A challenging quarter can be the bridge to the success
Uber Technologies Inc. (UBER), the company that went public just a few months before the pandemic, lost $6.8 billion last year as the fast-growing COVID-19 increase Stay home orders all around the globe, and now with reopenings and people returning to the street, again it can see more demand for its services.
Today, Thursday, November 4, and after the market close, Uber (NYSE: UBER) is scheduled to announce Q3 earnings results. According to the Zacks Consensus Estimates, the Mobility revenues indicates a 54.3% jump annually.
The most consensus EPS Estimates for the quarter ending September 2021, is from -$0.16 up to -$0.31. Zacks estimates a loss of 37 cents per share for UBER, and the consensus Revenue Estimate is $4.41B (+56.9% Y/Y).
Just to highlight the previous quarter, reported for the quarter ended Jun 2021, EPS was 58 cents per share against the Zacks Consensus Estimate of a loss of 53 cents. Total revenues of $3,929 million also outperformed the Zacks Consensus Estimate of $3,740.3 million. Published results increased significantly year over year (improved 35% sequentially), mostly after a strong recovery in its mobility operations. Also, over the last two years, that company became public, UBER has beaten EPS estimates 63% of the time. According to the Zacks data, "over the last three months, EPS estimates have seen five upward revisions and 0 downward. Revenue estimates have seen 21 upward revisions and seven downward." These data tell us that the possibility of beating is much more than missing the estimates.
What investors in the report will be focusing on are the financial performance and gross bookings. About its financial performance, since the company underperformed last year and ahead of next quarter that is expected to see the better performance, this quarter is under question, and the news can be mixed. Market expectation is to see the company's second quarterly adjusted loss per share in this fiscal year. However, most analysts expect that revenue to grow even at a slower pace compared to the second quarter. Uber had a total return of 23.2% over the past year, less than the S&P 500's total return of 39.9%.
Another factor to watch is the gross bookings for Uber's rides business. Ride's gross bookings are the key metric that can indicate the total dollar amount generated by Uber's Mobility segment. This indicator was significantly hit by the COVID-19 pandemic. And now, with easing the lockdowns, we are waiting to see a sharp increase in this part.
Zacks Ranked the Uber share as #3 (hold).
