Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Uber sees profit by end of 2020, but still expects full-year loss

Stock MarketsFeb 07, 2020 07:26PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: Uber CEO Dara Khosrowshahi speaks to the media at an event in New Delhi

By Tina Bellon and Munsif Vengattil

(Reuters) - Uber Technologies Inc (N:UBER) on Thursday moved forward by a year its target to achieve a measure of profitability to the fourth quarter of 2020, but the ride-hailing company still expects to lose a total of more than $1 billion this year.

Uber shares were up 5% in after-hours trading on the news, with Chief Executive Officer Dara Khosrowshahi saying the company would cut costs, aim to generate more repeat-customer business and try to increase use of premium ride services.

He also said Uber would accelerate growth at the company's loss-making food delivery business, Uber Eats, to become the top player in most of its worldwide markets, eventually increasing the segment's margins, currently a drag on Uber earnings.

Khosrowshahi revealed the new profitability target on a conference call with investors after the company reported results for the fourth quarter of last year, in which it continued to lose money, but increased its customer base.

Atlantic Equities analyst James Cordwell said the onus was now on management to deliver on that promise.

Uber in November promised to be profitable on an adjusted basis by the end of 2021, excluding expenses for stock-based compensation and other items.

The company on Thursday said it still expected an adjusted EBITDA loss of $1.25 billion to $1.45 billion for the full year of 2020.

In the fourth quarter of 2019, Uber boosted its revenue on an increase in global monthly active users to more than 111 million, but high costs at Uber Eats meant it continued to lose money as it tries to outspend competitors.

Some analysts remained skeptical about Uber's continued investment in the highly competitive food delivery market. Eric Ross, an analyst at Cascend Securities, said he preferred the stock of Uber's smaller ride-hailing competitor, Lyft Inc (O:LYFT), because it does not invest in expensive side projects.

Uber has vastly diversified its business over the past five years. Besides expanding its food delivery segment, Uber is also developing self-driving cars, working on long-haul trucking operations and even planning commercial passenger drone shuttles.

Lyft is expected to report quarterly results on Feb. 11.


In the fourth quarter, Uber's total revenue rose 37% to $4.07 billion on a yearly basis, roughly in line with analyst estimates.

But its net loss widened to $1.1 billion from a loss of $887 million a year earlier.

Three-quarters of Uber's revenue came from its ride-hailing service and the segment had its best quarter yet, boosted by strong growth in its premium rides segment, including Uber Comfort, which transports passengers in larger cars. On its own, Uber's ride-hailing business would be profitable, but Uber's total costs rose 25.2% to $5.04 billion in the quarter.

While revenue at Uber Eats grew nearly 14% on a quarterly basis, spending on promotional incentives outpaced the segment's revenue growth. Promotional costs as a share of revenue at Uber's Eats business grew 4% from the third quarter.

In reaching its profitability goal, Uber has vowed to exit markets where it could not become the dominant food delivery player.

The company in January sold its food-ordering business in India to local competitor Zomato, in exchange taking a stake in the startup. The Indian business contributed only 3% of gross bookings in the first nine months of last year, but accounted for a quarter of the company's adjusted operating losses.

Investors welcomed the news as a sign of Uber prioritizing profit over growth, sending the company's shares up on Jan. 21, the day after the announcement.

Uber's business model, which depends on contractors transporting passengers and delivering food, also is under threat from regulators around the world as states and cities try to increase driver pay, lower congestion and increase safety.

Khosrowshahi on Thursday said Uber was engaged in dialogue with regulators around the world and was hopeful the regulatory environment would improve.

Uber sees profit by end of 2020, but still expects full-year loss

Related Articles

Bitcoin falls 8.4% to $49,228.82
Bitcoin falls 8.4% to $49,228.82 By Reuters - Dec 04, 2021

(Reuters) - Bitcoin dropped 8.4% to $49,228.82 at 20:01 GMT on Saturday, losing $4,514.87 from its previous close. Bitcoin, the world's biggest and best-known cryptocurrency, is...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
Lake Lot
Lake Lot Feb 06, 2020 8:36PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Uber is to makemoney and privide rides . Not make its drivers happy .Dah
nick samm
nick samm Feb 06, 2020 4:34PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Worked for uber for 2 years and its a company that has no care about its drivers and has zero interest in their ideas on improving its service
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email