Uber reports $3 billion loss as coronavirus slams ride-hailing

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Uber reported a quarterly loss of nearly $3 billion on Thursday, it’s biggest in three quarters as the coronavirus pandemic squeezes its ride hailing business.

The stock dipped slightly in late trading on the massive loss before rising more than 6 percent after CEO Dara Khosrowshahi said there are reassuring signs in markets hit badly by the pandemic.

“Along with the surge in food delivery, we are encouraged by the early signs we are seeing in markets that are beginning to open back up,” he said in a statement.

Excluding a $2.1 billion write down that Uber took on its minority investments a few weeks ago, the company reported a loss of 64 cents per share, compared with Wall Street’s forecasted 88-cent loss.

Uber beat on gross bookings, reporting $15.8 billion versus the $15.3 billion analysts had expected.

CFO Nelson Chai, meanwhile, said that the company has “ample liquidity” to give it “flexibility to navigate the current crisis.”

Uber delivered its earnings just a day after announcing that it would shed nearly 15 percent of its workforce due to the coronavirus’ impact on its business. The cuts will see the company lay off 3,700 of its nearly 27,000 employees. Khosrowshahi will also forgo his base salary for the rest of the year.

Uber’s ride-hailing business is down more than 80 percent in recent weeks as tens of millions around the world are locked indoors.

Uber had originally promised to be profitable on an adjusted basis before interest, taxes, depreciation and amortization by the end of this year, but withdrew its full-year guidance on April 16, citing the uncertainty surrounding the global virus outbreak.

Revenue at Uber’s ride-hailing business, which contributes the bulk of the company’s revenue, increased 2 percent year-over-year, but was down more than 18 percent from the prior quarter.

Revenue from its Uber Eats delivery service rose by more than 11 percent from last quarter, but yearly revenue growth at the unit decelerated significantly.

Nearly two-thirds of Uber’s revenue is generated in the United States and Canada, where authorities began ordering people to stay indoors in the middle of March.

Uber’s competitor, Lyft, on Wednesday reported a surprise 23 percent jump in revenue and said strict cost-cutting measures ensured it remained on a “path to profitability.”

Uber’s stock closed the day up 11 percent thanks to the stronger-than-expected results from rival Lyft.

 

With Post wires.

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