Uber for travellers: After announcing its first profit, the US company plans to become the Amazon of transportation.
Uber announced its second-quarter results on August 2, 2023, which showed that the company is finally making money after years of losses. The results were driven by growth in its core ride-hailing business.
The company has announced plans to become an app for all travel means, expanding beyond its core ride-hailing business. This means it will allow users to book and pay for various transportation options, including public transit, bikes, and scooters. The move is part of Uber’s efforts to become a one-stop-shop for transportation, offering a seamless experience for users. The company’s CEO, Dara Khosrowshahi, has said that Uber wants to be the “Amazon of transportation”.
Uber wants to compete with Google
Uber’s expansion into other transportation options could help the company diversify its revenue streams and reduce its reliance on its core ride-hailing business. The move could also help Uber compete with other transportation apps, such as Google Maps and Citymapper, which already offer various transportation options. The company has already made some moves in this direction, including acquiring bike-sharing company Jump and integrating public transit options into its app.
However, the move could face challenges, including regulatory hurdles and competition from other transportation providers. Undoubtedly, Uber’s plans to become an app for all travel means represent a significant shift for the company and could have major implications for the transportation industry.
Analysts praised the company
The company’s revenue ticked up 14 per cent last quarter, marking a slower growth pace than previous quarters. Despite the profit milestone, Uber’s shares dropped after the company missed revenue expectations. However, some analysts praised Uber’s focus on profitability and its ability to generate cash flow.
Uber’s gross bookings for the third quarter of 2023 are expected to be between $34 billion and $35 billion, with adjusted EBITDA of $975 million to $1 billion. The company’s GAAP operations and support costs were $664 million, while sales and marketing costs were $1.2 billion.
Dara Khosrowshahi said that the company’s focus on profitability is paying off. The company’s growth in the ride-hailing business was driven by increased demand for Uber’s services in emerging markets. Uber’s food delivery business, Uber Eats, also saw growth in the second quarter, with gross bookings up 85 per cent year-over-year.