Uber shares surge as company says consumers still strong

Shares of Uber rocketed higher Tuesday after it reported a surge in quarterly revenue and described consumer demand as remaining robust.

The ride-hailing service scored a 72 percent jump in third-quarter revenues to $8.3 billion, thanks in part to the benefit of an acquisition in Uber’s freight business.

The company reported a $1.2 billion loss, citing a hit to Uber’s equity investments and the effect of stock-based compensation expense.

Despite inflation and other macroeconomic headwinds, Chief Executive Dara Khosrowshahi described Uber’s core business as “stronger than ever” in light of the loosening of Covid-19 restrictions, according to an earnings release.

Later, on a conference call with Wall Street analysts, Khosrowshahi said consumer spending was broadly strong, including for rides and in the company’s restaurant delivery service.

“Right now frankly we’re not seeing any signs of consumer weakness,” he said. “Even lower income riders continue to have higher trips per rider as things are opening up, showing absolutely no signs of slowing down.”

Khosrowshahi said the biggest drag on the business came from the strong dollar.

Uber offered an upbeat projection on the fourth quarter, forecasting gross bookings to rise 23 to 27 percent, with an operating profit estimate that topped analyst expectations.

Shares jumped 15.5 percent to $30.66 in morning trading.

© 2022 AFP