- The headline beat masked weakness in the core. Uber reported third-quarter revenue of $14.77 billion, up 10% from a year earlier and above the $14.69 billion LSEG estimate, but earnings of 25 cents a share fell well short of the 96 cents expected. Net income dropped 92% to $512 million against a year-earlier quarter that included a $4.9 billion tax valuation benefit.
- Both main units missed. Mobility revenue fell 2% to $7.52 billion, below the $7.71 billion StreetAccount estimate, and delivery revenue rose 23% to $5.49 billion, just under the $5.51 billion forecast. Total bookings of $59.82 billion were in line with the $59.83 billion estimate.
- Freight did the heavy lifting. Freight sales jumped 34% to $1.76 billion, beating the $1.49 billion consensus by about $270 million by our calculation and driving the revenue beat.
- Costs overseas are biting. CEO Dara Khosrowshahi said “elevated fuel prices and tighter driver availability weighed on supply growth in several international markets,” and that Uber is making “targeted investments to strengthen driver supply.”
What Happened?
Uber reported third-quarter results on Wednesday showing revenue above estimates but misses in its ride-hailing and food delivery businesses. Khosrowshahi said in prepared remarks that mobility performed slightly below expectations overseas. Uber guided fourth-quarter gross bookings to $64.5 billion at the midpoint, in line with the $64.26 billion StreetAccount estimate. The company plans to have more than 2,000 autonomous vehicles on its platform by the end of 2027, half in the US, and around 700 by the end of this year, adding Amazon’s Zoox and Motional robotaxis in Las Vegas this quarter.
Why It Matters?
Mobility is Uber’s profit engine, so a revenue decline there is a bigger concern than the freight-driven beat suggests. Higher fuel prices are making driving less attractive and limiting supply, which can push up prices and slow trip growth. Delivery remains a growth driver, helped by acquisitions of Delivery Hero in Germany and ezCater in the US and an expanded Costco partnership that Khosrowshahi said is “tracking ahead of expectations.” The autonomous rollout is the long-term bet, though not everyone is convinced: on autonomous driving, Ross Gerber said in a CNBC interview, “I think Uber is cooked.”
What’s Next?
Investors will watch whether driver supply improves as Uber invests to attract drivers and whether fuel costs ease. Fourth-quarter bookings of about $64.5 billion are the near-term bar. Progress toward 2,000 autonomous vehicles, and how partners like Zoox and Motional perform on the platform, will shape the longer-term story.
Affected Tickers and Coins: UBER, AMZN, COST
Source: CNBC
