Uber rides plunge but food delivery doubles
Many Americans are still shying away from hopping into an Uber, and that’s slamming the ride hailing company’s quarterly results. Bookings for rides fell 75% from last year, showing little sign of recovery amid the pandemic that has hurt demand.
Ride-hailing revenue from the U.S. and Canada - its largest combined market - dropped to $1.3 billion. But Uber says demand was improving in certain pockets overseas, especially in Hong Kong, New Zealand, Germany, France and Spain.
Uber is seeing the biggest pickup not in rides but in food-delivery service. Customers staying at home more than doubled their orders from Uber Eats, pushing that revenue up to $1.2 billion. But that business is still losing money and can’t make up for the weakness in its ride-hailing unit.
The company also faces operational and legal challenges in the U.S.: fewer drivers are returning to the platform compared to other countries. What’s more, California and Massachusetts have sued the company for allegedly misclassifying drivers as independent contractors.
Overall, Uber’s revenue dropped 29%, and the company lost $1.8 billion.
Uber shares lost some of their value, too, dropping 5% in early trading Friday.
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