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Is a Beat Likely for UBER in Q3 Earnings on Mobility Recovery?

UBER's Q3 performance is expected to have benefited from strong Delivery revenues and higher Mobility revenues on the back of improved ride volumes.

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This story originally appeared on Zacks

Uber Technologies UBER is scheduled to report third-quarter 2021 earnings numbers on Nov 4, after market close.



Let’s take a look at factors that are expected to have influenced the company’s third-quarter performance.



With improvement in ride volumes from the pandemic-driven lows, the company’s third-quarter performance is expected to have benefited from higher Mobility revenues. The Zacks Consensus Estimate for Mobility revenues indicates a 54.3% jump from the year-ago reported number.



Akin to the past quarters, the Delivery segment’s performance is expected to have been robust in the third quarter on the back of higher online order volumes. The Zacks Consensus Estimate for Delivery revenues in the third quarter hints at a 34.9% surge from the third-quarter 2020 reported figure.



Uber has witnessed strong improvements in Mobility and Delivery adjusted EBITDA during the third quarter, owing to which the company expects adjusted EBITDA loss between negative $25 million and positive $25 million for the third quarter. This implies that the company might have recorded adjusted EBITDA profits in the third quarter itself, which is earlier than its previous expectation of achieving the same in the fourth quarter of 2021.



However, the third-quarter performance might have been partly hurt by costs incurred to cater to the recovery in Mobility operations, such as an expected increase in sales and marketing expenses, and general and administrative expenses, as well as investments on drivers.

- Zacks

Uber Technologies, Inc. Price and EPS Surprise

Uber Technologies, Inc. Price and EPS Surprise

Uber Technologies, Inc. price-eps-surprise | Uber Technologies, Inc. Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Uber this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. You can see the complete list of today’s Zacks #1 Rank stocks here.



Earnings ESP: Uber has an Earnings ESP of +16.33% as the Most Accurate Estimate is pegged at a loss of 32 cents, while the Zacks Consensus Estimate is poised at a loss of 38 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.



Zacks Rank: Uber carries a Zacks Rank #3.

Highlights of Q2 Earnings

Uber reported second-quarter 2021 earnings of 58 cents per share against the Zacks Consensus Estimate of a loss of 53 cents. Total revenues of $3,929 million outperformed the Zacks Consensus Estimate of $3,740.3 million. The top line rose significantly year over year (improved 35% sequentially), primarily due to recovery in its mobility operations.

Other Stocks to Consider

Investors interested in the broader Computer and Technology sector may also consider Lyft LYFT, T-Mobile US TMUS and HubSpot HUBS, as these stocks too possess the right combination of elements to beat on earnings this reporting cycle.



Lyft has an Earnings ESP of +11.77% and a Zacks Rank #2. The company will release third-quarter 2021 earnings numbers on Nov 2.



T-Mobile has an Earnings ESP of +11.39% and a Zacks Rank #3. The company will announce third-quarter 2021 financial numbers on Nov 2.



HubSpot has an earnings ESP of +1.49% and a Zacks Rank #3. The company is set to release third-quarter 2021 results on Nov 3.



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