Uber (UBER) Q1 Loss Narrower than Expected, Revenues Beat
Shares of Uber Technologies UBER are currently trading well below its IPO price of $45. Notably, the San Francisco-based ride-hailing giant went public last month.
Recently, the company reported first-quarter 2019 results, wherein it incurred narrower-than-expected loss. Uber’s first-quarter loss of $2.26 per share compared favorably with the Zacks Consensus Estimate of a loss of $2.32 per share. Meanwhile, revenues improved 20% year over year to $3,099 million and also surpassed the Zacks Consensus Estimate of $3,073.7 million.
Uber reports through two segments — Core Platforms and Other Bets. While the Core Platforms includes the company’s core business ridesharing apart from its food delivery business — Uber Eats, the Other Bets segment comprises freight, its logistics platform, among other things.
In the first quarter, majority of the company’s revenues (98.5%) came from Core Platforms. Within the Core Platforms unit, ridesharing revenues increased 9% to $2,376 million, with gross bookings increasing 22%. Uber Eats revenues jumped 89% to $536 million, with gross bookings doubling.
Ride-sharing revenues grew 26% in the United States and Canada to $1,750 million and 26% in Europe, the Middle East and Africa to $487 million. While ride-hailing revenues increased 6% in the Asia Pacific region to $267 million, the same fell 13% in Latin America to $450 million.
At the Core Platforms segment gross bookings increased 34% while the measure surged in excess of 200% at the company’s Other Bets segment. In the quarter, total gross bookings increased 34% to $14.65 billion. Monthly active platform customers grew 33% to 93 million in the same period.
Additionally, cost of revenues (excluding depreciation and amortization) at Uber, which competes primarily with Lyft LYFT in the ride hailing market, increased primarily due to higher driver incentives. In fact, Uber is also spending significantly on promotions and driver incentives in a bid to gain a market share similar to Lyft.
Uber, carrying a Zacks Rank #3 (Hold), exited the first quarter with cash and cash equivalents of $5,745 million compared with $6,406 million at the end of 2018. Long-term debt, net of current portion, at the end of the quarter stood at $6,939 million compared with $6,869 million at 2018 end.
Key Picks
Better-ranked stocks in the Business Services sector are Navigant Consulting NCI and WEX WEX. While Navigant Consulting sports a Zacks Rank #1 (Strong Buy), WEX is a Zacks Rank #2 (Buy) stock. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term expected EPS (three to five years) growth rate for Navigant Consulting and WEX is 13.5% and 15%, respectively.
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