[Fox Business] Uber shares sink despite first profitable quarter

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Uber shares fell despite the company’s first-ever operating profit driven by growth in ride-sharing as well as deliveries. Still, investors honed in on its revenue shortfall pushing the shares lower. 

Revenue of $9.2 billion missed analysts estimates of $9.3 billion, even as net profit rose to $394 million or 18 cents per share, reversing a loss of $2.6 billion or $1.33 per share in the same period a year ago. 

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“Robust demand, new growth initiatives, and continued cost discipline resulted in an excellent quarter, with trips up 22% and a GAAP operating profit, for the first time in Uber’s history,” Uber CEO Dara Khosrowshahi said.

“These results also translated into strong driver and courier engagement, with 6 million drivers and couriers earning a record $15.1 billion during the quarter,” Khosrowshahi finished. 

Shares of Lyft fell in sympathy. Khosrowshahi added he expects Uber to benefit from its rival leaving the shared rides market. 

As for the third-quarter, the company forecast adjusted earnings before interest, taxes, depreciation and amortization between $975 million and $1.025 billion above the $925.9 million analyst forecast. 

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Uber shares have climbed 88% this year. 

“Few companies have been able to understand the so-called ‘Year of Efficiency’ better than Uber, and this report is yet another indication that the company is in perfect syntony with what the market expects from a growth stock in the face of a still challenging environment,” senior analyst at Investing.com Thomas Monteiro said in a statement sent to FOX Business. 

“More than beating EPS estimates by a wide margin, Uber showed its capacity to improve margins in many key aspects of its operation,” he added. “Uber is ahead of the competition not only in terms of posting profits today but also in terms of securing funding for its growth operations over the next few years — which is when we expect the segment to start delivering massive sums of profits.”

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Gross bookings jumped 16% year-over-year to $33.6 billion in the second quarter, while trips grew 22% year-over-year to 2.3 billion, or an average of roughly 25 million trips per day.

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Reuters contributed to this report.

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