Business context and reporting period
Uber Technologies, Inc. filed this Form 10-K for the fiscal year ended December 31, 2022. Uber operates Mobility, Delivery and Freight platforms in approximately 70 countries. The filing was signed February 21, 2023. Although the request references 2022 Q4, the filing primarily reports full-year results; selected fourth-quarter metrics are identified below.
Financial and operating performance
| Metric | 2022 | 2021 |
|---|---|---|
| Revenue | $31.9 billion | $17.5 billion |
| Gross Bookings | $115.4 billion | $90.4 billion |
| Trips | 7.642 billion | 6.368 billion |
| MAPCs, Q4 measure | 131 million | 118 million |
| Operating loss | $1.8 billion | $3.8 billion |
| Net loss attributable to Uber | $9.1 billion | $496 million |
| Adjusted EBITDA (non-GAAP) | $1.7 billion | $(774) million |
| Operating cash flow | $642 million | $(445) million |
| Free cash flow (non-GAAP) | $390 million | $(743) million |
Revenue rose 83% year over year; Gross Bookings rose 28%, or 33% on a constant-currency basis. Trips increased 20%, and Q4 MAPCs increased 11% year over year. Management said Q4 MAPCs grew 6% sequentially.
Operating loss improved to about 6% of revenue from 22% in 2021; net loss was about 29% of revenue versus 3% in 2021. Cost of revenue increased to 62% of revenue from 54%. Adjusted EBITDA turned positive, but excludes items including stock-based compensation, certain legal and regulatory costs, and investment-related gains or losses.
Segment revenue and Adjusted EBITDA:
- Mobility: revenue $14.0 billion, up 102%; Adjusted EBITDA profit $3.3 billion, up 107%. Growth reflected recovery in trip volumes and a $3.9 billion net revenue impact from UK business-model changes and historical driver-claim accruals.
- Delivery: revenue $10.9 billion, up 30%; Adjusted EBITDA profit $551 million versus a $348 million loss. Take Rate rose to 19.5% from 16.2%.
- Freight: revenue $6.9 billion, up 226%, primarily reflecting Transplace, acquired in late 2021; Adjusted EBITDA was approximately break-even versus a $130 million loss.
Revenue growth is not directly comparable with Gross Bookings growth: the Transplace acquisition and changes to the UK Mobility and certain Delivery arrangements increased revenue presented on a gross basis. Cost of revenue rose 110%, reflecting, among other factors, Transplace carrier payments, UK driver payments, insurance and certain courier payments.
Liquidity, debt and balance sheet
- Year-end cash and cash equivalents were $4.2 billion; short-term investments were $103 million. The company reported $4.3 billion of unrestricted cash, cash equivalents and short-term investments. Additional cash was restricted or held as collateral.
- Operating cash flow was $642 million and free cash flow was $390 million. 2022 cash flow included a $733 million payment resolving UK HMRC VAT claims; 2021 cash flow included a $1.0 billion inflow from a legacy auto-insurance transfer, affecting the comparison.
- Debt principal outstanding was $9.4 billion (balance-sheet long-term debt, net, was $9.3 billion). No amount was drawn under the approximately $2.2 billion revolving credit facility at year-end; the facility matures in 2027. Uber reported covenant compliance.
- Current assets were $9.2 billion and current liabilities $8.9 billion. Insurance reserves totaled $4.7 billion. Total liabilities were $23.6 billion.
Material changes, outlook and risks
- The $9.1 billion net loss included $7.0 billion of net unrealized losses on debt and equity securities, principally Aurora ($3.0 billion), Grab ($2.1 billion), Didi ($1.0 billion) and Zomato ($747 million). These valuation movements were a major reason net loss widened despite the narrower operating loss.
- Uber settled outstanding UK pre-March 14, 2022 HMRC VAT claims for approximately $733 million, paid in Q4; the filing says the settlement did not materially affect the income statement because reserves had been recorded. The company changed its UK operating model in March 2022 and said HMRC was reviewing its subsequent VAT filings; any further loss could not be estimated.
- Driver classification remains a significant contingency. Uber had paid approximately $521 million by year-end to settle US driver arbitration classification claims; California Proposition 22 litigation and challenges in other jurisdictions remain unresolved. The UK Supreme Court classified app-based drivers as workers for employment-law purposes, and Uber says more than 70,000 UK drivers receive worker-related protections.
- Recorded liabilities for probable and estimable legal, regulatory and non-income-tax matters totaled $1.6 billion. Outcomes of pending proceedings may differ from recorded estimates. The filing also describes Australian class actions scheduled for trial in February 2024.
- Management expects operating expenses to rise in absolute dollars in the foreseeable future, while anticipating improved efficiency in certain support functions. The filing provides no specific consolidated revenue, earnings or cash-flow guidance. Management said available funding and the credit facility should cover anticipated requirements for at least the next 12 months.
- Key risks include driver reclassification and related costs, intense competition and incentives, driver and customer retention, safety and insurance exposure, regulation and licensing, privacy and cybersecurity, inflation and higher insurance costs, and volatility in minority investments. Uber disclosed a September 2022 cybersecurity incident involving access to internal systems.
- Uber committed to net-zero climate emissions from corporate operations by 2030 and as a company by 2040; progress depends partly on EV availability, charging infrastructure and regulation.
PricewaterhouseCoopers issued an unqualified opinion on the financial statements and concluded internal control over financial reporting was effective as of year-end. The auditor identified revenue presentation and insurance-reserve valuation as critical audit matters.
Important facts for investors to verify
- How much of revenue growth reflects underlying activity versus Transplace and gross-versus-net accounting changes, particularly in the UK and Delivery.
- Whether Mobility and Delivery Adjusted EBITDA gains are sustainable after incentives, insurance costs and corporate expenses; reconcile non-GAAP measures to GAAP results.
- Potential cash and earnings effects of driver-classification cases, UK VAT filings, other tax disputes and recorded legal contingencies.
- Investment valuations and potential liquidity or realization constraints for minority-owned affiliates; 2022 unrealized losses were substantial.
- Debt service and refinancing needs, insurance-reserve adequacy, collateral requirements and the availability of unrestricted liquidity.
- Progress in addressing cybersecurity and safety risks, and the costs of regulatory compliance and climate commitments.