Uber CEO Says Ride-Hailing Will Hit All-Time Highs Next Year
Uber Sees Its Best Week During Pandemic Despite Omicron Variant
(Bloomberg) -- Uber Technologies Inc. Chief Executive Officer Dara Khosrowshahi said he’s “confident” the company’s ride-hailing business will hit record highs in 2022.
The bullish prediction comes after Uber had its best week last week since the start of the pandemic. “Post-Covid we’re an all-weather company and think we can succeed and grow really in every environment,” Khosrowshahi said in interview with Bloomberg Television on Tuesday.
The San Francisco-based company expects its consolidated gross bookings and adjusted earnings before interest, depreciation and amortization to be near the high end of the forecast delivered last month. In reporting third-quarter earnings in November, Uber said it expected adjusted Ebitda of $25 million to $75 million in the fourth quarter and gross bookings of $25 billion to $26 billion.
Uber also sees its delivery business posting incremental profits “at or above” long-term profit-margin targets of 5%, Khosrowshahi said, citing expansion in the company’s delivery audience of 25% year-over-year.
As competition among rapid-delivery startups intensifies, Khosrowshahi said Uber will focus on developing partnerships with grocery stores instead of building fulfillment warehouses of its own. “Partnerships are our first priority,” he said. Uber will look to boost growth “organically” in online grocery delivery through its partnership with Cornershop, the largest home delivery platform in Mexico and Chile.
Wait times for rides in the U.S. are less than five minutes and that surge levels are “significantly lower,” than they have been in recent months, citing improvements in driver supply, Khosrowshahi told investors at a business conference hosted by UBS Group AG earlier on Tuesday. Customers can expect fares to remain elevated due to the current inflationary environment, he said. “Gas is more expensive. I do think the base price of anything in transportation is going to increase and that includes Uber.”
Uber has seen some “local impacts” due to the omicron Covid-19 variant but on a global basis, Khosrowshahi said Uber’s ride-hailing business is nearly 90% recovered compared with pre-pandemic levels.
Looking ahead, Khosrowshahi expects there to be less activity for mergers and acquisitions at Uber in 2022. “We are always looking in the market for opportunities, but right now the hurdle is unusually high.”
Uber shares were up 4.5% at 1:56 p.m. in New York on Tuesday.
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