Uber Drivers, Delivery Agents Grow to 5 Million; Turns Cash Flow Positive for First Time in Bumper Quarter

Uber CEO Dara Khosrowshahi said more than 70 percent of new drivers opted to join Uber to manage a hit from inflation.

By Reuters | Updated: 2 August 2022 20:38 IST

Uber Drivers, Delivery Agents Grow to 5 Million; Turns Cash Flow Positive for First Time in Bumper Quarter

Photo Credit: Reuters

At Uber's delivery business, which includes Uber Eats, growth slowed from the prior quarter

Highlights

Uber reported a "strong flow" of new drivers and delivery agents
The firm's shares surged 13 percent to $27.9 (roughly Rs. 2,200)
Uber says 70 percent of new drivers joined due to a hit from inflation

Uber reported positive quarterly cash flow for the first time ever on Tuesday and forecast third-quarter operating profit above estimates, as more people rely on its services for transport and food delivery. The company's shares surged 13 percent to $27.9 (roughly Rs. 2,200) and helped drive an 13 percent gain in rival Lyft's stock. Uber generated free cash flow of $382 million (roughly Rs. 3,000 crore) in the second quarter, topping analysts' expectations of $263.2 million (roughly Rs. 2,100 crore), as trips exceeded levels seen before the pandemic, boosted by office reopenings and a surge in travel demand.

The company also added more drivers and delivery agents to its fleet in the quarter, taking their total number to an all-time high of about 5 million and allaying concerns that soaring gas prices were deterring them from signing up.

"We have a very strong flow of new drivers who are signing up, coming on to earn," Chief Executive Officer Dara Khosrowshahi said, adding that more than 70 percent of new drivers opted to join Uber to manage a hit from inflation and rising costs of living.

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At its delivery business, which includes Uber Eats, growth slowed from the prior quarter but the company expects ordering in to become a habit for consumers.

Revenue from Uber's delivery segment rose 37 percent to $2.69 billion (roughly Rs. 21,100 crore), while that of ride-share business surged 120 percent to $3.55 billion (roughly Rs. 27,900 crore) in the quarter ended June 30, both surpassing Wall Street expectations.

"These results are particularly impressive given the growing list of macro and micro concerns weighing on Uber and Lyft," MKM Partners analyst Rohit Kulkarni said.

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Lyft is scheduled to report results on Thursday.

Uber's net loss was $2.6 billion (roughly Rs. 20,400 crore), largely hurt by investments in companies such as India's Zomato. It is likely to sell its stake in the Indian food-delivery firm on Wednesday, a source told Reuters.

Uber's adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were $364 million (roughly Rs. 2,900 crore), surpassing estimates of $257.89 million (roughly Rs. 2,000 crore), according to IBES data from Refinitiv.

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It now expects adjusted EBITDA of $440 million-$470 million (roughly Rs. 3,500 crore to Rs. 3,700 crore), also above estimates of $383.95 million (roughly Rs. 3,000 crore).

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