Uber losses widen but appetite grows for Eats

Uber Technologies Inc's ride service bookings slowly recovered in recent weeks as the company expects a coronavirus-related slowdown will delay the goal of becoming profitable by a matter of quarters, not years, Chief Executive Dara Khosrowshahi said on Thursday.

The San Francisco-based company posted a 14 percent rise in revenue supported by a 8 percent jump in food-delivery orders at its Uber Eats business in the first quarter, despite the lockdowns that began in the final weeks of the quarter.

An Uber Eats food delivery courier closes a bag with an order during a lockdown, imposed to prevent the spread of coronavirus disease (COVID-19), in central Kiev, Ukraine, April 2, 2020. /Reuters

Data from April suggests a massive impact from the COVID-19 outbreak but also some indications of a rebound in some markets, the chief executive said.

"I won't sugarcoat it -- COVID-19 has had a dramatic impact on Rides with business down globally around 80 percent in April... but there's some green shoots driving restrained optimism," he told analysts.

Khosrowshahi said Uber was seeing a "fourth consecutive week of growth" with bookings up 12 percent last week.

The comments by the CEO sparked a rally in after-hours trade, lifting Uber shares some 6 percent.

Uber reported 53 percent revenue growth in its Eats restaurant take-away delivery service, as more people ordered in to avoid the coronavirus. Eats revenues rose to 819 million U.S. dollars, about one-third of the total for Uber in the quarter.

"There's been a tremendous increase in restaurant sign-ups," said Khosrowshahi.

"We believe these trends are here to stay."

With a network of app-summoned drivers, Uber is poised to expand into delivering groceries, medicine, retail purchases and more with minimal investment, Khosrowshahi added.

The net loss of 2.9 billion U.S. dollars in the quarter was nearly triple the level of a year earlier and included massive write-downs of the value of some of its assets – which companies are required to count as losses under accounting rules.

Gross bookings were up eight percent from a year ago to 15.7 billion U.S. dollars, with revenues to the company rising 14 percent to 3.5 billion U.S. dollars.

(With inputs from AFP and Reuters)