Uber has recorded its first-ever cash flow positive quarter, after burning through $25B since being founded 13 years ago in its rush towards rapid global expansion. The company said it generated free cash flow of $382M in Q2. This was much higher than some estimates of ~$100M. Uber shares rose 20% after earnings were released.
“This marks a new phase for Uber, self-funding future growth with disciplined capital allocation, while maximising long-term returns for shareholders,” said Nelson Chai, the company’s CFO.
Now Uber has the task of sustaining this positive cash flow to be self sufficient.
However, the company still posted a quarterly net loss of $2.6B, $1.7B of which was attributable to poorly performing investments, including its shares in self-driving vehicle company Aurora, Singapore-based app Grab and Indian delivery app Zomato.
Uber’s ride with Zomato has now concluded. The ride-hailing firm sold its 7.8% stake in the lossmaking food delivery firm on Wednesday for over $390M, a person familiar with the matter said, becoming the latest large institutional investor to exit the Indian firm.
Overall revenue was $8.1B, up 105% YoY, as the company benefited from people re-emerging from the coronavirus pandemic. Analysts had been expecting revenues of $7.37B.
The company also followed trend and reduced hiring of corporate positions to help with reducing costs.
- High – $72.00
- Median – $45.00
- Low – $28.00
- Average – $45.26
- Current Price – $29.25
Uber’s share price, like many other names, was down significantly since the start of the year, -42%. However, the markets change of tide towards a more bullish outlook could see Uber trend upwards for the coming weeks. This adds lots of opportunity to capitalise on a short term boost in stock price.
Outlook for Q3 2022
For Q3 2022, Uber anticipate:
- Gross Bookings of $29.0B to $30.0B
- Adjusted EBITDA of $440M to $470M