Uber released it third quarter earnings today, and though the company continues to lose money ($939 million in Q3), its food delivery business, Uber Eats, generated $2.1 billion in gross bookings (money collected before driver payouts), which is an increase of 150 percent over the same time period last year.
This is the first time Uber has broken out Eats’ earnings, and it’s easy to understand why. The company is expected to IPO next year, and it needs to shine a light on all the bright spots it can.
Uber Eats has been on a tear this past year: according to the company, it will reach 70 percent of the U.S. population by the end of 2018. Throughout the year, we’ve also seen Uber invest in the Eats division with the acquisitions of delivery only restaurant Ando, and restaurant POS software company orderTalk. It switched from imposing a flat delivery fee to charging on a sliding scale based on delivery distance. Earlier this month, the company launched Uber Eats for Business to help companies manage food delivery for employees.
But it’s not just about what Uber has done in the past. This earnings report helps illustrate how important Uber Eats will be to the company going forward. Uber CEO, Dara Khosrowshahi, has said that in ten year’s time, ride hailing will account for less than half of the company’s business, with services like Eats playing a larger role.
To that end, the company has been laying out some pretty big ideas for the future of moving food around. In October, Khosrowshahi indicated that delivering groceries would be a logical move for Uber (with $3.5 billion invested in food and grocery delivery startups this year, latecomer Uber’s competition will be fierce). Then, of course, later that month, an Uber job listing showed that the company wants to ramp up commercial drone delivery quickly (I still wish they would focus on delivery robots first, though).
As the company moves towards an IPO, we should expect to see more investment in Eats to keep that growth (and good earnings!) inertia going. Perhaps Uber should buy Smart Kitchen Summit Startup Showcase winner, Soggy Food Sucks, because being able to deliver crisp french fries is the kind of news Wall Street (and everyone, really) can rally around.