Currently $78.11, 7% up on the day, but 20% down on the year high.
Uber hit by Middle East conflict despite strong bookingshttps://www.ft.com/content/da045c04-d3e ... 25a6b1a6=1Uber posted weaker than expected revenues for the first quarter as its mobility business was buffeted by conflict in the Middle East, but the ride-hailing app set an optimistic outlook with a growing paid membership base.
The San Francisco-based company said on Wednesday that revenues in the first quarter were $13.2bn, slightly below analysts’ estimates of $13.3bn. The knock to its ride-hailing arm was offset by outperformance in the group’s food delivery business.
Uber also said its revenues took a $1bn hit from changes to its business model following a revamp in tax law in the UK that came into effect at the start of this year. It warned that it expected a similar “headwind to revenue” of about $1bn per quarter for the rest of the year.
Uber’s shares jumped as much as 9 per cent in pre-market trading as it forecast better than expected customer spending and profits for the current quarter.
Dara Khosrowshahi, Uber’s chief executive, told investors in prepared remarks that the business had started the year in a strong position “despite a complex macro backdrop” with volatile fuel prices, geopolitical uncertainty and the US experiencing severe weather disruption.
Uber has big ride-hailing businesses in Saudi Arabia and the United Arab Emirates, where major cities have been hit by Iranian attacks since the US and Israel’s war began at the end of February.
The group is not alone in warning investors that it has been affected by the conflict. Rising oil prices have knocked consumer confidence and put discretionary spending under pressure.
Uber has moved aggressively in the past year to compete on price against rivals. It has used discounts to drive bookings and uptake of its Uber One membership scheme, which surpassed 50mn users for the first time in April.
Gross bookings — a measure of customers’ total spending across all its business units — rose 25 per cent year on year in the three months ending on March 31 to $53.7bn, exceeding analysts’ estimates of $52.9bn.
Uber forecast adjusted earnings for the second quarter of 2026 of between $2.7bn and $2.8bn, compared with analysts’ estimates of $2.66bn, according to S&P Visible Alpha. It also projected gross bookings of $56.25bn to $57.75bn, ahead of Wall Street’s previous expectations.
The UK business model changes, which only apply outside London, follow a change in how taxi fares are taxed, which was introduced in November’s Budget.
Uber’s drivers now contract directly with passengers, with Uber acting as an “agent”, allowing the company to shift the expanded VAT liability on to drivers but meaning it recognises a smaller portion of the total fare as its own revenue. Uber remains the “merchant” in London and so is responsible for VAT in its largest British market.
Uber’s chief financial officer Balaji Krishnamurthy said the change was largely an accounting difference that “has no impact on underlying economics”.
Khosrowshahi has been seeking to expand the scope of Uber’s services as he doubles down on a “super app” push, having already tapped food delivery, groceries and shopping. Uber last month unveiled a partnership with Expedia at its annual Go-Get event in New York.
Uber’s net profit for the first quarter was $263mn, weighed down by a $1.5bn “headwind” from its various equity stakes. The company has invested in several publicly listed companies whose shares have slid in the past year, including Singapore-based Grab and China’s DiDi.
The group has been pushing to deploy autonomous vehicles on its network and plans to operate services in at least 15 cities this year. It has committed to spend in excess of $10bn to support the rollout of AV fleets, the FT previously reported.
Like many tech companies, Uber has seen its spending on AI tools rise faster than expected, following the arrival of new and more capable models such as Anthropic’s Claude Code late last year.
“We’re seeing the use of AI just grow at unbelievable rates,” Khosrowshahi said, adding that about 10 per cent of Uber’s code is now written by AI agents.
Krishnamurthy said Uber had “re-upped our investment” in AI. “Candidly, when we set our budgets for 2026 in November, we underestimated the amount of impact the AI tools could have,” he said.
Khosrowshahi brushed off concerns from investors that AI agents could be a threat to Uber’s business, referencing historic fears that online travel companies such as Expedia and Booking.com would be cut out by search engines.
“AI is going to power entirely new experiences but we think the majority of those experiences are going to come direct to us,” he said.
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