Uber slumps 7% in premarket after earnings

Uber Technologies (UBER.US) is taking a hit in US premarket trading today. Stock sinks 7% following release of Q1 2024 earnings report. Company reported sales and bookings that were more or less in-line with analysts' expectations, but disappointed with profits data. Moreover, forecasts for Q2 2024 also turned out to be disappointing.

Uber Technologies reported a 15% YoY growth in Q1 revenue to $10.13 billion, slightly exceeding markets expectations. However, growth in cost of revenue reached 17.3% YoY, signalling a deterioration in efficiency. While adjusted EBITDA turned out to be better-than-expected, other profit measures disappointed. Gross profit missed expectations and operating income turned out to be much lower than expected. Also, net income has unexpectedly come in negative, while analysts hoped for the fourth consecutive quarter of profits. Gross bookings data came in slightly below expectations, mostly due to miss in Mobility segment bookings.

However, the biggest disappointment came from Q2 outlook. Company expects gross bookings to reach $38.75-40.25 billion, or be 15.3 - 19.8% YoY higher. This not only signals a slowdown from Q1 growth, but also the midpoint of forecast range ($39.5 billion) turned out to be below $40 billion expected by analysts. On the other hand, midpoint of adjusted EBITDA forecast ($1.49 billion) turned out to be slightly higher than expected.

Uber Q1 2024 earnings

• Revenue: $10.13 billion vs $10.11 billion expected (+15% YoY)
• Cost of revenue: $6.17 billion vs $6.10 billion expected (+17.3% YoY)
• Gross profit: $3.96 billion vs $4.03 billion expected (+11.2% YoY)
  • Gross margin: 39.1% vs 39.9% expected (40.4% a year ago)
• Operating income: $172 million vs $622 million expected (-$262 million a year ago) 
  • Operating margin: 1.7% vs 6.2% expected (-3.0% a year ago)
• Adjusted EBITDA: $1.38 billion vs $1.32 billion expected (+82% YoY)
  • Adjusted EBITDA margin: 13.6% vs 13.1% expected (8.6% a year ago)
• Net income: -$654 million vs +$482 million expected (-$157 million a year ago)
  • Net margin: -6.5% vs +4.8% expected (-1.8% a year ago)
• EPS: -$0.32 vs +$0.22 expected (-$0.08 a year ago)
• Gross bookings: $37.65 billion vs $37.97 billion expected (+20% YoY)
  • Mobility: $18.67 billion vs $19.15 billion expected (+25% YoY)
  • Delivery: $17.70 billion vs $17.54 billion expected (+18% YoY)
  • Freight: $1.28 billion vs $1.28 billion expected (-8.5% YoY)
• Trips: 2.57 billion vs 2.60 billion expected (+15% YoY)
• Monthly active platform consumers: 149.0 million vs 149.8 million expected (+15% YoY)

Uber Q2 2024 forecast

• Gross bookings: $38.75-40.25 billion vs $40.0 billion expected
• Adjusted EBITDA: $1.45-1.53 billion vs $1.47 billion expected

Uber (UBER.US) is trading over 7% lower in US premarket, following Q1 earnings release. Current premarket quote suggest that the stock will erase all of recent gains at session launch and will be testing recent local lows in the $66 area. Source: xStation5