Uber reports a $1.78 billion loss as its food-delivery business outshines rides for the first time

·2 min read
Uber Eats driver
An Uber Eats driver in Portugal in 2020.

Horacio Villalobos/Corbis via Getty Images

  • Uber on Thursday reported a wider loss in the second quarter than Wall Street expected.

  • The company's main rides business was hit hard by the coronavirus pandemic. To help make up the difference, it leaned on food delivery — which for the first time generated more revenue than its ride-hailing business.

  • Shares fell as much as 5% in after-hours trading shortly after Uber released its earnings report.

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Uber on Thursday reported second-quarter revenue that topped Wall Street's expectations for the three-month period that bore the brunt of the coronavirus pandemic, but its overall losses exceeded expectations.

For the first time, food-delivery revenue topped ride-hailing revenue and all other segments, as the company leaned heavily on its Uber Eats business to make up for the coronavirus-related downturn.

Here are the important numbers:

  • Earnings per share: $1.02 loss, versus $0.76 loss expected

  • Revenue: $2.24 billion, versus $1.82 billion expected

  • Net income: $1.78 billion loss, versus $1.27 billion loss expected

Gross bookings, a measure of total revenue from rides and food orders before paying drivers and couriers, declined 35% from the previous year, to $10.2 billion, during a period marked by a significant downturn in ride requests.

Shares of Uber fell as much as 5% in after-hours trading following the release. They had risen about 4% in regular trading on Thursday.

"We are fortunate to have both a global footprint and such a natural hedge across our two core segments," CEO Dara Khosrowshahi said in a press release. "As some people stay closer to home, more people are ordering from Uber Eats than ever before."

During the quarter, Uber announced a $2.65 billion deal to acquire the competing service Postmates and closed a deal for Cornershop, a grocery-delivery service based in Chile, as it ramped up delivery efforts. Uber has also slashed thousands of jobs this year in a bid to cut overhead costs.

Freight revenue also increased by 27%, to $211 million, as Uber's freight brokerage scaled up. Advanced Technologies Group, which is developing self-driving cars, for the first time reported revenue totaling $25 million.

Uber executives on a conference call with investors on Thursday afternoon are expected to shed more light on how the company is navigating the pandemic and the demand trends it's seeing as outbreaks wane in many countries.

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