Uber stock tumbled Wednesday after the ride-hailing and food delivery company reported an unexpected first-quarter loss and weak outlook. Meanwhile, shares of e-hailing rival Lyft were volatile after the company reported a notable acceleration in year-over-year earnings. Recent earnings.
Uber fell nearly 6% to close at $66.40 after predicting that its second-quarter gross bookings, a key measure of total transactions on its platform, would also be lower than Wall Street expectations.
The financial report suggests growth may slow after a strong 2023, when Uber dominated the U.S. ride-sharing market and delivery business and posted its first annual profit.
The one-day drop in Uber’s stock price was the largest one since October 2022, wiping about $10 billion from its market capitalization.
Meanwhile, Lyft soared 7% to $17.78 after Tuesday’s close on better-than-expected earnings.
The company’s revenue for the first three months of 2024 was $1.28 billion, beating analysts’ expectations of $1.16 billion.
This figure represents a significant increase of 27.59% from the $1 billion in sales the company reported in the same period last year.
Lyft’s efforts to put more women in the driver’s seat contributed to an increase in female customers, with gross bookings increasing 21% on an annual basis to a total of $3.7 billion.
“We’re doing well and bringing much-needed innovation to the market, which is why drivers and riders are choosing Lyft more often,” said CEO David Risher. said at an earnings conference on Tuesday.
Risher, who took over as Lyft’s chief executive last April, said the company’s efforts to promote women led to a 24% increase in the number of female drivers in the first quarter compared to a year ago. According to the information reported earlier,
He said the company has also succeeded in increasing ridership with short wait times and competitive fares.
Overall, Lyft’s active ridership grew 12% year-over-year, and total rides grew 23%.
Market leader Uber reported a net loss of $654 million due to legal fees and regulations and costs related to the fair valuation of certain corporate investments.
Analysts had expected net income to be $503.1 million.
Total bookings for the quarter ended March 31 were $37.65 billion, slightly below expectations of $37.92 billion.
Revenue rose 15% to $10.13 billion, narrowly beating expectations of $10.11 billion.
On an adjusted basis, Uber lost 32 cents per share, compared to expected earnings of 23 cents.
2.6 billion trips were completed on the platform during the period, an increase of 21% year over year.
Uber CEO Dara Khosrowshahi told CNBC’s “Squawk Box.” On Wednesday, the company said its losses had “nothing to do with our operating business.”
“We had to reduce our shareholdings, which resulted in losses,” Khosrowshahi said. “We don’t expect that to continue in the future.”
The weaker outlook for the second quarter was due to slower rideshare demand in Latin America and the impact of certain holidays moving into the first quarter.
“We had already expected average spending to slow in some markets, given slower-than-expected U.S. economic activity in the first quarter and continued pressure from consumers. That’s far above our scenario,” said Thomas Monteiro, senior analyst at Investing.com.
