Uber Turns Profitable For The First Time

Uber, the company that has long defined the ride-sharing category and become the emblem of the gig economy, has turned a profit for the first time in its history. Despite being a trailblazer in the industry, it had never previously reported an operating profit. This milestone, however, has been overshadowed by a 6% drop in the stock, attributed to market expectations being higher and a quarterly revenue shortfall of around $100 million.

Marking its first quarterly profit since becoming a publicly traded entity, Uber anticipates further growth in profits, spurred by an increase in travel and a return to office life as the pandemic begins to wane. In Q2 of 2023, the company generated $394 million, recording an operating profit of $326 million and free cash flow of $1.14 billion.

The ride-sharing giant announced a net revenue of $9.23 billion for Q2 of 2023, a 14.4% increase compared to the same period in 2022. Additionally, gross bookings surged by 16% to $33.6 billion, while rides revenue and delivery income rose by 25% to $16.73 billion and 12% to $13.88 billion, respectively.

CEO Dara Khosrowshahi lauded the results, stating, “Robust demand, new growth initiatives, and continued cost discipline culminated in an excellent quarter with trips up by 22% and a GAAP operating profit for the first time in Uber's history. These results translated into strong driver and courier engagement, with 6 million drivers and couriers earning a record $15.1 billion during the quarter. Achieved through disciplined execution, record audience, and strong engagement, Uber is well-positioned to sustain robust, incremental profit generation.”

Alongside this financial milestone, the company also announced the resignation of CFO Nelson Chai, effective January 5, with a search underway for his successor.

Reflecting on his tenure, Chai said, “When I joined the company in 2018, Dara asked me to lead the financial transformation of the company. As you can see from our Q2 results, that transformation has occurred. I am very proud of the great work we all accomplished and thank Dara for his partnership.”

This news marks a significant turning point for Uber, a company that has been synonymous with innovation but has struggled to translate that into profitability. The latest results may herald a new era of financial stability and growth for the ride-sharing pioneer.