Uber jumps 10% as ride volume starts to recover after bottoming out in April

Uber Technologies Inc. (NYSE: UBER) released its quarterly financial results on Thursday that resulted in an initial response of the company’s stock dropping slightly in extended trading. Following CEO Dara Khosrowshahi’s statement that ride volume is now starting to recover after hitting its lowest in mid-April, however, Uber jumped 10% in after-hours trading. The company closed the regular session with an 11% gain on Thursday.  

Uber’s net loss, however, came in at £2.34 billion in the recent quarter that included impairment charges of £1.70 billion.

Uber’s Q1 financial results versus analysts’ estimates

According to Refinitiv, experts had forecast the company to print £2.83 billion in revenue in the first quarter. Their estimate for earnings per share (EPS) was capped at 71 pence per share. In its report on Thursday, Uber topped both estimates posting a higher £2.86 billion in revenue in Q1 and £1.37 of earnings per share.

Uber said that its core business, Rides, saw a 5% year over year decline in gross bookings and generated £8.77 billion in revenue in the first quarter. The segment, as per the CEO, was down roughly 80% in April as compared to the same month last year. In the past three weeks, however, Uber’s ride volume has started to recover.

On the other hand, Uber’s food delivery business, Eats, noted a 50% annualized growth in gross bookings and generated £3.78 billion in revenue in Q1 as Coronavirus restricted people from eating out and fuelled a stronger trend of home deliveries from a range of restaurants. According to Uber, the cultural shift to home delivery is likely to be long-lasting.

Uber leads a £137 million investment into Lime

Uber laid off 3,700 workers in its recruitment and customer support division on Wednesday. For the remaining months of 2020, CEO Khosrowshahi also waived his base salary of roughly £810K. As per a report on Thursday, however, Uber led a massive investment of £137 million into Lime.

Uber also cited the Coronavirus uncertainty as it withdrew its previous guidance of hitting profitability in the fourth quarter this year. The company is currently facing a lawsuit in California for wrongly classifying its drivers as contractors while the new gig economy bill requires them to be categorized as employees.

Including the gain in extended trading on Thursday, the ride-hailing company is currently around 6% up year to date and has a market cap of £43.13 billion.