This was expected to be a slow week for corporate earnings after a long holiday weekend. Uber Technologies Inc.
decided to shake things up, though.
The ride-hailing service announced just a week ahead of time that it expects to report quarterly earnings for the first time since its monstrous initial public offering. Coming Thursday, that will be a closely watched report, as the stock has failed to trade higher than the $45 pricing level of its initial offering and has attracted short sellers. Shares closed Friday at $41.51.
Uber disclosed ahead of the IPO that it expected to lose at least $1 billion in the first quarter, with net revenue of $3.04 billion to $3.10 billion. In the year-ago quarter, Uber reported massive earnings of $3.75 billion on revenue of $2.58 billion, though that outsized profit was linked to the sale of some of its international operations, with a stated operational loss of about half a billion dollars in the year-ago quarter.
Uber’s losses will be monstrous, and it won’t even be because of the IPO. While stock-based compensation can cause huge GAAP losses after an IPO, the quarter Uber will report closed on March 31, well before the company’s stock sale. So Uber earned all the losses it will report on Thursday.
The most interesting number to look for in Uber’s maiden results is gross bookings, a metric that discloses all the money paid for Uber services, including the part that goes to drivers and other workers on the platform. Rival Lyft Inc.
stopped providing that figure in its post-IPO earnings, instead just reporting net revenue collected by the company.
Uber said in its pre-IPO disclosure that it expected gross bookings of $14.44 billion to $14.66 billion, with about 78% of that total attributed to its ride-sharing platform and most of the rest coming from the Uber Eats food-delivery business. On Thursday, we will see if Uber lives up to that estimate or decides to join its rival in opting not to bother reporting it.
Beyond Uber, there is little intrigue in this week’s earnings slate, as no Dow Jones Industrial
components and only nine S&P 500
companies are expected to report. There are some intriguing smaller companies set to report, however, starting with some that operate outside of federal law.
A host of U.S. pot companies expect to report quarterly earnings during the week, including one of the most prominent multistate operators and one that could seek to claim greater legality than its counterparts in the business.
While marijuana is still an illegal controlled substance in the eyes of the federal government, one of its components is largely avoiding scrutiny. Cannabidiol, or CBD, is a nonintoxicating substance that can be derived from hemp, which was legalized by Congress late last year. That has led to an explosion in CBD offerings, even though their legality and efficacy are not certain.
Charlotte’s Web Holdings Inc.
specializes in CBD, and is one of the largest U.S. companies to do so. The company already released preliminary results, which showed revenue growth of about 70%, though quarterly sales are still lower than a $100 million annual run rate. The stock has fallen more than 25% in the past month, as some investors may have expected a quicker ramp-up after the passage of the federal farm bill — the quarter that Charlotte’s Web is expected to report Tuesday afternoon is the first since that bill became law — and insider stock sales may have spooked some other shareholders. The company’s conference call is scheduled for Wednesday.
MedMen Enterprises Inc.
is a prominent U.S. pot company with retail stores in six states and a taste for advertising, as anyone who has hailed a cab in Las Vegas this year could tell you. The company, which already released preliminary results, has changed chief financial officers and other top executives this year, so watch for any big changes in its accounting procedures and processes when it reports Wednesday.
Keep up to date with the cannabis industry with Cannabis Watch
Curaleaf Holdings Inc.
, one of the largest U.S. pot companies by market cap, will report Thursday after striking a deal for a prominent brand of marijuana products. Acreage Holdings Inc.
will report results Wednesday as it approaches a shareholder vote on its groundbreaking acquisition by Canadian heavyweight Canopy Growth Corp.
. U.S.-based Cresco Labs Inc.
is expected to report Wednesday, with its Canadian acquisition target, CannaRoyalty Corp.
, Trulieve Cannabis Corp.
, Emerald Health Therapeutics Inc.
and Green Thumb Industries Inc.
among the other cannabis companies on the docket for the week.
Otherwise, the week will offer continued retail returns and the start of a wave of software earnings.
Dollar Tree Inc. and Dollar Tree Corp. are expected to report Thursday morning, while Costco Wholesale Corp.
, Gap Inc.
and Ulta Beauty Inc.
are expected to report that afternoon. That follows a string of prominent retail reports last week, including reports from Home Depot Inc.
and Best Buy Co.
Software companies typically rule tech-sector earnings in the final month of the quarter, and that run kicks off this week with Workday Inc.
, Palo Alto Networks Inc.
, VMWare Inc.
, Zscaler Inc.
, Okta Inc.
and Nutanix Inc.
expected to report. Elsewhere in tech, results are on the docket from Dell Technologies Inc.
and Marvell Technology Group Inc.