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Uber losses mount even as it expands delivery business

A strong showing from Uber’s delivery service has not helped to offset huge losses amid dwindling demand for rideshares.

The ride-hailing app has faced huge setbacks as lockdown restrictions all but decimated its core business. In the third quarter the company posted losses of more than £1bn and revenue also missed analysts’ estimates.

Uber reported a loss of $454m loss in the fourth quarter, slightly lower than analysts’ average expectations for a $514m loss.

It reported a 52 per cent decline in fourth-quarter mobility revenue to $1.47bn in the previous year, but it represents a huge turnaround for the app. In the second quarter, Uber’s Ride bookings fell a staggering 75 per cent.

Shares are down 2.6 per cent in after-hours trading having climbed six per cent during the day. Rival Lyft’s shares jumped earlier after it said it is cutting costs and expects to be profitable in the third quarter.

Uber’s delivery division has done some heavy lifting with revenue tripling year-over-year to $1.36bn, and grew 19 per cent on the previous quarter.

It has expanded further into the space acquiring food-delivery service Postmates for $2.65bn and booze delivery service Drizly for $1.1bn.

“While 2020 certainly tested our resilience, it also dramatically accelerated our capabilities in local commerce, with our Delivery business more than doubling over the year” chief executive Dara Khosrowshahi said.

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IDFIMH

It doesn't matter as long as they are EXPANDING then investors get rich and don't lose money

there will be no stopping uber until they have expanded so much that there is little or no prospect of growth

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And now they take on DHL and fed ex perfect for the drugs trade

Uber are set to enter the UK parcel delivery industry via its current network of drivers with the promise of same day deliveries in certain areas.

The taxi app is aiming to generate new revenue schemes within its existing infrastructure after experiencing a significant decline in demand due to the ongoing Covid-19 lockdown.

Their Uber Eats service has felt a sharp upturn in sales and requests due to restaurants across the UK only able to offer takeaway services in recent months.

However, the company is reacting to lack of demand for travelling passengers, with the launch of the Uber Connect pilots in Leeds, Birmingham and Manchester from February 11.

Customers can make a booking for an item to be delivered via the normal Uber app, with drop off priced at the same rate as a taxi trip, with package tracking and notifications also available.

The US-based company are confident the initial roll out can be transferred into a nationwide project later in 2021, following the example of similar Uber Connect systems set up in Australia, Mexico, Canada and the US last year.

“Daily life remains very different this year and we want to help people keep in touch while staying safe at home as lockdown continues,” said Jamie Heywood, regional general manager for Northern and Eastern Europe at Uber.

“Uber Connect means you can send that last minute gift you accidentally forgot, share a book you loved with one of your friends, or documents for a work colleague.”

Specifications of the service include the sender being required to contact the recipient regarding the expected delivery, with the item weighing nor more 13kg and the contents costing less than £100, and restrictions on prohibited items.

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It is ironic that their first successful trial of this was in Medellin !

clearly the rest of the business isn't expanding rapidly enough to maintain the Ponzi scheme so now drug couriering is being tried although I'm sure a few legal parcels will also use the system

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