Uber (NYSE:UBER) Surprises With Q4 Sales, Stock Soars

Petr Huřťák /
2023/02/08 7:05 am EST

Ride sharing and on demand delivery service Uber (NYSE: UBER) beat analyst expectations in Q4 FY2022 quarter, with revenue up 49% year on year to $8.61 billion. Uber made a GAAP profit of $595 million, down on its profit of $879 million, in the same quarter last year.

Is now the time to buy Uber? Access our full analysis of the earnings results here, it's free.

Uber (UBER) Q4 FY2022 Highlights:

  • Revenue: $8.61 billion vs analyst estimates of $8.51 billion (1.18% beat)
  • EPS: $0.29 vs analyst estimates of -$0.16 ($0.45 beat)
  • Free cash flow was negative $303 million, down from positive free cash flow of $358 million in previous quarter
  • Gross Margin (GAAP): 38.3%, up from 36.8% same quarter last year
  • Monthly Active Platform Consumers: 131 million, up 13 million year on year

“We ended 2022 with our strongest quarter ever, with robust demand and record margins,” said Dara Khosrowshahi, CEO.

Born out of a winter night thought: "What if you could request a ride from your phone?" Uber (NYSE: UBER) operates a global network of on demand services, most prominently ride hailing and food delivery, and freight.

The iPhone changed the world, ushering in the era of the “always-on” internet and “on-demand” services - anything someone could want is just a few taps away. Likewise, the gig economy sprang up in a similar fashion, with a proliferation of tech-enabled freelance labor marketplaces, which work hand and hand with many on demand services. Individuals can now work on demand too. What began with tech enabled platforms that aggregated riders and drivers has expanded over the past decade to include food delivery, groceries, and now even a plumber or graphic designer are all just a few taps away.

Sales Growth

Uber's revenue growth over the last three years has been impressive, averaging 46.6% annually.

Uber Total Revenue

This quarter, Uber reported a very impressive 49% year on year revenue growth, roughly in line with what analysts expected.

In volatile times like these we look for robust businesses with strong pricing power. Unknown to most investors, this company is one of the highest-quality software companies in the world, and their software products have been the default standard in critical industries for decades. The result is an impressive business that is up an incredible 18,152% since the IPO. You can find it on our platform for free.

Usage Growth

As a gig economy marketplace, Uber generates revenue growth by a combination of the volume of services users order and how much commission it earns.

Over the last two years the number of Uber's paying users, a key usage metric for the company, grew 25.9% annually to 131 million users. This is a fast growth for a consumer internet company.

Uber Monthly Active Platform Consumers

In Q4 the company added 13 million paying users, translating to a 11% growth year on year.

Key Takeaways from Uber's Q4 Results

Sporting a market capitalization of $69.6 billion, more than $4.31 billion in cash and with positive free cash flow over the last twelve months, we're confident that Uber has the resources it needs to pursue a high growth business strategy.

We were impressed by the exceptional revenue growth Uber delivered this quarter. And we were also glad to see the user growth. Overall, we think this was a really good quarter, that should leave shareholders feeling very positive. The company is up 8.32% in the premarket and currently trades at $37.88 per share.

Should you invest in Uber right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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The author has no position in any of the stocks mentioned.