Uber posted its first profitable quarter on an adjusted basis since its launch in March 2009, driven by a recovery in its ride-hailing and delivery businesses in the July-September period, but its projected gross bookings fell below analyst estimates.
The company reported adjusted earnings of $8 million before interest, tax and other expenses in the three months to the end of September. This is compared to a loss of $625m in the prior year period and $509m in the quarter that ended on June 30.
“While we recognise it is just a step, reaching total-company adjusted Ebitda [earnings before interest, taxes, depreciation and amortisation] profitability is an important milestone for Uber,” the company’s chief financial officer, Nelson Chai, said.
Our early and decisive investments in driver growth are still paying dividends, with drivers steadily returning to the platform, leading to further improvement in the consumer experience
Dara Khosrowshahi,
Uber chief executive
“Not only did our mobility business recover to pre-Covid margins this quarter, our core restaurant delivery business was profitable on an adjusted Ebitda basis for the first time as well, bringing the full delivery segment close to breakeven,” said Mr Chai.
However, a huge drop in the value of Uber’s stake in Chinese ride-hailing company Didi caused a $2.4 billion net loss in the quarter.
This was primarily due to an unrealised loss of $3.2bn related to the revaluation of Uber’s Didi equity investment, the company said. It added that some of the loss was partially offset by its stakes in other companies such as Zomato, Aurora and Joby.
The net loss also included $281m in stock-based compensation expense. The company’s loss more than doubled compared to the same period last year, when it suffered a loss of $1.08bn.
The California-based company’s sales during the quarter soared 72 per cent on an annualised basis to more than $4.8bn, surpassing analysts' estimate of $4.4bn.
The company’s gross bookings surged 57 per cent year-on-year to 23.1bn in the third quarter — $1.2bn, or more than 5.4 per cent, up on a quarterly basis.
Delivery gross bookings increased 50 per cent during the period to $12.8bn and mobility bookings surged 67 per cent to $9.9bn.
Uber said its mobility gross bookings grew strongly in the US, Canada, Europe, the Middle East and Africa but a decline was reported in Australia and New Zealand due to Covid-induced lockdowns.
In its future guidance, the company expects gross bookings of $25bn to $26bn with an adjusted Ebitda of $25m to $75m, below Wall Street expectations.
Uber said its drivers and couriers earned $8.6bn in the third quarter.
Its active US mobility drivers in the third quarter were up about 60 per cent year-on-year and improved through October, with 10 consecutive weeks of driver growth since the end of August.
“Our early and decisive investments in driver growth are still paying dividends, with drivers steadily returning to the platform, leading to further improvement in the consumer experience,” Uber’s chief executive Dara Khosrowshahi said.
“This is especially important as mobility reignites … mobility gross bookings are up 18 per cent over just the last two months and this Halloween weekend surpassed [the] 2019 levels,” added Mr Khosrowshahi.
The company said unrestricted cash and cash equivalents were at $6.5bn as of September 30.
Revenue in the US and Canada jumped almost 66 per cent yearly to about $2.6bn in the past quarter. It grew 29 per cent in Latin America to $390m and 80 per cent in Europe, the Middle East and Africa to $1.06bn.
It also increased about 131 per cent to $743m in the Asia-Pacific region.
Trips on Uber’s platform increased 8.6 per cent quarterly and 39 per cent on an annual basis to more than 1.6 billion in the third quarter.
The monthly active platform consumers reached 109 million, jumping 8 per cent quarterly and 40 per cent annually.
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Abu Dhabi Sustainability Week
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Zimbabwe v UAE, ODI series
All matches at the Harare Sports Club:
1st ODI, Wednesday, April 10
2nd ODI, Friday, April 12
3rd ODI, Sunday, April 14
4th ODI, Tuesday, April 16
UAE squad: Mohammed Naveed (captain), Rohan Mustafa, Ashfaq Ahmed, Shaiman Anwar, Mohammed Usman, CP Rizwan, Chirag Suri, Mohammed Boota, Ghulam Shabber, Sultan Ahmed, Imran Haider, Amir Hayat, Zahoor Khan, Qadeer Ahmed
Red flags
- Promises of high, fixed or 'guaranteed' returns.
- Unregulated structured products or complex investments often used to bypass traditional safeguards.
- Lack of clear information, vague language, no access to audited financials.
- Overseas companies targeting investors in other jurisdictions - this can make legal recovery difficult.
- Hard-selling tactics - creating urgency, offering 'exclusive' deals.
Courtesy: Carol Glynn, founder of Conscious Finance Coaching
WOMAN AND CHILD
Director: Saeed Roustaee
Starring: Parinaz Izadyar, Payman Maadi
Rating: 4/5
Sri Lanka-India Test series schedule
- 1st Test India won by 304 runs at Galle
- 2nd Test Thursday-Monday at Colombo
- 3rd Test August 12-16 at Pallekele
The specs
Price, base: Dh228,000 / Dh232,000 (est)
Engine: 5.7-litre Hemi V8
Transmission: Eight-speed automatic
Power: 395hp @ 5,600rpm
Torque: 552Nm
Fuel economy, combined: 12.5L / 100km
Zayed Sustainability Prize
The Cairo Statement
1: Commit to countering all types of terrorism and extremism in all their manifestations
2: Denounce violence and the rhetoric of hatred
3: Adhere to the full compliance with the Riyadh accord of 2014 and the subsequent meeting and executive procedures approved in 2014 by the GCC
4: Comply with all recommendations of the Summit between the US and Muslim countries held in May 2017 in Saudi Arabia.
5: Refrain from interfering in the internal affairs of countries and of supporting rogue entities.
6: Carry out the responsibility of all the countries with the international community to counter all manifestations of extremism and terrorism that threaten international peace and security
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
Visit Abu Dhabi culinary team's top Emirati restaurants in Abu Dhabi
Yadoo’s House Restaurant & Cafe
For the karak and Yoodo's house platter with includes eggs, balaleet, khamir and chebab bread.
Golden Dallah
For the cappuccino, luqaimat and aseeda.
Al Mrzab Restaurant
For the shrimp murabian and Kuwaiti options including Kuwaiti machboos with kebab and spicy sauce.
Al Derwaza
For the fish hubul, regag bread, biryani and special seafood soup.
Various Artists
Habibi Funk: An Eclectic Selection Of Music From The Arab World (Habibi Funk)
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
Match info
Uefa Nations League Group B:
England v Spain, Saturday, 11.45pm (UAE)
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