Uber Announces Financial Report for Second Quarter 2023
In the financial report for the second quarter of the 2023 fiscal year, Uber announced that it had generated a revenue of $9.2 billion, marking a 14% increase compared to the same period last year. The profits reached $326 million, reversing a deficit from the previous year by $1 billion, and representing an impressive quarter-on-quarter growth of $588 million. This is the first time Uber has turned a profit in its decade-long operation.
Adding the profits derived from additional equity investments, Uber’s profits for the previous quarter were $394 million, which is a substantial improvement from the loss of $2.6 billion in the corresponding period of the previous year.
Uber emphasized that the total value of orders fulfilled through its platform in the previous quarter amounted to $33.6 billion, a 16% increase year on year. Among them, the total order value related to mobility was $16.7 billion, marking a 25% growth from the previous year. Meanwhile, food delivery-related orders totaled $15.6 billion, indicating a year-on-year increase of 12%.
Additionally, the number of scheduled rides grew by 22% compared to the same period last year, totaling 2.3 billion times. Translated, it equates to as many as 25 million rides per day, implying a steady increase in the number of rides booked through Uber’s service.
Since Uber’s establishment in 2009, the company has made strides to attract more users and increase driver-related subsidies, which has led to considerable losses. Despite skepticism from the market regarding the sustainability of its operating model, persistent external investments have allowed Uber to continue its operations and seek to increase profitability through different business ventures.
Starting in 2019, Uber began to make efforts to reduce operating costs and discard unprofitable ventures, including non-core businesses like autonomous driving. It even transferred its operations to regions like Southeast Asia to reduce overall expenses.
Although the pandemic had a significant impact on Uber’s ride-booking services, food delivery services, including Uber Eats, saw a significant increase in user numbers.
However, as the pandemic began to ease, the number of people returning to Uber’s services increased, causing a noticeable increase in the overall cost of using ride-hailing and food delivery services.
Uber CEO, Dara Khosrowshahi, stated that the primary reason for the increase in service fees was due to inflation, and it was necessary to balance costs through fee adjustments. However, from a holistic perspective on service development, Khosrowshahi believes that the previous strategy of competing for market share through low prices should be terminated. Instead, Uber should transition to providing higher-quality services that offer users a more convenient experience.
Initially, Uber attracted a large number of users from traditional taxi services by heavily subsidizing the service cost. However, this resulted in a large amount of invested capital being used to pay drivers or even to pay fines arising from conflicts with local laws. Although it successfully captured the market in many regions, it led to an ongoing increase in losses.
After taking the reins at Uber, Khosrowshahi actively adjusted the business model and made efforts to eliminate unprofitable projects, while exploring more possibilities for profitability.
Khosrowshahi emphasized that over the past four years, Uber’s partner drivers have seen their weekly income increase by approximately 40% to 50%. Despite the overall increase in usage fees, up to 130 million people still use Uber’s services every month, demonstrating its continued appeal.
In its future plans, Uber intends to incorporate a broader range of services into its platform. While it currently mainly provides ride-booking and food delivery services, it hopes to connect more services related to “mobility” in the future.
