Uber Technologies Inc. on Wednesday announced $20 billion in new stock buybacks in a significant move to return capital to shareholders after sharing a better-than-expected third-quarter forecast and quarterly results.
The results suggest that growth at its core rideshare and delivery units still has room to pick up steam, with Uber’s results likely to set expectations for the broader ride-hailing and food-delivery industries, with rideshare peer Lyft Inc. and delivery rival DoorDash Inc. both scheduled to report results after the close on Wednesday.
The company cited increased user frequency and said it has an opportunity to reach more consumers by cross-selling its rideshare and delivery services and adapting them to a wider range of customer needs. The gross bookings forecast for the current period represents an 18% to 21% growth rate, according to Bloomberg calculations, faster than the 17% gain in second-quarter bookings.
Announcing the buyback, Uber CFO Prashanth Mahendra-Rajah noted, “Today’s announcement of a new $20 billion share repurchase authorization underscores our confidence in the business, following yet another quarter of strong top and bottom-line performance.”
