is not required to publicly
disclose financials, but last year started releasing selected figures.
Since CEO Dara Khosrowshahi took the helm than a year
ago, Uber has retreated from foreign markets where it had suffered heavy losses
and shuttered certain pricey ventures including self-driving trucks. But
Khosrowshahi has plowed the savings back into its freight-hauling,
food-delivery, and electric scooter and bikes businesses.
An investment by SoftBank that closed in January, which
gave the Japanese investor a 15 percent stake in Uber, included a provision
that requires Uber to file for an IPO by Sept. 30 of next year, or the company
risks allowing restrictions on shareholder stock transfers to expire. That
could create a mess for Uber's ownership structure and equity value, and pose
regulatory problems.
Uber is considering moving its public debut up from the
second half of 2019 to the first half, given concerns about a market downturn
and an expected IPO from its chief U.S. rival, Lyft Inc, according to sources
familiar with the matter.
Khosrowshahi has focused on growing Uber Eats, which took
in $2.1 billion in booking revenue, marking a 150 percent jump over last year
and about 17 percent of total bookings.
Uber has also pledged to double its investment over the
next year in Freight, a brokerage service set up in May 2017 for truck drivers
and fleet managers looking for cargo to haul. The business is doubling the
number of loads it connects with truckers every quarter, Uber said.
But it is not yet clear whether either business can
sustain a profit. It is also unclear how Uber will fare in a shakeout in the
crowded global food-delivery industry, and whether its freight business will be
widely adopted by fleet managers.
(Reporting by Heather Somerville; Editing by Lisa
Shumaker)
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