Uber’s financial forecast for this quarter was disappointing, and its stock price fell nearly 9% before the opening bell.

Uber announced its financial results for the first quarter of fiscal year 2024 before the U.S. stock market opened on Wednesday (8th). Although the revenue for the quarter was slightly higher than Wall Street analysts expected, the total bookings during the period were not only lower than the company\’s previous expectations, but also lower than market forecasts. Coupled with the bleak forecast for total bookings for this quarter (second quarter), the stock price plummeted nearly 9% before the market opened.

Uber announced its financial results for the first quarter of fiscal year 2024 on Wednesday (8th) before the U.S. stock market opened. Although the revenue for the quarter was slightly higher than Wall Street analysts expected, the total bookings during the period were not only lower than the company\’s previous expectations, but also lower than market forecasts. In addition, this quarter\’s revenue was slightly higher than Wall Street analysts\’ expectations. (Second quarter) Gross bookings forecast was bleak. Shares plummeted nearly 9% in premarket.
At the time of writing, Uber\’s (UBER-US) stock price fell 8.99% before the market opened on Wednesday, temporarily trading at $64.10 per share.
Looking ahead, Uber estimates that this quarter’s bookings (ride-hailing services, delivery orders, and driver and merchant revenue but excluding tips) range from $38.75 billion to $40.25 billion, lower than LSEG analysts’ forecast of $40.04 billion, adjusted Earnings before interest, taxes, depreciation and amortization (EBITDA) ranged from $1.45 billion to $1.53 billion, with the midpoint of $1.49 billion higher than market expectations of $1.47 billion.
The company estimates currency rates will have an adverse impact on year-over-year booking growth for the quarter by 3 percentage points and 5 percentage points on its mobile business.
According to Uber\’s first quarter (as of March 31) revenue increased by 15% year-on-year to US$10.13 billion, slightly higher than analysts\’ expectations of US$10.11 billion, and adjusted EBITDA increased by 82% from the same period last year to US$1.38 billion, slightly higher than the US$10.11 billion expected by analysts. Analysts expected a net loss of US$1.32 billion, a net loss of US$654 million, or a loss of US$0.32 per share, far lower than analysts\’ estimates of a profit of US$0.23 per share in the same period last year, a loss of US$157 million, or a loss of US$0.08 per share.
It’s worth noting that the company’s first-quarter gross bookings rose 20% annually to $37.7 billion, but that was still below the median forecast it provided in February and short of analysts’ estimates of $38 billion.
Picture: Uber’s response. Uber Chief Financial Officer Prashanth Mahendra-Rajah attributed the poor booking performance in the first quarter to the weakness of the ride-hailing business in Latin America, and the return of last year’s Brazilian Carnival became the driving force behind the surge in bookings.
Other analysts pointed out that the lower-than-expected performance of bookings in the last quarter was dragged down by the weakness of Uber Eats, the company’s food delivery arm.
Specifically, in the first quarter, Uber’s ride-hailing business revenue grew 30% higher than analysts’ expectations, while its food delivery unit’s revenue only grew 4%, lower than analysts’ expectations.
Uber Chief Executive Dara Khosrowshahi said growth in ride-hailing last quarter was driven by longer commutes to airports and offices, while delivery business benefited from new users and higher order frequency.
Although last quarter\’s results were mixed, he still said the results demonstrated the company\’s ability to achieve sustained and profitable large-scale growth.
Market analysts believe that the strength of Uber\’s ride-sharing and food delivery business in the United States has been questioned because competitors including Lyft (LYFT-US) and DoorDash (DASH-US) exceeded Wall Street analysts\’ expectations last quarter.
Since Uber hit a profitability milestone last year, investors have increasingly focused on whether the company can sustain double-digit growth through the launch of new products, rather than focusing on its profit performance.
In the coming weeks, Uber will integrate the Uber Eats interface into the Instacart app to accommodate restaurant orders placed by customers on Instacart as part of a partnership announced Tuesday.
Khosrowshahi said the company will pursue similar partnerships to further leverage the technology.
In addition, due to industry-wide headwinds, Uber\’s freight business is still a laggard, but the decline in bookings in this department has slowed compared with previous quarters.

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