Uber Q2 loss narrows as bookings soar

Uber is covering 50 to 60 per cent of the true cost of each ride.
Logo of the ride sharing service Uber in front of its headquarters in San Francisco, California.
Logo of the ride sharing service Uber in front of its headquarters in San Francisco, California.PHOTO: AFP

SAN FRANCISCO (AFP) - Uber's financial engine appeared to be purring despite its image being dented so badly its chief was pressured to resign.

Earnings figures first reported at news website Axios and confirmed by AFP showed that adjusted net revenue at Uber was US$1.75 billion in the second quarter, more than doubling from about US$800 million in the same period in 2016.

Gross bookings at the leading smartphone-summoned ride service doubled to US$8.7 billion in the recently ended second quarter as the number of trips climbed 150 per cent from a year earlier.

The San Francisco-based company's adjusted net loss fell nearly 14 per cent to US$645 million from the same quarter last year, Uber confirmed.

Meanwhile, Uber drivers have earned US$50 million in tips since a gratuity option was added to the ride-sharing application in June.

Uber has been working to improve its relationships with drivers and riders after being hit with controversies that led to the resignation of founder and chief executive Travis Kalanick.

The company is still searching for a new chief as rumors swirl that Kalanick is orchestrating a return behind the scenes.

 

Four mutual funds this week marked down their stakes in Uber by as much as 15 per cent in a sign that months of scandal were taking a toll on the private company's value of some US$68 billion, according to a report in the Wall Street Journal.

Kalanick is asking for the dismissal of an investor lawsuit against him, calling it part of a personal attack aimed at sidelining him.

A response last week to a lawsuit filed by early Uber investor Benchmark Capital said the litigation was part of a "shameful" effort to remove Kalanick from any role at the ridesharing giant.

The Benchmark lawsuit filed in a Delaware court accused Kalanick of fraud, breach of contract and of plotting to manipulate the board of directors to allow him to return as CEO following his resignation in June.

But in his response, Kalanick claimed that Benchmark "began secretly planning an effort to oust him" and "executed its plan at the most shameful of times" following the death of his mother in a May accident.

Kalanick argued that the lawsuit - which has brought to light strains and infighting at the world's most valuable venture-backed startup - should be dismissed and that the dispute should be settled in arbitration.

Kalanick said Benchmark seeks to "silence and sideline" him and effectively ban him from any major decisions at Uber.

Benchmark has asked the court to bar Kalanick from tinkering with the Uber board in any way, arguing that the former CEO was trying to pack the board with loyalists to clear the way for his return.

Kalanick - who had been the driving force behind Uber's massive global expansion, but whose brash style had made him a liability - still holds a large voting stake in the company.

The pioneering company has been facing pressure to rein in a no-holds-barred management style led by Kalanick, 40, and to reform its work environment.

Kalanick's departure capped a rocky period for the global ridesharing giant, which has been roiled by disturbing reports of a cutthroat workplace culture, harassment, discrimination and questionable business tactics to thwart rivals.