Uber Stock Surges 38% as CEO Claims Worst of Pandemic Impact Has Passed
Uber shares skyrocket after CEO Dara Khosrowshahi assures investors the company has enough cash to survive the crisis and points to growing food delivery demand.
Uber and Lyft shares skyrocket on Thursday after Uber's CEO Dara Khosrowshahi tells investors the company has plenty of cash to survive the coronavirus crisis. Uber stock closes up 38.26% at $20.49 per share, while competitor Lyft sees a 28.97% boost without releasing any new pandemic updates. The massive surge follows a week where Uber stock hits all-time lows as investors treat the company more like a travel business than a tech platform.
Despite a massive 60% to 70% drop in ride bookings in heavily impacted areas, Khosrowshahi says the worst of the pandemic's impact is already behind them. As health officials urge people to stay home and restrict restaurant dining, Uber Eats experiences significant growth. The CEO notes that the food delivery segment serves as a crucial resource right now, with the service still expanding even in hard-hit cities like Seattle.
Uber declines to update its financial guidance due to the fluid nature of the pandemic, but emphasizes its ample liquidity to weather the storm. The company still plans to reach profitability by the fourth quarter of 2020, building on previous targets set before the global health emergency. Khosrowshahi remains optimistic, stating that once people start moving again, Uber will move right alongside them.