Uber’s record bookings fail to impress, stock weighted by outlook
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The news: Uber reported an 18% rise in fourth-quarter gross bookings last year to a record USD44.2 billion, surpassing analyst expectations of USD43.5 billion.
But the results failed to lift investor confidence, with shares falling as much as 8.75% after the company forecast lower-than-expected first-quarter growth for the current year.
The numbers: 1Q gross bookings are forecast between USD42 billion and USD43.5 billion, compared to consensus expectations for USD43.5 billion, according to Visible Alpha. Uber cited currency headwinds and extreme weather as factors impacting trips and deliveries.
Operating profit during 4Q 2024 rose 18% year-on-year to USD770 million but was weighed down by a USD462 million legal reserve. Net income surged to USD6.88 billion, primarily due to a tax valuation release.
The quarter marked Uber’s second consecutive annual operating profit, reaching USD2.8 billion.
Shares fell as much as 8.75% to USD63.65 each.
The context: Uber is balancing growth with challenges in autonomous vehicle competition, regulatory scrutiny and insurance costs.
The company said it had teamed up with rival Waymo, Alphabet’s self-driving taxi unit, to offer self-driving rides in Austin, charging customers the same price as a human-driven vehicle. It planned to launch in Atlanta later this year.
The US market is expected to be fiercely competitive, with Elon Musk’s Tesla due to begin trials of its autonomous Cybercabs in June.
Last month, Uber also said it had signed an exclusive, multiyear deal with Delta Air Lines, replacing Lyft’s previous agreement. Under this deal, Uber riders can now earn Delta SkyMiles on their trips.
Uber is facing an antitrust probe by the US Federal Trade Commission into driver pay coordination and a Colorado law mandating fare transparency.
The company is also facing high insurance costs in the US, which it is passing onto consumers while pushing for reform.
CEO Dara Khosrowshahi said Uber has made “significant progress” in slowing insurance price increases through technology and policy efforts but will continue to raise UberX fares “marginally” in the US in 2025. He has also pledged to push for insurance and tort reform to address the issue.
What they said: Khosrowshahi said he was “more confident than ever that Uber is uniquely positioned to capture the USD1 trillion-plus opportunity” tied to autonomous vehicles.
“Our performance has been powered by rapid innovation and execution across multiple priorities, including the massive opportunity presented by autonomous vehicles. We enter 2025 with clear momentum and will continue to be relentless against our long-term strategy.”
The source: Uber release
