Uber Q4 net profit totals $6.8 billion, revenue jumps 25%; Gross bookings up 18% to $44.2 billion | Stock Market News

Uber Q4 Results: Uber Technologies reported weaker-than-expected fourth-quarter earnings and operating income dragged by rising costs, overshadowing steady bookings growth. Uber’s forecast first-quarter bookings were short of estimates due to a strong US dollar after US President Donald Trump’s policies.

The bookings forecast overshadowed the San Francisco-based company’s fourth-quarter revenue beat, helped by stable ride-hailing demand for office commutes and its delivery business benefited from a strong holiday-season.

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Uber Q4 Results: Key Metrics

Uber’s gross bookings, which includes ride hails, delivery orders and driver and merchant earnings but not tips, grew 18 per cent to $44.2 billion in the last three months of 2024. For the current quarter, it forecast bookings of $42 billion to $43.5 billion.

Adjusted earnings before interest, taxes, depreciation and amortization were $1.84 billion, just shy of the $1.85 billion that Wall Street was projecting, Uber said in a statement on Wednesday. Income from operations for the fourth-quarter was $770 million, well below the average estimate of $1.2 billion.

Gross bookings, which includes ride hails, delivery orders and driver and merchant earnings but not tips, grew 18 per cent to $44.2 billion in the last three months of 2024. For the current quarter, it forecast bookings of $42 billion to $43.5 billion. 

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Already the dominant ride-hailing service in North America, Uber has been trying to convince investors that it has more room for growth by attracting more businesses and teens to its platform, as well as expanding to less saturated markets. Adjusted profit in the last three months of 2024 was 23 cents per share.

Its business-focused service reported a 50 per cent surge in bookings for the last three months of 2024, driven by return-to-office mandates, while Uber for Teens posted a similar jump, and is now available in about 50 countries.

Ride-hailing revenue jumped 25 per cent and delivery revenue rose 21 per cent, above Wall Street estimates. The total revenue of $11.96 billion surpassed analysts’ estimate of $11.77 billion. The total costs and expenses rose 20.5 per cent to $11.19 billion, resulting in operating income of $770 million missing estimates of $1.22 billion.

Uber’s first-quarter gross bookings forecast between $42 billion and $43.5 billion, includles an estimated 5.5 percentage point impact from a strong dollar. The midpoint of its first-quarter adjusted core profit forecast of $1.79 billion to $1.89 billion was also slightly lower than analysts’ estimates of $1.85 billion.

“Discrete legal and regulatory related matters” offset income gains from a “strong operating performance,” said Uber Chief Executive Officer (CEO) Dara Khosrowshahi said in a prepared statement after the earnings statement.

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In prepared remarks, Chief Financial Officer (CFO) Prashanth Mahendra-Rajah cited continued currency headwinds, as well as impact from the recent Los Angeles fires and “extreme weather in January.” Uber’s US flagship rideshare business, which accounts for more than half of its profitability, has lately been weighed down by rising insurance prices. 

According to Bloomberg, executives have blamed these expenses for slowing demand ride demand, saying it’s had to pass higher costs on to consumers in certain markets such as New Jersey, Southern California and parts of Florida.

CEO Dara Khosrowshahi said Uber planned to drive growth in 2025 by offering customers better rates, in part by slowing hikes in insurance charges, a major expense for ride-hailing firms in the past couple of years.

“To maximize demand, we remain committed to keeping prices as low as possible, passing through only the insurance cost increases to consumers,” he said in prepared remarks, adding that he expected US UberX prices to be up marginally in 2025.

According to Reuters, Uber, while positioning itself as a major contender in the robotaxi race, said that Alphabet’s Waymo will launch its self-driving taxi offering in Austin, Texas, exclusively on Uber’s platform next month. On Wednesday, shares of Uber traded 7.77 per cent lower at $64 on the NYSE.