Uber Eats surpassed its quarterly expectations but why did it do so well?
Chequered history: Uber has had an interesting history since launching around 11 years ago. First it was the fast-growing Sillicon Valley tech darling. Then it was the fast-growing Sillicon valley tech devil (with a bad reputation for misogyny).
What's profit?: Uber is now a public company is allergic to profits. In fact, Uber lost $140 million in the first 3 months of this year.
UberEats carrying the business: Uber’s food delivery service improved revenue by 166% over the quarter, while Uber's ride sharing business declined 38%.
Uber hedged. A 'hedge' is an investment that is made with the intention of reducing risk. And usually, a hedge consists of taking an offsetting or opposition position. A bit like a bet 'each way.'
Uber's rideshare and food delivery businesses naturally hedged against each other during COVID (and actually complemented each other extremely well).
Uber's businesses worked together like a team. The ride sharing business did not perform well during worldwide lockdowns. But Uber's food delivery business performs extremely well when we can't leave the house.
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