TechCentralTechCentral
    Facebook Twitter YouTube LinkedIn
    Facebook Twitter LinkedIn YouTube
    TechCentralTechCentral
    NEWSLETTER
    • News

      Fixing SA’s power crisis is not complex: it simply takes the will to do better

      12 August 2022

      Consortium makes unsolicited bid for state’s 40% stake in Telkom

      12 August 2022

      Actually, solar users should pay more to access the grid – here’s why

      12 August 2022

      Telkom says MTN talks remain on track

      12 August 2022

      Analysis | Rain muddies the waters with approach to Telkom

      11 August 2022
    • World

      Tencent woes mount, even after $560-billion selloff

      12 August 2022

      Huawei just booked its first sales rise since US blacklisting

      12 August 2022

      Apple remains upbeat about iPhone sales even as Android world suffers

      12 August 2022

      Ether at two-month high as upgrade to blockchain passes major test

      12 August 2022

      Gaming industry’s fortunes fade as pandemic ends

      11 August 2022
    • In-depth

      African unicorn Flutterwave battles fires on multiple fronts

      11 August 2022

      The length of Earth’s days has been increasing – and no one knows why

      7 August 2022

      As Facebook fades, the Mad Men of advertising stage a comeback

      2 August 2022

      Crypto breaks the rules. That’s the point

      27 July 2022

      E-mail scams are getting chillingly personal

      17 July 2022
    • Podcasts

      Qush on infosec: why prevention is always better than cure

      11 August 2022

      e4’s Adri Führi on encouraging more women into tech careers

      10 August 2022

      How South Africa can woo more women into tech

      4 August 2022

      Book and check-in via WhatsApp? FlySafair is on it

      28 July 2022

      Interview: Why Dell’s next-gen PowerEdge servers change the game

      28 July 2022
    • Opinion

      No reason South Africa should have a shortage of electricity: Ramaphosa

      11 July 2022

      Ntshavheni’s bias against the private sector

      8 July 2022

      South Africa can no longer rely on Eskom alone

      4 July 2022

      Has South Africa’s advertising industry lost its way?

      21 June 2022

      Rob Lith: What Icasa’s spectrum auction means for SA companies

      13 June 2022
    • Company Hubs
      • 1-grid
      • Altron Document Solutions
      • Amplitude
      • Atvance Intellect
      • Axiz
      • BOATech
      • CallMiner
      • Digital Generation
      • E4
      • ESET
      • Euphoria Telecom
      • IBM
      • Kyocera Document Solutions
      • Microsoft
      • Nutanix
      • One Trust
      • Pinnacle
      • Skybox Security
      • SkyWire
      • Tarsus on Demand
      • Videri Digital
      • Zendesk
    • Sections
      • Banking
      • Broadcasting and Media
      • Cloud computing
      • Consumer electronics
      • Cryptocurrencies
      • Education and skills
      • Energy
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Motoring and transport
      • Public sector
      • Science
      • Social media
      • Talent and leadership
      • Telecoms
    • Advertise
    TechCentralTechCentral
    Home»Sections»Motoring and transport»Uber reports disappointing user growth

    Uber reports disappointing user growth

    Motoring and transport By Agency Staff5 November 2019
    Facebook Twitter LinkedIn WhatsApp Telegram Email

    Uber Technologies disappointed investors with quarterly results showing lacklustre gains in bookings and monthly active users, two of the metrics most closely watched by Wall Street.

    The ride-hailing company beat estimates for quarterly revenue and loss, improved its annual loss forecast and pledged to turn a profit by 2021. Those weren’t enough to lift the stock, though. Shares were down about 5% in extended trading after the results.

    The San Francisco-based company is seeking to assure investors it can evolve from a ride-hailing service to a global all-in-one transportation platform. There could be more pressure on Uber shares on Wednesday, when a stock lock-up for a large swath of shareholders expires. An additional 1.5 billion shares could be eligible to trade according to Renaissance Capital, nearly doubling the total number outstanding. Of venture-backed companies, only Alibaba Group had a larger lock-up of 1.6 billion shares.

    Uber executives said the company would spend less aggressively and turn an adjusted profit in 2021

    While Uber’s overall results were good, uncertainty about the possibility of new shares flooding the market cast a shadow that may have depressed share price, said Ali Mogharabi, an analyst at Morningstar.

    “It may be people getting out now, thinking that after Wednesday it’ll drop,” he said.

    On a conference call with reporters following the report, Uber executives said the company would spend less aggressively and turn an adjusted profit in 2021. “We will be driving discipline across the company and only doing investments that we can afford,” said CEO Dara Khosrowshahi.

    The forecast echoed a commitment from Uber’s smaller rival, Lyft, which said it would be profitable by the fourth quarter of 2021, a year earlier than previously expected. Lyft, which focuses exclusively on transportation, blew past analysts’ third quarter estimates when it reported results last week.

    Job cuts

    Khosrowshahi has sought to rein in spending, slicing roughly 1 200 positions from sales and marketing, engineering and product. Like Lyft, Uber has also cut back on rider discounts and driver incentives in a bid to improve margins and narrow losses. Khosrowshahi said on the call that Uber would exit markets and dispose of assets where it was clear it could not command number one or number two positions within the next 18 months.

    Uber’s business strategy hinges on convincing existing ride-hailing customers to use more services, including bikes, scooters, helicopters and public transportation, as well as food and grocery delivery. Uber’s newer initiatives, including a job matching service for gig workers in Chicago and financial services for drivers, further demonstrate the company’s grand ambitions.

    Since going public in May, Uber investors have punished the company for its growth-at-all-costs strategy. The stock closed Monday at US$31.08, well below the $45 listing price.

    Although profitability may still be a couple years away, it’s earlier than analysts expected. Uber ended the third quarter with about $12.7-billion in cash, suggesting it can continue investing in growth where it doesn’t expect continued losses. Adjusted loss for the quarter widened to $585-million, compared to $485-million during the same period last year, but was still better than an average of analysts’ estimates of $808-million.

    Quarterly adjusted revenue increased 33% to $3.5-billion, above estimates of $3.39-billion. Uber revised its annual loss forecast to between $2.8-billion and $2.9-billion, an improvement of $250-million.

    It’ll need to do more to attract customers. Monthly active platform users, meaning those who ordered food or a ride one or more times during the quarter, was 103 million, up 26%. Analysts expected 107 million. Gross bookings, a measure of the total value of rides, food orders and other businesses, were $16.5-billion, compared to estimates of $16.7-billion. Food delivery was especially disappointing.

    More pricing pressure could come next year. California legislation designed to push Uber, Lyft, DoorDash and other gig-economy companies to reclassify independent contractors as employees goes into effect in January and could increase costs in the state by as much as 30%, according to analyst estimates. The three tech companies are gathering signatures now to challenge the law with a competing ballot initiative in a year.  — Reported by Lizette Chapman, with assistance from Ian King, (c) 2019 Bloomberg

    Dara Khosrowshahi Lyft Uber
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email
    Previous ArticleVoyager 2 reveals cosmic findings after reaching interstellar space
    Next Article New gov’t website to make it easier to register a business

    Related Posts

    Fixing SA’s power crisis is not complex: it simply takes the will to do better

    12 August 2022

    Consortium makes unsolicited bid for state’s 40% stake in Telkom

    12 August 2022

    Actually, solar users should pay more to access the grid – here’s why

    12 August 2022
    Add A Comment

    Comments are closed.

    Promoted

    Get your brand in front of TechCentral’s amazing audience

    12 August 2022

    Pricing Beyond CMYK: printers answer the FAQs

    11 August 2022

    How secure is your cloud?

    10 August 2022
    Opinion

    No reason South Africa should have a shortage of electricity: Ramaphosa

    11 July 2022

    Ntshavheni’s bias against the private sector

    8 July 2022

    South Africa can no longer rely on Eskom alone

    4 July 2022

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2022 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.