Summary
Uber Technologies, Inc. (UBER) announced strategic decisions regarding its Uber Eats operational footprint in an 8-K filing dated May 4, 2020. The company is discontinuing Uber Eats operations in seven markets: the Czech Republic, Egypt, Honduras, Romania, Saudi Arabia, Uruguay, and Ukraine, with these exits to be completed by June 4, 2020. Additionally, Uber Eats business operations in the United Arab Emirates (UAE) will be transferred to Careem, a wholly-owned subsidiary. These moves are part of Uber's strategy to focus on markets where it holds a leading position, either first or second, by concentrating investment in priority areas and exiting others. The affected markets represented a small but notable portion of Uber Eats' performance in Q1 2020, accounting for 1% of Gross Bookings and 4% of Adjusted EBITDA losses. Uber plans to reinvest the savings from these exits into markets with expected higher returns on investment. Uber Rides operations remain unaffected by these changes.
Key Highlights
- 1Uber is exiting Uber Eats operations in seven countries: Czech Republic, Egypt, Honduras, Romania, Saudi Arabia, Uruguay, and Ukraine, with closures by June 4, 2020.
- 2Uber Eats operations in the UAE will be transferred to Careem, Uber's subsidiary in the Middle East, with users transitioning to the Careem platform.
- 3These strategic decisions align with Uber's goal to be a top-ranked player ('first or second') in its Eats markets.
- 4The exited and transferred markets represented 1% of Eats Gross Bookings and 4% of Eats Adjusted EBITDA losses in Q1 2020.
- 5Uber intends to reallocate resources saved from these exits to priority markets with higher expected returns.
- 6Uber Rides operations are not impacted by these strategic changes to the Eats business.
- 7The filing includes forward-looking statements, and actual results may differ materially due to various risks, including the COVID-19 pandemic.