Uber's Q4 profit drops 33% despite surge in sales

Company’s net income stood at $595m in three months to December 31

Uber’s revenue in the last quarter soared 49 per cent on an annual basis to more than $8.6 billion. AP

Ride-hailing company Uber reported a more than 33 per cent drop in its fourth-quarter net profit despite an increase in gross bookings and overall sales.

The California-based company’s net income stood at $595 million. It included a $756 million net benefit (pre-tax) primarily due to unrealised net gains related to the revaluation of the company’s equity investments, Uber said in a statement. It reported a net loss of more than $1.2 billion in the third quarter of last year.

Uber’s fourth-quarter revenue rose 49 per cent on an annual basis to more than $8.6 billion, exceeding analysts’ expectations of $8.4 billion.

The company also crossed 2 billion trips in a single quarter for the first time — an average of nearly 1 million trips per hour or almost 23 million trips per day. Trips on Uber’s platform grew 8 per cent quarterly and 19 per cent on an annual basis to 2.1 billion in the fourth quarter.

The monthly active platform consumers reached 131 million in the previous quarter, up 11 per cent annually.

Uber stock surged 7.5 per cent to trade at $34.90 a share in pre-market trading.

“We ended 2022 with our strongest quarter ever, with robust demand and record margins,” said Dara Khosrowshahi, Uber's chief executive.

“Our global scale and unique platform advantages position us well to accelerate this momentum into 2023 … the pandemic’s impact on our mobility business is now well and truly behind us,” Mr Khosrowshahi said.

The company’s gross bookings surged 19 per cent year-on-year to more than $30.7 billion in the fourth quarter. It was more than 5.6 per cent up on a quarterly basis.

Delivery gross bookings increased 6 per cent during the October-December period to $14.3 billion and mobility bookings surged 31 per cent to $14.8 billion.

Freight — essentially the Uber for trucking — bookings jumped 42 per cent yearly to more than $1.5 billion.

The company said the unrestricted cash, cash equivalents and short-term investments were $4.3 billion as of December 31.

​​​​​​​​​​​​​​​​​​​​​​​​Revenue in the US and Canada jumped almost 38 per cent yearly to about $4.9 billion in the past quarter. It constituted nearly 58 per cent of the company’s total sales.

Revenues jumped 31 per cent annually to $547 million in Latin America and 110 per cent in Europe, the Middle East and Africa to more than $2 billion.

It also increased about 32 per cent to $992 million in the Asia-Pacific region.

The company reported an adjusted income of $665 million before interest, tax and other expenses in the three months to end of December. That was $579 million improvement from the same period in 2021.

“In 2022, we significantly exceeded our profitability outlook, with an incremental margin of 10 per cent,” said Nelson Chai, Uber’s chief financial officer.

“Our outlook for gross bookings and adjusted ebitda [earnings before interest, taxes, depreciation, and amortisation] step up in the first quarter builds on that progress, and sets us up for yet another record year,” Mr Chai said.

In its first quarter outlook, the company expects gross bookings to grow in the range of 20 per cent to 24 per cent on an annual basis. It expects its adjusted income to range between $660 million and $700 million.

The company spent more than $747 million on research and development, about 8.5 per cent of its total sales in the quarter. This is 33.8 per cent more than what was spent on research and development in the same period in 2021.

In the last quarter, Uber and Boston-based Motional announced a public driverless taxi service in Las Vegas. It marked the first-time public riders can access a Motional autonomous vehicle on Uber’s network. This service comes after a successful launch of autonomous deliveries with Uber Eats in Greater Los Angeles.