Analysis
Uber's second quarter looked solid on paper -- $14.19 billion in revenue, up 12% year-over-year, and gross bookings of $58 billion, up 24% and comfortably ahead of the $57.23 billion analysts expected, boosted in part by roughly 8 million World Cup-related trips. The stock fell anyway, down more than 4% in premarket trading, because the number that actually moved the market was Uber's forward guidance, not its trailing results.
Third-quarter gross bookings guidance came in at $58.25 billion to $60.25 billion, a midpoint of $59.25 billion that landed just below the $59.33 billion Street consensus. Adjusted earnings guidance told a similar story, with the midpoint of Uber's $0.84-$0.88 EPS range falling short of the 89-cent average analyst estimate. Finance leadership pointed to the fading of World Cup-related travel demand as one factor behind the softer outlook -- a real tailwind in Q2 that simply won't repeat in the current quarter.
“Adjusted earnings guidance told a similar story, with the midpoint of Uber's $0.84-$0.88 EPS range falling short of the 89-cent average analyst estimate.”
The reaction is another example of a pattern showing up across this earnings season: strong trailing results getting overshadowed by guidance that merely meets, rather than beats, elevated expectations. Uber joins AMD and SpaceX this week as companies that posted genuine beats on their headline numbers and still saw their stock sell off on forward-looking commentary.
What to watch: whether Uber's bookings growth reaccelerates once the World Cup comparison rolls off in Q4, and whether ride-hailing and delivery demand broadly holds up if consumer spending softens further into the back half of the year.
