Uber Technologies (NYSE:UBER) traded lower in pre-market trading on Wednesday after issuing third-quarter earnings guidance that came in below Wall Street expectations, despite reporting solid second-quarter operating performance.
The weaker outlook overshadowed stronger-than-expected gross bookings during the latest quarter and renewed investor focus on the company’s investment plans.
Third-quarter EPS forecast misses consensus
Uber expects adjusted earnings per share for the third quarter to range between $0.84 and $0.88, below analysts’ consensus estimate of $0.89, according to LSEG data cited by Reuters.
The company also warned that foreign exchange headwinds are expected to reduce gross bookings growth by approximately one percentage point compared with the prior year.
Management forecast third-quarter gross bookings of between $58.25 billion and $60.25 billion, compared with analysts’ expectations of $59.21 billion.
World Cup boosts second-quarter bookings
During the second quarter, Uber generated gross bookings of $58.02 billion, exceeding market expectations.
Chief Executive Officer Dara Khosrowshahi said demand benefited significantly from the FIFA World Cup, with increased travel across the United States, Canada and Mexico driving higher usage of Uber’s services in host cities.
Revenue rises despite accounting impact
Second-quarter revenue increased 12% year over year to $14.19 billion.
However, the figure fell slightly short of analysts’ forecasts after an accounting rule change in the United Kingdom weighed on reported revenue growth.
Autonomous vehicle investment remains a key focus
Uber also announced plans to invest more than $10 billion in autonomous vehicle technology over the coming years, although it did not provide a detailed timeline for those investments.
Capital allocation has become an increasingly important topic for investors following the company’s $14.8 billion acquisition of Delivery Hero in July.
Uber has previously stated that the transaction will be financed through existing liquidity and additional debt.
Uber Technologies stock price
