Uber Technologies, Inc. — Q3 2021 Form 10-Q
Reporting period: Three and nine months ended September 30, 2021. Unaudited results are compared with the same periods in 2020 unless stated otherwise. Amounts are in U.S. dollars.
Business context and operating performance
Uber operates Mobility, Delivery and Freight platforms. The quarter showed recovery in Mobility and continued Delivery growth amid COVID-19-related uncertainty and driver and courier supply constraints. MAPCs rose 40% year over year to 109 million; Trips increased 39% to 1.641 billion; Gross Bookings rose 57% to $23.1 billion, or 53% on a constant-currency basis.
Key financial metrics
| Metric | Q3 2021 | Q3 2020 | Nine months 2021 | Nine months 2020 |
|---|---|---|---|---|
| Revenue | $4.845 billion | $2.813 billion | $11.677 billion | $7.974 billion |
| Operating loss | $572 million | $1.116 billion | $3.284 billion | $3.986 billion |
| Net loss attributable to Uber | $2.424 billion | $1.089 billion | $1.388 billion | $5.799 billion |
| Net loss per share, diluted | $1.28 | $0.62 | $0.75 | $3.33 |
| Adjusted EBITDA | $8 million | $(625) million | $(860) million | $(2.074) billion |
Revenue increased 72% in Q3 and 46% for the nine-month period. Q3 operating loss was about 12% of revenue, versus 40% a year earlier. Adjusted EBITDA is a non-GAAP measure and excludes, among other items, stock-based compensation, certain legal and regulatory items, and investment-related income or losses.
- Q3 revenue by segment: Mobility $2.205 billion, up 62%; Delivery $2.238 billion, up 97%; Freight $402 million, up 40%.
- Q3 segment Adjusted EBITDA: Mobility profit of $544 million; Delivery loss of $12 million; Freight loss of $35 million. Mobility Take Rate was 22.3%; Delivery Take Rate was 17.4%.
- Cash flow, nine months: Operating cash outflow of $338 million, compared with $1.940 billion in 2020; investing cash inflow of $1.067 billion; financing cash inflow of $1.366 billion. Operating cash flow included a $1.0 billion inflow related to the legacy auto insurance transfer.
- Liquidity at September 30: Cash and cash equivalents were $6.482 billion; cash plus restricted cash totaled $9.790 billion. Current assets were $9.684 billion and current liabilities $8.126 billion. The $2.3 billion revolving facility had no balance outstanding; letters of credit reduced availability by $263 million.
- Debt: Total debt principal was $9.394 billion; balance-sheet long-term debt, net of discounts and current portion, was $9.279 billion. Uber issued $1.5 billion of 4.50% senior notes due 2029. It reported compliance with debt covenants.
Material changes, unusual items and outlook
- Q3 net loss included a $2.031 billion net unrealized loss on debt and equity securities, primarily a $3.2 billion Didi investment loss, partly offset by a $994 million Zomato gain, a $102 million Aurora gain and other investment gains. For the nine months, other income included a $1.644 billion gain on the sale of the autonomous-driving business to Aurora.
- Q3 revenue included a $123 million release of accruals for historical UK driver-classification claims, benefiting reported Mobility revenue and Take Rate. The nine-month period included a $477 million unfavorable Mobility revenue impact from the UK claims accrual.
- The legacy auto insurance transfer generated a $345 million reinsurance premium and a $103 million Q3 charge; Uber retained substantially all liabilities when considered with prior risk-transfer arrangements.
- Mobility recovery outpaced driver availability, and Delivery demand exceeded courier availability. Management said it was increasing driver incentives near term. COVID-19 effects, including demand, supply, variants and vaccination developments, remained uncertain. The filing provides no specific numerical earnings or revenue guidance.
- Material risks include driver classification litigation and regulation, including UK worker-status obligations and a Netherlands ruling; COVID-19-related demand and supply shifts; competition and incentive spending; insurance and legal contingencies; and volatility and liquidity restrictions in significant minority investments. Accrued legal, regulatory and non-income-tax liabilities were $2.287 billion at quarter-end.
- After quarter-end, Uber completed its Drizly acquisition on October 12, 2021, issuing approximately 18.9 million shares and an immaterial amount of cash. A proposed $550 million investment in Uber Freight was contingent on closing the Transplace acquisition.
Important facts for investors to verify
- Whether Mobility recovery and driver supply improve without materially higher incentives, and whether Delivery growth and improved segment economics persist.
- The scale and timing of cash requirements from driver-classification matters, non-income-tax disputes, insurance claims and other contingencies; some potential losses are not estimable from the filing.
- The value, marketability and potential earnings volatility of Didi, Zomato, Grab and Aurora investments, including applicable lock-ups and valuation assumptions.
- Progress and funding for the Transplace acquisition, and the integration, share dilution and purchase-price accounting implications of Drizly and other acquisitions.
- Adjusted EBITDA trends alongside GAAP operating losses and cash flow, noting the exclusions in Uber’s non-GAAP measure.