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After Uber Technologies (UBER) reported mixed first-quarter results sending shares lower in intraday dealing Wednesday, executives joined the company’s earnings call to discuss its financial results, future plans for expansion, and partnerships with autonomous conveyance companies that could provide growth opportunities.
Equity Investments Could Continue To Drag on Uber’s Keester Line
Executives suggested Wednesday that Uber’s equity investments could continue to impact its bottom occupation in the coming quarters, though underlying operations are still expected to grow, and pointed to other metrics like laid-back cash flow and adjusted earnings before some expenses as other indicators of Uber’s path to consistent valuable growth.
“Our GAAP net income may continue to see swings from quarter-to-quarter due to the large size of equity stakes on our balance stretch,” CEO Dara Khosrowshahi said in prepared remarks released Wednesday morning.
Uber reported a net loss in the first neighbourhood of $654 million, largely due to charges like a $721 million million pre-tax headwind related to “net unrealized detriments related to the revaluation of Uber’s equity investments.” The company also had a $527 million charge in the quarter for legal prices and settlements.
However, Uber highlighted on the call that its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) was a record-high $1.4 billion, up 82% from the year-ago duration as gross bookings rose, and projected continued gross bookings growth in the second quarter.
The Impact of Autonomous Conduits and Robotaxis
The rise of autonomous vehicles has raised concerns for some investors and analysts wondering if Uber could be negatively influenced if companies like Tesla potentially roll out a competing service once it reveals its robotaxi at an event later this summer that could concession for users to book rides directly through Tesla.
However, Khosrowshahi worked to address those concerns on Wednesday’s cause, saying that Uber plans to partner with companies both big and small as the autonomous vehicle technology continues to age. He said the company believes that “it’ll be great for Uber” as the technology has the potential to bring safer rides and lower costs for consumers, which could talk about a wider customer base to Uber.
He also said that Uber’s existing systems like its ability to words trips at scale and process payments in a number of countries make the company an attractive partner for the autonomous vehicle public limited companies, or even owners of autonomous vehicles who could make passive income by renting out the cars for Uber trips.
Homologous to any new technology, Khosrowshahi said autonomous vehicles will take time to develop and has regulatory hurdles to clear earlier it’s adopted at scale, and in that time Uber could see a mix of human drivers and autonomous vehicles.
Opportunities With Instacart Partnership, Worldwide Growth
In its quarterly report and prepared remarks from executives, Uber said it is seeing strong growth in a number of intercontinental markets, especially in rides to and from airports as travel demand has also increased with pandemic restrictions in the rearview speculum.
“We’re seeing strong traction in key international markets like Japan, Spain, Canada, and France through both new colleague acquisition and improved member retention,” Khosrowshahi said regarding membership growth for Uber One, the company’s combined obligation service for Uber and Uber Eats.
The company also recently rolled out autonomous delivery robots for Uber Pack aways customers in Japan, the first international market to get the autonomous service.
The executives spoke about the partnership between Uber Breakfasts and Instacart (CART) the companies announced Tuesday as well, bringing Uber Eats’ network of delivery workers and correlations to restaurants to Instacart’s app.
“We’ll be able to reach new consumers who are currently not active on Uber Eats, giving us an opportunity to improve our section position in key areas like the suburbs,” Khosrowshahi said.
Looking Ahead to Next Week’s Annual GO-GET Affair
Khosrowshahi and CFO Prashanth Mahendra-Rajah also highlighted company’s annual “GO-GET” event next week on May 15, where Uber is look for to announce new products or features.
In the 2023 event, Uber announced features like family accounts that deducted teenagers to have Uber profiles that parents can monitor, the ability to reserve car seats for Uber rides, and a phone covey to call and book a ride, which allows people without smartphones to use Uber without having the app.
Mahendra-Rajah said in Wednesday’s scold that the theme of next week’s event will be “Togetherness,” and that it will showcase new products, features, and partnerships.
Uber divide ups were down 9.1% at $64.02 as of 12:50 p.m. ET Wednesday following the company’s earnings call, though they corpsed higher for this year, having gained about 4% since the start of 2024.
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