Uber Reports First Annual Profit in 14 Years, Beating Analyst Estimates
Uber has reported its first annual profit in 14 years of operation, according to its Q4 2023 financial results. The ride-hailing giant surpassed analyst expectations for earnings per share (EPS) by 50 cents, with revenues increasing by 15.4% year-over-year (YoY) to reach $9.4 billion.
One notable driver of growth for Uber was its gross bookings, which rose by 21% YoY in constant currency to $37.6 billion. Within this, Mobility Gross Bookings increased by 28% YoY to $19.3 billion, while Delivery Gross Bookings grew by 17% YoY to reach $17 billion. The total number of trips taken also saw a significant increase, rising by 24% YoY to 2.6 billion.
While these figures demonstrate Uber’s success in achieving profitability, there are concerns regarding a deceleration in growth. Specifically, Uber’s sequential Mobility Bookings decreased from 30% to 28% in Q4 2023. This trend is reminiscent of other tech companies such as Alphabet, whose declining revenue growth in certain segments has caused unease among investors.
Despite these concerns, Uber remains optimistic about its future prospects. The company projects Gross Bookings for Q1 2024 to range between $37 billion and $38.5 billion, indicating a 20% YoY growth. Additionally, Uber expects its adjusted EBITDA to fall between $1.26 billion and $1.34 billion for the same period.
Dara Khosrowshahi, Uber’s CEO, expressed his satisfaction with the company’s performance in 2023, hailing it as an inflection point in demonstrating Uber’s ability to achieve strong, profitable growth at scale. Khosrowshahi pointed to the company’s engaged audience and the average of nearly 26 million daily trips taken in the past year as evidence of its success.
Analysts have generally reacted positively to Uber’s Q4 2023 results. Firms like Needham have reiterated their Buy rating on Uber while raising the price target, citing the company’s strong performance and optimistic guidance for the upcoming quarter.
Overall, Uber’s financial results for 2023 indicate a significant milestone for the company, as it reports its first annual profit since its inception. While concerns about growth deceleration linger, Uber’s CEO remains confident in the company’s ability to deliver profitable growth in the future.
Analyst comment
Positive news – Uber has reported its first annual profit in 14 years and exceeded analyst estimates for earnings per share. The company experienced growth in gross bookings, with total trips taken increasing by 24% year-over-year. Despite concerns about a potential decline in growth, Uber remains optimistic about its future prospects and projects a 20% year-over-year growth in Gross Bookings for Q1 2024. Analysts have responded positively to Uber’s results, reiterating their Buy rating and raising the price target. This indicates a significant milestone for the company and showcases its ability to achieve profitable growth.