American technology company Uber has reported a loss in the second quarter, despite revenue rising. As the business boosted expenditure to maintain and bring riders back to its service.
The company reported an adjusted loss before interest, taxes, depreciation, and amortization (Ebitda) of $509 million in the second quarter, which includes one-time expenditures. This was a $150 million decrease from the previous quarter but a $328 million increase over the same period the previous year.
In the April-June period, Uber spent roughly $250 million on driver incentives, according to experts, escalating losses in its ride-hailing segment and impacting business.
“In the second quarter, we invested in recovery by investing in drivers and we made strong progress, with monthly active drivers and couriers in the US increased by nearly 420,000 from February to July, while adding that Our platform is getting stronger each quarter, with consumers who engage with both mobility and delivery now generating nearly half of our total company gross bookings.”
Meanwhile, Uber’s Chief Financial Officer, Mr. Nelson Chai stated that the business is “now well-positioned to reach adjusted Ebitda profitability by the fourth quarter” of this fiscal year after making significant investments in the second quarter to enhance the marketplace balance.
The company maintained its target of reaching profitability by the end of the year on adjusted earnings before interest, taxes, depreciation, and amortization (Ebitda) basis. The loss in the third quarter, which ends on September 30, will be less than $100 million, according to the company.
After completing the regular session down 2.2 percent, the company’s stock plunged more than 7 percent to $41.80 per share in after-hours trading. In the last year, the stock’s price has risen by more than 25 percent.
Mr. Chai further remarked that “As we make progress towards that important milestone, we expect our adjusted Ebitda loss in the third quarter to improve to less than $100 million in addition to record gross bookings between $22 billion and $24 billion.”
Furthermore, Monthly active platform consumers (MAPC) increased by 84 percent year over year to 101 million. During the second quarter, each MAPC spent an average of $72 each month and used the platform nearly five times, according to the firm.