Uber Bids Farewell to Drizly Alcohol Delivery Service in Major Business Strategy Shift
Portfolio Pulse from Anusuya Lahiri
Uber Technologies Inc (NYSE:UBER) is discontinuing its alcohol delivery service, Drizly, by March 2024, as part of a strategic shift to streamline its delivery services. The service was acquired for $1.1 billion during the pandemic when delivery services surged due to a decline in Uber's core ridesharing business. Uber aims to consolidate consumer access to food, groceries, and alcohol through Uber Eats. Despite the closure of Drizly, Uber's third-quarter gross bookings exceeded expectations, with an 11% year-on-year revenue increase, although it fell short of projections.
January 16, 2024 | 12:23 pm
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NEUTRAL IMPACT
Uber is ending Drizly alcohol delivery to integrate services into Uber Eats. Q3 revenue rose 11% YOY to $9.29B, missing estimates. Shares dipped 0.73% premarket.
The closure of Drizly is a strategic move to simplify Uber's offerings, which could be seen as a positive step towards efficiency. However, the missed revenue expectations for Q3 and the premarket dip in share price suggest a neutral to slightly negative short-term impact as the market absorbs the news and assesses the effectiveness of Uber's consolidation strategy.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100