Uber’s delivery business is now bigger than its ride hailing business. Uber on Wednesday reported widening losses even as trips and deliveries grew as driver incentives hit revenue. Uber said riders returned to its platform in greater numbers in July and it expects the trend to continue in the coming months, together with strong growth in food delivery orders.
Investors are worried about the ongoing shortage of drivers in the industry as demand ramps up. Lyft on Tuesday said it expected limited driver supply to continue. Uber said monthly active drivers and food delivery workers had increased by 50%, or by nearly 420.000 drivers from February 2021 to July 2021.
Uber’s delivery unit narrowed losses and more than doubled gross bookings from last year as a result of acquiring rivals Postmates and last-mile alcohol delivery company Drizly. Uber is also expanding in grocery delivery having announced partnerships with Albertsons Companies Inc and Costco Wholesale Corp.
Uber also announced the acquisition (by Uber Freight) of logistics company Transplace for US$ 2,25 billion, which is now expected to break even on an EBITDA basis by the end of 2022.