Uber raises earnings outlook on ride-hail rebound; shares gain

[NEW YORK] Uber Technologies Inc raised its forecast for earnings in the current quarter, defying concerns of a lasting impact on ride-hailing demand due to to the Omicron variant of the coronavirus. Its shares jumped about 4 per cent in early trading.

Adjusted earnings before interest, tax, depreciation and amortisation are expected to be US$130 million to US$150 million, the San Francisco-based company said on Monday. This is higher than the US$100 million to US$130 million Uber projected when it announced 4th-quarter results last month and more than the US$120.4 million analysts are projecting, according to data compiled by Bloomberg.

"Our mobility business is bouncing back from Omicron much faster than we expected," chief executive officer Dara Khosrowshahi said in a filing with the Securities and Exchange Commission. "Whether for travel, commuting, or going out at night, we're seeing healthy and growing demand across all use cases, highlighting just how eager consumers are to get moving again."

The CEO said airport gross bookings at the end of February were up more than 50 per cent from the previous month, "and we're preparing for the upcoming travel season to be one of the strongest ever".

The rosier outlook accounts for a rebound in demand for ride-hailing services, which had waned at the start of the year during the height of the fast-spreading Omicron variant. Uber said trips have recovered 90 per cent and mobility gross bookings recovered 95 per cent in February, compared with the same period in 2019.

Uber's delivery business, which includes Uber Eats, continued to record strong demand, with an annualised run rate for bookings reaching an all-time high in February.

Mobility and delivery segments saw sequential improvement adjusted earnings in the current period compared with the 4th quarter, according to the filing. Uber posted revenue of US$5.8 billion during the period ending Dec 31 and reported the most active users in its history.

Uber's shares are down 29 per cent this year.

BLOOMBERG