Uber now hopes to be profitable by the end of this year, and growing Uber for Business will be one driver toward that new goal, executives said in an earnings call.
Fourth-quarter gross bookings from Uber rides increased 18% year over year to $13.5 billion, and Uber for Business accounted for $1.2 billion in the quarter. Revenue from managed business accounts was up 75 percent year over year, according to Uber.
While Uber reported a loss of $1.1 billion for the quarter -- compared with an $887 million loss in the fourth quarter of 2018 -- it was narrower than projected. CEO Dara Khosrowshahi said the company would see losses "continue to decline" this year with a new goal of profitability by the fourth quarter of 2020. Previously, Uber had set the goal to reach profitability by the full year of 2021.
"With many of the one-time changes from 2019 behind us, we're excited to sharpen our focus on execution to grow our business at massive scale, innovate faster than anyone else, improve margins considerably, allocate our capital effectively and efficiently and do the right thing for all of our constituencies," Khosrowshahi said.
Part of Uber's strategy is cutting out what Khosrowshahi called "empty calories" in terms of bookings, such as de-emphasizing shared rides. Uber for Business, however, provides a higher revenue premium, so Uber will be investing to make it a higher percentage of its business globally, he said.
"We are going to be investing relatively heavily in growing the Uber for Business sales force," Khosrowshahi said. "We have a more mature and larger sales force in the United States versus Europe and some of the other countries."
High-priority markets for Uber include Argentina, Germany, Italy, Japan, South Korea and Spain, he said. Gross bookings in those markets during the fourth quarter were up by four times the rate of overall gross bookings.
Source: Business Travel News