Uber Technologies UBER posted softer-than-expected third-quarter profit but hinted at solid holiday-season traffic, forecasting gross bookings and profit above Wall Street estimates.
Uber said revenue for the three months ended in September rose 11.4% from the year-earlier period to $9.29 billion, missing Wall Street forecasts of a $9.52 billion tally. Gross bookings rose 21% to $35.28 billion, topping the Wall Street forecast of $34.5 billion.
Mobility revenue rose 33% to $5.1 billion on gross bookings of $17.9 billion, Uber said. Delivery rose 6% to $2.94 billion on gross bookings of $16.1 billion.
Uber's net income for the quarter was $221 million. Adjusted earnings were pegged at 10 cents a share, a turnaround from the year-earlier loss of 61 cents a share, but 2 cents shy of the Wall Street Q3 consensus forecast.
Looking into the current quarter, Uber sees adjusted earnings in the region of $1.18 billion to $1.24 billion with gross bookings in the region of $36.5 billion to $37.5 billion.
“Our relentless focus on improving the product experience for both consumers and drivers continued to power profitable growth, with trip growth accelerating to 25%,” Chief Executive Dara Khosrowshahi said in a statement. “Uber’s core business is stronger than ever as we enter the busiest period of the year.”
Uber shares were marked 3% higher in mid-day Tuesday trading to change hands at $49.58 each, a move that nudges the stock's six-month gain to around 23.5%.
"We see growth in underpenetrated markets while lower pricing/fares will further drive trip growth," said CFRA Research analyst Angelo Zino, who carries a buy rating and $60 price target on Uber stock.
"We like accelerating Delivery trip growth, being led by improving retention and growth in new verticals," he added. "We are encouraged by rising profitability, specifically on the Delivery side as margins expand from network efficiencies, higher advertising revenue, and marketing/incentive optimization."
Earlier this autumn, Uber said Analog Devices Chief Financial Officer Prashanth Mahendra-Rajah would succeed Nelson Chai as finance chief. Chai plans to leave the company on Jan. 5.
Mahendra-Rajah, who has also worked with vehicle technologies supplier Wabco Holdings, joins Uber on Nov. 13.
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