UBER Stock Alert: Uber Posts First-Ever Profit

Uber's annual earnings were $1.11 billion, with a 137% increase in EBITDA. Investors were disappointed, causing the stock to drop.

Uber reported a strong financial performance for the year, with earnings of $1.11 billion on revenue of $32.3 billion. The company also saw a significant increase in its adjusted Earnings Before Income Taxes, Depreciation and Amortization (EBITDA), which was up by 137%. In the fourth quarter, Uber exceeded analyst estimates, earning 66 cents per share on revenue of $9.94 billion, compared to the expected 16 cents per share on revenue of $9.76 billion.

Despite these positive results, investors were not impressed, and the stock price dropped by 1.4% in early trade to $69.58 per share, with a market capitalization of about $142 billion. The absence of any mention of a dividend or stock buybacks in the latest report, as well as the fact that a significant portion of the year's profit was due to a $1 billion revaluation of Uber's equity investments, contributed to the decline in stock price. Additionally, the stock had already risen by 20% in 2024, leading to further investor skepticism.

CEO Dara Khosrowshahi, who joined Uber from Expedia in 2017, expressed optimism about the company's future, calling 2023 "an inflection point" and predicting that first-quarter revenue and earnings would surpass current street estimates. Since going public in 2019, Uber has expanded its business into freight and food delivery, but ride-sharing remains its largest and fastest-growing segment. Notably, Uber has outperformed its primary competitor, Lyft, with UBER stock up 134% over the last two years, while Lyft's stock has declined by 64%. Lyft is due to report its results on Feb. 13.

Despite its overall strong performance, Uber's freight revenues were down, and delivery only saw a 6% year-over-year increase, indicating potential areas for improvement.

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