Uber is facing pressure from Wall Street to turn a profit. The ride-hailing behemoth is finding a path to profitability by:
1. Exiting unprofitable markets
Uber recently abandoned its Eats business in India – selling it off to local rival Zomato.
Uber’s food delivery business had a minor 12% market share in the country and the Indian market was dragging the global margins down.
2. Focusing on markets where it can be the first or the second player
With the $2.65B acquisition of PostMates, Uber will increase its lead over Grubhub as the number two player in US – exactly what the company was aiming for.
Food-delivery market share before the PostMates acquisition –
DoorDash: 44%
Grubhub: 23%
UberEats: 23%
PostMates: 8%
Other: 2%
Uber is right now counting on UberEats to offset the huge losses it’s been experiencing since the start of covid-19.
While Uber’s ride-hailing business is struggling amid low demand, UberEats business has grown over 50% since March as people are now staying home and ordering takeouts.
Reference: TechCrunch
Photo Credits: Morning Brew/Unsplash
Prashant Bagga 