Shares in Uber Technologies Inc. dropped in after-hours trading today after the ride-hailing giant reported impressive figures that were slanted by onetime profits in its second-quarter earnings.

For the quarter ended June 30, Uber reported $3.93 billion in revenue, more than double of what it did in the same quarter of 2020. Gross bookings grew 114% year-over-year to $21.9 billion. Net income came in at $1.1 billion, including $272 million in stock-based compensation expense. Earnings per share came in at 58 cents.

Analyst had expected revenue of $3.75 billion and a loss of 51 cents per share.

There was a catch given what has happened since the end of the quarter. Uber said that net income benefited from unrealized gains of $1.4 billion from its stake in Didi Global Inc. Uber owns shares in Didi after selling its China operations to Didi in 2016.

Didi went public in the U.S. on June 30 and then the Chinese Communist Party got involved. Didi had its app banned in mainland China and then it just kept getting worse for the company. Uber is accurate in reporting the gain in the quarter but Didi shares have dropped ever since. According to CNBC, Uber’s shareholding in Didi dropped by $2 billion in the last week.

A further on paper profit was listed as $272 million from Uber’s stake in autonomous vehicle startup Aurora Innovation Inc. Uber gained a 26% share in the company after selling its autonomous vehicle division to Aurora in December. Aurora announced on July 15 that it plans to go public via a special purpose acquisition company. For Uber’s bottom line, it’s unlikely to go pear-shaped in a similar manner to what has occurred with Didi.

Putting aside the on-paper profit, Uber’s adjusted loss before interest, taxes, depreciation and amortization was $509 million, up $150 million from the previous quarter but an improvement of $328 million compared with the same quarter in 2020.

Uber’s food delivery business continues to dominate its gross bookings numbers. Delivery came in at $12.91 billion in the quarter, up 85% year-over-year. Mobility, Uber’s ride-hailing business, saw 184% growth compared to the same quarter in 2020 with $8.64 billion in gross bookings.

The company noted that it had made strong progress in the quarter in luring drivers and couriers back to its business as the worst of the COVID-19 pandemic in western countries has passed.

“The majority of drivers who are coming back to the platform are what we call resurrected drivers; they’ve driven with us in the past,” Uber Chief Executive Officer Dara Khosrowshahi said during an earnings call. “As vaccination rates go up, we are seeing the resurrected drivers come back.”

Uber Chief Financial Officer Nelson Chai also noted on the call that Uber is still on track to reach profitability on an adjusted  basis by the end of the year. “As we make progress towards that important milestone, we expect our Adjusted EBITDA loss in Q3 to improve to less than $100 million in addition to record Gross Bookings between $22 and $24 billion,” Chai said.

Investors saw that the otherwise impressive net income figure from Uber was based on Didi shares. Uber shares dropped 4.7% in after-hours trading.

Photo: Yuya Tamai/Flickr