Uber Stock Drops After Earnings: Guidance Misses the Mark

Uber Technologies (NYSE: UBER) shares took a tumble on Wednesday, falling around 7% in premarket trading after the ride-hailing giant reported fourth-quarter results that beat analysts' expectations for revenue but missed on earnings per share (EPS) and offered soft guidance. The company's stock price decline reflects investors' disappointment with the earnings per share (EPS) and guidance for the upcoming quarter, despite the strong revenue growth.



Uber's revenue grew 20% in its fourth quarter to $11.96 billion, surpassing analysts' expectations of $11.77 billion. However, the company's adjusted EPS of 23 cents fell short of the 50 cents expected by LSEG. Additionally, Uber's guidance for the first quarter of 2025 missed the mark, with gross bookings expected to grow between 17% to 21% and adjusted EBITDA anticipated to be between $1.79 billion to $1.89 billion. Analysts had expected gross bookings to grow by 24% and adjusted EBITDA to reach $1.85 billion.



The primary drivers behind Uber's strong revenue growth in the fourth quarter were its Mobility and Delivery segments. The Mobility segment, which includes ride-sharing, car-sharing, micromobility, rentals, public transit, taxis, and other modalities, reported a 25% year-over-year increase in revenue to $6.91 billion. The Delivery segment, which allows users to search for and discover restaurants, grocery, alcohol, convenience, and other retail items, reported a 21% year-over-year increase in revenue to $3.77 billion.

However, investors' focus on the company's EPS and guidance led to a decline in Uber's stock price. The company's guidance for the upcoming quarter was light, which disappointed investors and contributed to the stock's decline. Investors should closely monitor the company's guidance to assess its future prospects and potential growth opportunities.



When evaluating Uber's long-term potential, investors should focus on key metrics such as gross bookings, adjusted EBITDA, free cash flow, EPS, and guidance. By evaluating these metrics, investors can gain a better understanding of the company's long-term potential and make informed investment decisions.

In conclusion, Uber's stock price decline following the earnings report reflects investors' disappointment with the company's EPS and guidance for the upcoming quarter. Despite the strong revenue growth, investors' focus on these metrics led to a decline in the company's stock price. Investors should closely monitor the company's guidance and key metrics to assess its future prospects and potential growth opportunities.