Uber’s ride-hailing trips take hit by COVID-19 but its food-delivery business hikes

Uber Technologies Inc has reported more than twice the number of orders from Homebound customers during the second quarter for the services offered by company’s food-delivery segment but the demand for ride-hailing bookings showed only a bit of recovery from pandemic-hit lows.

The company’s ride booking business increased 5 percentage points compared to the April’s low but the company reported decline of 75% in gross bookings compared to prior year same period.

The company has aim to hitch on the goal of staying profitable on an adjusted basis before the end of 2021 despite the challenges from pandemic depending on the rigorous cost-cutting measures and a firm balance sheet. The riding and home delivery company reported an adjusted loss of $837 million for the second quarter without the interest, taxes, depreciation and amortization.

Uber’s chief executive officer, Dara Khosrowshahi, said in the conference call that recovery in rides bookings during the quarter depended on the ability of different countries to cope with spread of virus where recovery is so far led by Asia but excluding India. Khosrowshahi said, “Our global geographic footprint remains a huge advantage.”

Uber saw about year-over-year 50% decline active platform users numbers to across the 69 countries from 99 million to 55 million in which Uber operates.

The compaby second-quarter revenue dropped 29% to $2.24 billion compared to the prior year same quarter. However, based on IBES data from Refinitiv, the revenue beat the analysts’ average estimate of $2.18 billion .

While the company saw a winning streak in revenue achieved from Uber Eats as it doubled to $1.2 billion after the greater demand for home delivery when Americans were bound to stay inside home. While its delivery last month was also expanded by the Postmates Inc acquisition for $2.65 billion which expanded its business of supplying everyday goods.

Uber stated that lower number of ride-hail drivers in  U.S.  were coming back to the Uber platform compared to other countries. Uber is also facing number of legal challenges related to the its drivers’ status in the U.S. It was sued by California and Massachusetts over the alleged drivers’ misclassification as independent contractors.

Uber Eats which saw more than doubled gross bookings, showed the decline in losses. Uber Eats reported adjusted EBITDA loss of $232 million in the second quarter.

Cheyenne Cox is a news report covering multiple Market and economy News. She is creative and highly professional writer. Cheyenne holds a degree in communication and journalism and has also a Diploma in digital marketing. She belongs to south Africa who has also lived in Europe and is currently based in the US.

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