Uber posts first full-year operating profit as a listed company – business live

Time for a recap….

Here’s the rest of today’s news:

Back on Wall Street, the S&P 500 index has touched a new record high.

Materials, consumer discretionary, and energy stocks are leading the rally, as investors ponder how quickly US interest rates will be cut this year.

The recent earnings season has provided some support.

Robert Pavlik, senior portfolio manager at Dakota Wealth, says (via Reuters):

“So far, earnings have come in a little better than expected. It’s not outstanding, but certainly better than the negative numbers people were expecting.

Alex Lawson

Thames Water has been ordered to update its service commitment plan by the regulator Ofwat after a minister said the company’s performance in regards to sewage dumping and serving customers was “completely unacceptable”.

Robbie Moore, the floods minister, said Britain’s biggest water supplier was “under no illusions over the scale of the challenge” as MPs heard that Thames had allowed waterways to become polluted and homes to be flooded with sewage.

At a Westminster Hall debate on the performance of the company in Oxfordshire, Moore said:

“Ofwat have directed Thames Water to produce a service commitment plan.”

“This will require Thames Water to publicly commit to a plan for how they will start to turn their performance around. Please be assured that regulators and the government will be scrutinising these plans in detail to make sure every possible is being done to get the company back on track in terms of service delivery, environmental performance and ensuring that the customers get what they quite rightly deserve in terms of good supply.”

Wall Street traders don’t seem too impressed by Uber’s first annual profit since it floated five years ago.

Shares in the ride-hire and delivery company are down 2.5% in early trading in New York, at $68.65.

Ride-hire company Uber has reported its first full-year of operating profits since it floated on the stock market five years ago.

Uber has reported it made income from operations of $1.11bn in 2023, up from a loss of $1.832bn in 2022, beating expectations.

Revenues grew 17% last year, lifted by a 24% jump in trips in Uber vehicles.

“2023 was an inflection point for Uber, proving that we can continue to generate strong, profitable growth at scale,” said Dara Khosrowshahi, CEO, adding:

“Our audiences are larger and more engaged than ever, with our platform powering an average of nearly 26 million daily trips last year.”

Uber had consistently made an operating loss since debuting on Wall Street in May 2019. Losses rose from $3bn in 2018 to $8.6bn in 2019, before dropping to $4.86bn in 2020, $3.8bn in 2021 and then $1.832bn in 2022.

Profits last year were driven by higher demand for mobility bookings (ride hires) as well as deliveries (Uber Eats). Bookings grew by 8% quarter-on-quarter, while deliveries were 6% higher quarter-on-quarter.

Uber predicts that core profits and gross bookings will be strong in the first quarter of this year.

For Q1 2024, it predicts:

That would be an increase on the adjusted EBITDA profits of $1.283bn in Q4 2023, driven by $37.5bn of gross bookings in the last quarter.

Thomas Monteiro, senior analyst at Investing.com, says:

“It was a fantastic quarter for Uber, which shows that the long-term post-pandemic turnaround in the company is finally beginning to bear fruit. As we prepare for a faster-growth environment in the second semester of the year, particularly as financial conditions begin to improve, it is likely that the company will be perfectly positioned to lead the ride-hailing space in its quest for new innovations.

“The most positive point in this report for long-term investors was the company’s ability to show sustained improvement in its EBITDA margins and cash flows. This is likely to provide the company with serious competitive advantages going forward.

In 2022, a leak reported by the Guardian showed how Uber had broken laws, duped police and secretly lobbied governments as it rolled its services out.

Danish windfarm firm Ørsted to axe up to 800 jobs and pause dividend

Alex Lawson

The Danish company developing the world’s largest offshore windfarm in the North Sea is to cut hundreds of jobs and pause its dividend in an attempt to recover from a chaotic 12 months.

Ørsted, which is behind the £8bn Hornsea 3 project off the Yorkshire coast, said on Wednesday it planned to axe up to 800 jobs, pull back from markets in Spain, Portugal and Norway and suspend dividend payments to shareholders covering the 2023-25 financial years.

The company said it would cut its target for developing renewable energy capacity by 2030, reducing it from 50 gigawatts to 35-38GW.

Its chair, Thomas Thune Andersen, will step down after almost a decade in the role, following the two senior executives who left the business in November.

More here.

China has replaced the head of its securities regulator, according to the official Xinhua news agency.

The cabinet removed Yi Huiman as chairman of the China Securities Regulatory Commission (CSRC), as policymakers struggle to stabilise the country’s main stock indexes after a plunge to five-year lows.

Yi has been replaced by Wu Qing, a veteran securities regulator who had led the Shanghai Stock Exchange and served as a key deputy in Shanghai’s municipal government, Xinhua said.

Shares on China’s stock exchanges in Shanghai and Shenzhen dropped to their lowest levels since 2019 last week, despite recent reports that Beijing policymakers could use billions of yuan at state-owned enterprises to reverse a recent share rout.

Problems in China’s property sector have weighed on the market, as have fears of new trade tensions with the United States if Donald Trump wins the presidential election.

The downturn in Germany’s industrial economy continued at the end of last year, new data shows.

German industrial production fell by 1.6% month-on-month in December, and was 3% lower than a year ago.

ING say German industry remains stuck between cyclical and structural weakness, adding:

The Christmas vacation might have exaggerated the December plunge, but even with some potential data revisions, the picture of one of the worst years for German industry will not change.

For example, production in the chemical industry in 2023 was at the lowest level since 1995.

The only ‘vague light at the end of a very long tunnel” is that data yesterday showed a rise in German industrial orders in December, which should lead to higher output in 2024.