Uber plunges into the red with heavy losses
Uber announced Tuesday, August 2, a net loss of USD 2.6 billion in the second quarter, but its revenue, which amounted to USD 8.1 billion, climbed and primarily exceeded market expectations.
Shares of the chauffeured car rental and home meal delivery giant were up more than 12 percent to $27.58 in electronic trading before the market opened.
“We continue to benefit from the increase in demand for transporting people and things as well as the shift from a store-based to a service-based spending model,” Uber boss Dara Khosrowshahi said in a statement.
“We intend to continue to take advantage of these favorable factors for our growth,” he added.
On the other hand, the company said the company said that the group’s quarterly revenue, which more than doubled from a year ago, was boosted in part by a change in the calculation of ride-hailing revenue in the United Kingdom.
Revenue from car rides rose 120% to USD3.6 billion, and revenue from meal deliveries (Uber Eats) rose 37% to USD2.7 billion.
Uber also made USD 1.8 billion in revenue from freight transportation.
In addition, the company posted positive free cash flow (USD 382 million) for the first time.
This measure is closely followed by the market, as it gives an indication of a company’s ability to make new investments.
However, the California-based group continued to lose money between April and June.
Uber attributes this loss mainly to its stake in several financially shaky companies, including Singaporean VTC platform Grab, U.S. autonomous vehicle startup Aurora and Indian restaurant aggregator Zomato.