By Akash Sriram
May 6 (Reuters) – Uber Technologies forecast second-quarter bookings above Wall Street estimates on Wednesday on strong demand for ride-hailing and delivery services, even though the Middle East conflict weighed on its growth.
Shares of the San Francisco-based company rose about 7%.
The strong forecast is a sign that the company’s strategy of keeping prices steady while pushing into higher-margin areas such as its platform for businesses are paying off, helping it navigate higher fuel costs and geopolitical tensions.
Strong delivery demand in international markets, including Australia, and expansion into new geographies such as Denmark have also helped power growth.
“I see it as a sign of durable demand, plus the significant runway still left for Uber gain market share in US suburbs and international markets,” said Adam Ballantyne, senior analyst at shareholder Cambiar Investors, referring to the upbeat forecast.
Uber said it expects gross bookings of $56.25 billion to $57.75 billion for the June quarter, above analysts’ average estimate of $56.07 billion, according to data compiled by LSEG.
It factors in a roughly 60 basis-point drag from the Middle East conflict.
The company also forecast second-quarter adjusted earnings per share of 78 cents to 82 cents, slightly above estimates of 79 cents.
Uber said its growing adoption of artificial intelligence tools is helping moderate the pace of hiring by improving productivity across its operations.
It has been pushing to expand beyond ride-hailing into a broader platform spanning food delivery, grocery, travel and local commerce, including a recent move into hotel bookings.
The company has focused on growing its Uber One membership program, which has surpassed 50 million users.
Uber’s first-quarter revenue missed estimates due to weather, geopolitical tensions and higher fuel costs, though profit beat expectations, with delivery and freight outperforming and the latter returning to growth after nearly two years.
Uber is pursuing a partnership-led approach to autonomous vehicles, working with more than 20 companies to integrate robotaxis onto its platform rather than building the technology itself.
Spanish lender Banco Santander and Uber agreed a 1 billion euro ($1.18 billion) financing facility on Tuesday to support fleet operators in Europe in upgrading and expanding their vehicle fleets over the next three years.
($1 = 0.8503 euros)
(Reporting by Akash Sriram in Bengaluru; Editing by Arun Koyyur)
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