Uber (NASDAQ:UBER), the ride-sharing company, posted its first annual profit as a public company.
The company said it earned $1.11 billion on revenue of $32.3 billion for the year. It said its adjusted Earnings Before Income Taxes, Depreciation and Amortization (EBITDA) was up 137%.
For the fourth quarter, Uber said it earned 66 cents/share on revenue of $9.94 billion, beating analyst estimates of 16 cents/share of earnings on revenue of $9.76 billion.
The news wasn’t good enough for investors, who sent the stock down 1.4% in early trade to $69.58 per share. The market capitalization is about $142 billion.
Why Uber Fell Today
When Uber last reported in September, it teased the possibility of a dividend and stock buybacks. Neither were mentioned in the latest report, one reason the stock price went down.
Another reason is that most of the year’s profit is tied to a $1 billion revaluation of Uber’s equity investments. Without that, Uber was only marginally profitable.
A third reason for the stock falling is that shares were already up 20% in 2024.
CEO Dara Khosrowshahi, recruited from Expedia (NASDAQ:EXPE) in 2017, called 2023 “an inflection point.” He said first-quarter revenue and earnings should be above current street estimates.
Uber came public in 2019 with a market cap of $82.4 billion. The company has since expanded into freight and food delivery. But ride-sharing remains the biggest share of the business and its fastest-growing segment.
Khosrowshahi’s most important achievement is distancing Uber from its primary competitor, Lyft (NASDAQ:LYFT). Over the last two years UBER stock is up 134% while Lyft is down 64%. Lyft is due to report its results on Feb.13.
UBER Stock: What Happens Next?
Uber’s freight revenues were down, and delivery was up just 6% year-over-year. There is a lot of room for improvement.
As of this writing, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
