Uber loses $5.24B in Q2 after post-IPO stock payouts

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In this May 28 file photo Jump electric bike share bicycles by Uber are seen along Mission Beach boardwalk in San Diego. Uber reported second quarter financial losses of $5.24 billion Thursday. (Gregory Bull/The Associated Press)

Uber lost $5.24 billion US in the second quarter after making huge stock-based payouts in the months following its stock market debut.

The ride-hailing giant said Wednesday it paid $3.9 billion in stock-based compensation and expenses during the quarter. It also paid $298 million in stock and cash to drivers to show appreciation in connection with the IPO.

The loss per share including those expenses totalled $4.72 while revenue jumped 14 per cent to $3.17 billion. Analysts surveyed by FactSet expected a loss of $2.03 per share on revenue of $3.31 billion, on average.

“We could push the company to break even if we wanted to frankly, but I think what you will see from us is … lower losses going forward while at the same time we aggressively invest in new growth levers,” said Uber CEO Dara Khosrowshahi in a conference call with reporters. “But there’s no doubt in my mind that eventually the business will be a break even and profitable business.”

Khosrowshahi said he expects 2019 to be the company’s peak loss year and for the losses to be smaller in the next two years.

Uber’s shares fell 11 per cent in after-hours trading.

Gross bookings, which is the total dollar value of rides and Uber Eats meals and the amount paid by freight shippers, grew 31 per cent — or 37 per cent in constant currency — compared with the same time last year.

Revenue for the Uber Eats service rose 72 per cent to $595 million. Ridesharing revenue grew just two per cent to $2.3 billion because of the one-time driver appreciation payments, the company said.

SOURCE: CBC.ca

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