No Promo Codes, No Problem: Uber’s New Strategy Net’s $1 Billion In Q2 (Shares Pop 11%)

Alright, if we can all take a break from scrolling the “I didn’t make the Olympic team” fails on TikTok because Uber just dropped some serious news. They absolutely crushed their Q2 earnings out of the ballpark with $1 billion in profit. After all, they do hold 76% of the rideshare market in the U.S. and it doesn’t look like they are showing any signs of slowing down. In fact, they’ve just chalked up their sixth straight quarter of over 20% trip growth.

(Source: Barrons)
And their stock? Well this earnings surprise caused share prices to shoot up 11%, making investors as happy as I am when I realized my kids go back to school next week. 

This wasn’t a fluke either. Uber’s app transactions jumped nearly 20%, and revenue soared 16%, blowing past Wall Street’s expectations. In a world where most Americans are cutting out subscriptions and eating from the dollar menu, Uber’s figured out how to make us feel good about forking over cash for a ride instead of cramming into a packed subway car.

Remember those “Summer20” promo codes and endless discounts from a few years ago? Yeah, those are as extinct as Blockbuster. Uber’s new bottom line focus means higher prices and fewer freebies. But guess what? We’re still paying up. Who wants to deal with all the unique smells on the subway when you can Uber your way there in style? It’s clear that even with the price hikes, some things are worth paying for. Uber’s CEO, Dara Khosrowshahi, nailed it: “The Uber consumer has never been stronger – more people are using the platform, and more frequently, than ever before.” 

(Source: Pew Research)
Uber’s not only getting you from A to B anymore. They’ve branched out with delivery services, partnerships with grocery delivery companies like Instacart, and new programs like Uber One for Students. This diversified approach helped boost their revenue to $3.29 billion from delivery alone. Sure, it slightly missed analysts’ estimates, but overall growth is still super impressive. 

Looking ahead, Uber’s got even bigger plans. They’re forecasting third-quarter gross bookings between $40.25 billion and $41.75 billion, with earnings projected to hit up to $1.68 billion. Analysts expect these estimates to rise, thanks to Uber’s solid Q2 performance.

For what it’s worth, I don’t think Uber’s latest earnings report is just a lucky break. It’s proof that the company has adapted to our new normal and found a way to thrive. They’ve trimmed the fat, said goodbye to money-losing side hustles, and doubled down on what actually brings in the cash. And surprise, surprise—it’s paying off big time.

Stocks.News holds positions in Uber