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Uber Freight’s EBITDA barely positive in Q3

After posting $5 million in Q2, EBITDA shrinks to just $1 million in 3rd quarter

Photo: Uber Freight

Quarter-to-quarter comparisons on the financial performance of digital brokerage Uber Freight are limited in their value now, as the review would be looking at Uber Freight before it acquired Transplace and Uber Freight after the deal was closed just about a year ago.

But sequential comparisons are significant. And by one measure, Uber Freight, with Transplace now fully in the fold, did worse in the third quarter than it did in the second: EBITDA.

Uber Freight turned in a positive EBITDA in the second quarter of $5 million. But that declined to $1 million in the recently concluded third quarter.

Company executives have long pushed EBITDA as a leading indicator of the strength of Uber’s activities. EBITDA at Uber Freight in the first quarter was $2 million.

The drop in that measure of financial performance came as Uber Freight’s sequential revenue declined to $1.75 billion in the third quarter from $1.83 billion in the second quarter.

In the few comments about Uber Freight’s performance within the broader earnings release of Uber Technologies (NYSE: UBER), the company said it had “record transportation management performance.” Although the statement did not refer to Transplace directly, transportation management is the core of the legacy Transplace business that Uber Freight acquired last year. 

Transportation management at Uber Freight “delivered record … performance on a trailing-twelve-month basis with our largest ever annual deal value won, highest ever win-rate, and largest ever forward pipeline.”

“Use cases for [transportation management] solutions continue to grow amidst supply chain headwinds, as shippers look to efficiently manage, plan and procure within their freight network,” the statement said.

The scope of the increase in revenue at Uber Freight as a result of the Transplace acquisition can be seen partly in the quarterly comparisons. The Uber Freight division with Transplace recorded revenue of $1.75 billion in the quarter ended Sept. 30. A year ago, that number was $402 million. The increase can not all be attributed to Transplace because it is not known what percentage of revenue this year came from the online brokerage activities of legacy Uber Freight and revenue posted by legacy Transplace business.

Uber Freight was not mentioned during the company’s call with analysts after the release of its earnings.

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John Kingston

John has an almost 40-year career covering commodities, most of the time at S&P Global Platts. He created the Dated Brent benchmark, now the world’s most important crude oil marker. He was Director of Oil, Director of News, the editor in chief of Platts Oilgram News and the “talking head” for Platts on numerous media outlets, including CNBC, Fox Business and Canada’s BNN. He covered metals before joining Platts and then spent a year running Platts’ metals business as well. He was awarded the International Association of Energy Economics Award for Excellence in Written Journalism in 2015. In 2010, he won two Corporate Achievement Awards from McGraw-Hill, an extremely rare accomplishment, one for steering coverage of the BP Deepwater Horizon disaster and the other for the launch of a public affairs television show, Platts Energy Week.