Uber Technologies Inc. took a significant detour on the road to profitability three months ago with a jaw-dropping $5.24 billion quarterly loss, deepening its losses to more than $6 billion this fiscal year.
So when the ride-hailing service reports third-quarter financial results on Monday, investors and analysts are bracing for much of the same.
RBC Capital Markets analyst Mark Mahaney expects an Ebitda loss of $802 million, or 89 cents a share, on revenue of $3.7 billion, up 26% from the same quarter a year ago. In a Nov. 1 note, he maintained an outperform rating on the stock with a price target of $62. Uber shares closed at $31.50 on Thursday.
Analysts surveyed by FactSet estimate a loss of 70 cents a share on revenue of $3.63 billion.
To be fair, Uber’s UBER, +0.13% second-quarter loss in August, equal to $4.72 a share, included $3.9 billion in stock-based compensation expenses related to its May IPO. But what was troubling to investors was the company’s slowest revenue growth rate yet — 14% to $3.17 billion.
The news was not encouraging on Wednesday, when rival Lyft Inc. LYFT, +2.92% reported a third-quarter net loss of $463.5 million, or $1.57 a share, versus losses of $249.2 million, or $11.58 a share, in the year-ago quarter. The red ink included $246.1 million of stock-based compensation and $86.6 million related to changes in insurance-related liabilities.
Uber’s stock is down 32% from its May 10 debut, while the S&P 500 index SPX, +0.72% has gained 22%.