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Uber on Tuesday reported financial results that showed its business continued to advance steadily, and even turn a profit, as more passengers and drivers used its platform than ever before.
The company earned $9.3 billion in revenue in its most recent quarter, less than what Wall Street investors expected but an 11 percent increase from a year earlier, and generated $221 million in net income. This was Uber’s second consecutive quarterly profit thanks to its own business operations, rather than its investments in other companies, a milestone for a company that had faced questions for a long time about its profitability.
While other technology companies have endured mass layoffs and lingering questions about their businesses during the recent economic crisis, Uber has generally produced consistent, positive results over the past year. Its worst days came at the start of the pandemic, when rides nearly stopped and drivers abandoned the platform.
The 6.5 million drivers who transported passengers and food around the world in the last quarter were a record, Uber said. The company said improvements it had made to the driver experience, such as showing drivers a passenger’s destination and how much the driver would earn before accepting a ride, had driven interest in working for Uber.
Riders took 2.4 billion Uber trips in the quarter, a 25 percent increase from a year earlier. In October, Uber recorded a record number of monthly trips.
“These results demonstrate that Uber continues to drive profitable growth at scale and why we believe we are well positioned for the journey ahead,” Dara Khosrowshahi, the company’s CEO, said in prepared remarks.
The biggest threat to Uber’s business is the labor disputes it faces across the country. Uber drivers are classified as independent contractors rather than employees, a distinction that saves the company money because drivers must pay their own expenses and generally do not receive health insurance or a minimum wage. Uber says drivers appreciate the flexibility of being independent, rather than having to sign up for shifts.
In recent years, labor activists in states including Massachusetts, California and New York have tried to undermine that business model, arguing that it exploits drivers. The state Supreme Court will hear a challenge to a California law that voters approved in 2020, which gives drivers limited benefits but prevents them from being classified as employees. If the court strikes down the law, it will have major ramifications for Uber’s business.
With its core business doing well, Uber is moving into other sectors and regions. Khosrowshahi said the company was making “good progress” in expanding into countries such as Spain, Japan and Italy. It brought Uber One, its monthly subscription service, to 18 countries last quarter, and partnered with WaymoGoogle’s autonomous vehicle unit, to allow Phoenix passengers to request Uber rides from autonomous vehicles.
