Uber Technologies, Inc. — Q1 2022 Form 10-Q
Reporting period: Three months ended March 31, 2022; unaudited. Comparisons are with Q1 2021 unless stated otherwise. Amounts are in U.S. dollars.
Business context and operating performance
Uber operates Mobility, Delivery and Freight platforms. In Q1 2022, MAPCs rose 17% to 115 million, Trips rose 18% to 1.713 billion, and Gross Bookings increased 35% to $26.449 billion (39% on a constant-currency basis). MAPCs declined 3% sequentially, reflecting a slower start to the quarter associated with Omicron.
| Metric | Q1 2021 | Q1 2022 |
|---|---|---|
| Revenue | $2.903 billion | $6.854 billion |
| Operating loss | $1.524 billion | $482 million |
| Net loss attributable to Uber | $108 million | $5.930 billion |
| Basic net loss per share | $0.06 | $3.03 |
| Adjusted EBITDA (non-GAAP) | $(359) million | $168 million |
| Operating cash flow | $(611) million | $15 million |
| Free cash flow (non-GAAP) | $(682) million | $(47) million |
Revenue, margins and segments
Revenue increased 136% year over year. Growth reflected Mobility recovery, Transplace (acquired in Q4 2021), a change in the UK Mobility business model, and a prior-year UK driver-claims accrual that reduced Q1 2021 revenue. The UK model change added about $200 million to Q1 2022 Mobility revenue; the prior-year accrual was $600 million. Revenue also reflects gross presentation in certain markets where Uber concluded it controls the transportation service.
| Segment | Revenue, Q1 2022 | Adjusted EBITDA, Q1 2022 |
|---|---|---|
| Mobility | $2.518 billion | $618 million |
| Delivery | $2.512 billion | $30 million |
| Freight | $1.824 billion | $2 million |
Delivery Adjusted EBITDA improved from a $200 million loss. Mobility revenue benefited from volume recovery; Mobility Adjusted EBITDA also faced higher insurance and payment-processing costs. Freight growth was largely acquisition-driven. Consolidated costs and expenses were 107% of revenue, versus 152% in Q1 2021; operating margin improved to approximately negative 7% from negative 52%. Adjusted EBITDA is a non-GAAP measure and excludes, among other items, stock-based compensation and certain legal, tax and regulatory items.
Profit, cash flow, debt and liquidity
The $5.930 billion net loss was driven principally by $5.570 billion of net unrealized losses on debt and equity securities, including Grab ($1.9 billion), Aurora ($1.7 billion), Didi ($1.4 billion) and Zomato ($462 million). Uber also recorded a $182 million impairment of its MLU B.V. equity-method investment, partly offset by a $181 million gain from revaluing the related call option. These items substantially affected GAAP earnings but were primarily non-cash.
Operating cash flow was $15 million; capital expenditures were $62 million, resulting in $47 million of negative free cash flow. Cash and cash equivalents were $4.184 billion at quarter-end; restricted cash was $3.408 billion, for combined cash and restricted cash of $7.592 billion. Total debt principal was $9.381 billion and reported long-term debt, net of discounts and current portion, was $9.273 billion. Current assets were $8.665 billion and current liabilities were $8.652 billion. Uber reported no outstanding balance on its revolving facility at March 31 and stated it was compliant with debt covenants.
On April 4, 2022, after quarter-end, Uber amended its revolving credit facility: commitments were approximately $2.2 billion, maturity was extended to April 2027, and the minimum-liquidity covenant was reduced from $1.5 billion to $1.0 billion.
Changes, outlook and material risks
- Transplace contributed substantially to Freight revenue growth and related costs. Q1 2022 also marked a change in reportable segments to Mobility, Delivery and Freight.
- Management cited continuing COVID-19 uncertainty and driver and courier supply constraints; it said Mobility demand was recovering faster than driver availability. No specific numerical company-wide revenue or earnings guidance is provided in the filing.
- Uber said it believed cash, funding sources and available credit would meet anticipated cash needs for at least the next 12 months. This outlook depends on operating performance, collateral needs, contested tax assessments and other liquidity requirements.
- Driver classification remains a major contingency. Accrued legal, regulatory and non-income-tax liabilities were approximately $2.1 billion at March 31, 2022. Outcomes of driver-classification and other legal matters are uncertain; additional costs or adverse rulings could materially affect results or operations.
- Other notable exposures include the UK tax authority’s review of historical VAT treatment; the Russia-Ukraine conflict’s effect on MLU B.V. and the contemplated sale of Uber’s remaining Yandex.Taxi interest; investment-value volatility; competition and incentives; inflation and fuel costs; and regulatory, privacy, cybersecurity and safety risks.
- Management reported disclosure controls were effective at a reasonable assurance level. The company was reviewing and integrating Transplace’s financial controls.
Important facts for investors to verify
- How much of revenue growth reflects underlying trip and booking growth versus Transplace, UK gross presentation and the prior-year UK accrual comparison.
- Whether Mobility driver supply, insurance costs and Delivery courier availability affect margins and cash generation in subsequent quarters.
- The fair value and potential monetization of marketable investments, and any further effects of geopolitical developments on MLU B.V. and Yandex-related assets.
- Potential cash exposure from driver-classification proceedings, UK VAT matters and other legal, regulatory and tax contingencies.
- Progress toward sustained positive free cash flow, alongside debt service, restricted cash and insurance-collateral requirements.