Uber gains after Lyft blows past earnings expectations (UBER, LYFT)
- Shares of Uber rose Thursday after Lyft reported strong second-quarter earnings a day earlier.
- Analysts watching Uber are hopeful that it will also release a strong second-quarter earnings report Thursday. The company didn’t provide any guidance for Q2 in its first-quarter results.
- Investors will also be watching for signs that Uber has gained market share in ridesharing and food delivery.
- Watch Uber trade live on Markets Insider.
Shares of Uber rose as much as 7% in early trading Thursday after Lyft’s second-quarter earnings beat expectations a day earlier. Uber is set to report its own results after Thursday’s close.
Here’s what analysts surveyed by Bloomberg expect Uber to report:
Revenue: $3.06 billion
Loss per share: -$3.261 per share
Uber didn’t provide a full-year outlook in the first quarter. Investors will be watching its results for signs of changes to its market share in both ridesharing and food delivery. Analysts at Bank of America Merrill Lynch say that data suggests Uber may have gained rideshare over Lyft but lost in food delivery to competitors such as GrubHub and DoorDash.
Lyft and Uber have been locked in competition as the two most dominant players in the US, where analysts say that there’s hardly room for a third player to break up the duopoly.
As Uber looks to expand globally, there will likely be questions about competition in Latin America and Europe, where rivals have encroached on Uber’s dominant positions. In addition, Uber has struggled to obtain a long-term license to operate in London — the company expects that it will get another short-term license to operate there at the end of next month, Bloomberg reported.
Uber’s stock has had its fair share of volatility since the May IPO following a string of negative news. When it filed for its IPO, Uber revealed that it lost at least $1 billion in the first quarter of 2019. Since May, two top executives have left the company. In addition, the company recently laid off 400 marketing employees in a dozen countries in an effort to trim operations and reduce spending, according to a New York Times report.
It’s also grappling with higher fees in NYC, where new minimum wage laws for drivers and congestion fees have driven prices up as much as 11%, according to Bank of America. Still, that could boost revenue, as Lyft reported strong earnings due to higher prices that the company said will ease losses for the year.
Shares of Uber are up 2% year to date.