Uber shows signs of recovery from Covid-19 slowdown

Uber's revenue was US$2.9 billion in the first three months of the year. PHOTO: AFP

NEW YORK (NYTIMES) - Uber said its business was recovering from the slowdown caused by the Covid-19 pandemic, although it continued to lose money.

The company said on Wednesday (May 5) that revenue was US$2.9 billion (S$3.87 billion) in the first three months of the year, down 11 per cent from the same period a year ago.

The decline in earnings included US$600 million that Uber has earmarked to pay for settlements with drivers in Britain, where the Supreme Court ruled in February that drivers should be classified as workers and be entitled to a minimum wage and vacation time.

Excluding the settlement fund, Uber's revenue was US$3.5 billion, an 8 per cent increase from the previous year that outpaced Wall Street expectations of US$3.28 billion.

Uber lost US$108 million, an improvement from the previous year, when it lost US$2.9 billion. Uber attributed the change to the sale of its autonomous vehicle unit, which was acquired by the self-driving truck startup Aurora in December. Uber's operating loss for the quarter was US$1.5 billion - also made worse by the British driver settlement.

On Tuesday, Uber's primary competitor in the US, Lyft, said that it was also recovering from the slowdown caused by the pandemic as riders began to return to the platform. Still, Lyft's revenue for the quarter was US$609 million, a 36 per cent decline from the previous year. Losses were US$427.3 million, 7 per cent more than its losses the previous year.

"Uber is starting to fire on all cylinders as more consumers are riding with us again while continuing to use our expanding delivery offerings," Dara Khosrowshahi, Uber's CEO, said in a statement.

While consumers have avoided travel over the past year, Uber's business has been bolstered by its food delivery service, Uber Eats. Revenue from delivery was US$1.7 billion, a 270 per cent increase from a year ago. Despite reopenings in Sydney, Australia, and New York City, Uber said that customers have continued to order food delivery at a strong pace.

But while riders have started returning to Uber and Lyft, drivers have been more hesitant. Both companies said they have faced driver shortages. During a call Tuesday with financial analysts, Lyft's president, John Zimmer, said he expected drivers who saw food delivery as a safer option during the pandemic would return to ride hailing because the pay is better and because drivers miss social interactions with riders.

Uber said it had 3.5 million active drivers and couriers during the first three months of the year, down 22 per cent from the previous year.

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