Uber narrows quarterly loss as bookings surge
Uber Technologies Inc today reported a 16 percent increase in quarterly bookings and a smaller loss than the previous period as the ride-services company showed signs of inching toward profitability.
The shrinking losses reflect Uber’s efforts to rein in massive spending on subsidies for both drivers and customers even as it battles rivals in tough markets like South Asia and Nigeria where Taxify is posing a great threat to Uber’s market leadership.
Despite the difficulties, Uber’s gross bookings double year-over-year. The figure was also up 17% on the previous quarter. But despite the big growth in revenue, company’s losses remained high: at $645m, they were down 9% on the previous quarter and down 14% year-on-year.
The number of trips taken in the quarter was up 150% on a year ago, while in developing markets – excluding China, which Uber pulled out of last year – they rose 250%.
The fact that the number of trips made is growing more quickly than the total value of bookings means that the cost of the average trip has fallen in the last year.
The continued growth in ridership suggests Uber’s core business has so far weathered a string of scandals. But the scale of its losses are unprecedented in Silicon Valley and executives have declined to offer a timetable for profitability.
Uber is facing allegations of sexual harassment, a lawsuit alleging trade-secrets theft and a federal criminal probe over its use of software to evade city regulators, among other alleged misconduct.
Some investors have eyed Uber’s $68 billion valuation with skepticism, and four mutual fund investors disclosed this week that they had marked down the value of their Uber shares by as much as 15 percent.
Uber said its gross ride bookings for the second quarter reached $8.7 billion, up from $7.5 billion in the first quarter. The number of global trips on its service increased 150 percent over the previous year, with growth strongest in developing markets.
Those numbers include trips in Russia, where Uber last month merged its operations with local rival Yandex. Adjusted net revenue, which reflects Uber’s cut of ride fares, rose to $1.75 billion from $1.5 billion in the first quarter, Uber said.
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