Uber Technologies (UBER.N) on Tuesday forecast third-quarter operating profit above Wall Street expectations as it sees growing demand for ride hailing due to strong leisure travel trends and gradual return to in-office work.
The San Francisco-based company’s shares rose about 4% in premarket trading, while rival Lyft’s shares increased 2%, as Uber also reported a surprise second-quarter profit.
Uber’s cost controls ranging from layoffs to lower transaction costs and maintaining a steady headcount have helped the company maintain its target to post operating income profitability this year. At the same time, the number of rides after the pandemic is growing.
“Robust demand, new growth initiatives, and continued cost discipline resulted in an excellent quarter, with trips up 22% and a GAAP operating profit, for the first time in Uber’s history,” CEO Dara Khosrowshahi said.
However, Uber reported second-quarter revenue of $9.23 billion, missing analysts’ estimates of $9.33 billion, according to Refinitiv IBES data, as a weak freight market pinches.
The ride-sharing company forecast third-quarter adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) — a profitability metric keenly watched by investors — between $975 million and $1.025 billion. Analysts are expecting $925.9 million.