Analyst Note| Ali Mogharabi |
Uber reported first-quarter results with the top and bottom line beating the FactSet consensus estimates. Gross bookings displayed strong growth driven by continuing strength in the delivery business and demand improvement in mobility. Adjusted EBITDA loss in delivery improved from a year ago, while the mobility segment continued to generate positive adjusted EBITDA. Like its peer Lyft, Uber is experiencing limited supply in mobility and expects higher driver acquisition costs in the second quarter which will pressure mobility take rates and the segment’s bottom line, but we expect it to remain adjusted EBITDA profitable. As we have mentioned before, we think Uber can more easily cross sell mobility to its existing delivery drivers. In our view, the firm’s revenue diversification strategy is paying off as mobility is showing signs of recovery, while the delivery business continues to display impressive organic and overall growth.