San Francisco-based Uber is seeking to assure investors it can evolve from a ride-hailing service to a global all-in-one transportation platform.
Uber
Technologies Inc. disappointed investors with quarterly results
showing lackluster gains in bookings and monthly active users, two of
the metrics most closely watched by Wall Street.
The
ride-hailing company beat estimates for quarterly revenue and loss,
improved its annual loss forecast and pledged to turn a profit by
2021. Those weren’t enough to lift the stock, though. Shares were
down about 5 per cent in extended trading after the results.
The
San Francisco-based company is seeking to assure investors it can
evolve from a ride-hailing service to a global all-in-one
transportation platform. There could be more pressure on Uber shares
Wednesday, when a stock lockup for a large swath of shareholders
expires. An additional 1.5 billion shares could be eligible to trade
according to Renaissance Capital, nearly doubling the total number
outstanding. Of venture-backed companies, only Alibaba Group Holding
Ltd. had a larger lockup of 1.6 billion shares.
While
Uber’s overall results were good, uncertainty about the possibility
of new shares flooding the market cast a shadow that may have
depressed share price, said Ali Mogharabi, an analyst at Morningstar.
“It
may be people getting out now, thinking that after Wednesday it’ll
drop,” he said.
On
a conference call with reporters following the report, Uber
executives said the company would spend less aggressively and turn an
adjusted profit in 2021. “We will be driving discipline across the
company and only doing investments that we can afford,” said Chief
Executive Officer Dara Khosrowshahi.
The
forecast echoed a commitment from Uber’s smaller rival, Lyft
Inc., which said it would be profitable by the fourth quarter of
2021, a year earlier than previously expected. Lyft, which focuses
exclusively on transportation, blew past analysts’ third-quarter
estimates when it reported results last week.
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