(Reuters) – On Wednesday, Uber Technologies shared a projection for its current-quarter bookings that fell short of Wall Street’s expectations, joining the ranks of several U.S. firms cautioning about a strong dollar’s impact on the first few months of 2025. This news led to a roughly 3% dip in Uber’s shares during premarket trading.
On a brighter note, the San Francisco-based company exceeded revenue expectations for the fourth quarter. With more people opting for its ride-hailing service to commute to work, and a robust holiday shopping season boosting its delivery service, Uber managed to pull ahead.
As North America’s leading ride-hailing brand, Uber is on a mission to convince investors of its growth potential, targeting a broader audience including businesses and teenagers, while also exploring opportunities in less crowded markets.
The company’s business-focused service saw a substantial 50% increase in bookings over the last quarter of 2024, spurred by mandates for employees to return to the office. Similarly, Uber for Teens experienced a comparable uptick and is currently available in roughly 50 countries.
Overall, Uber’s ride-hailing revenue climbed by 25% and delivery revenue by 21%, both surpassing forecasts. The total revenue amounted to $11.96 billion, beating analysts’ average prediction of $11.77 billion, according to data from LSEG.
Gross bookings were robust at $44.2 billion, exceeding expectations, and the company reported a net profit of $6.88 billion, significantly boosted by a $6.4 billion tax valuation benefit.
In a statement, CEO Dara Khosrowshahi expressed intentions to spur growth in 2025 by offering better pricing to customers. One strategy involves scaling back on insurance cost hikes, a major expenditure for ride-hailing services.
“To maximize demand, we are committed to keeping prices as low as possible, only passing the insurance cost increases to consumers,” stated Khosrowshahi, noting that U.S. UberX fares might see a slight rise in 2025.
Competing fiercely, rival Lyft has been attracting customers from Uber with competitive pricing and innovative features like Price Lock, which promises stable rates for daily commuters.
Looking ahead, Uber anticipates first-quarter gross bookings to range between $42 billion and $43.5 billion, factoring in an estimated 5.5 percentage point impact due to a strong dollar. Meanwhile, analysts have forecasted bookings of $43.42 billion.
Its forecast for adjusted core profit in the first quarter, ranging from $1.79 billion to $1.89 billion, had a midpoint slightly below analysts’ predictions of $1.85 billion.
Uber also marked its entry into the competitive robotaxi market, announcing that Alphabet’s Waymo will debut its self-driving taxi service in Austin, Texas, exclusively on Uber’s platform next month.
In related news, Tesla CEO Elon Musk mentioned plans to test the automaker’s driverless car technology in Austin starting June, though details on launching a paid service remain under wraps.
(Report by Akash Sriram in Bengaluru; Edited by Shinjini Ganguli)
