Uber’s first profitable operating quarter could have been a fluke. The second one made me take the business more seriously. Q2 had already produced $326 million in income from operations. My original line calling Q3 the first profitable quarter was wrong.
Q3 income from operations rose to $394 million. Gross bookings reached $35.3 billion, up 21% from a year earlier, and trips rose 25%. Free cash flow was $905 million even after a $622 million cash outflow for a UK tax assessment. That’s more useful than treating the $221 million net-income figure as a clean measure of the ride business.
I had doubted that Uber could grow without perpetual losses. Two quarters of operating income made me revise that view. It still left the hard questions: how much of the improvement came from lasting trip economics, and how much would future insurance, labor, and platform spending consume? The S&P 500 addition reflected the change in scale. It didn’t answer the cost question.