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Uber is losing less money. But it still faces one big risk

uber-is-losing-less-money.-but-it-still-faces-one-big-risk

A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here.

London (CNN Business)The pandemic has been a tough time to be in the business of shuttling people from Point A to Point B.

For months, government rules and fears about catching Covid-19 meant everyone stayed put. Finally, though, there are signs of change — and Uber (UBER), for one, is thrilled.

“Uber has already begun to fire on all cylinders,” CEO Dara Khosrowshahi told analysts after the company reported earnings Wednesday.

    What’s happening: As the economic recovery picked up in key markets like the United States, the startup reported a net loss of $108 million for the first three months of the year. That’s a dramatic improvement from the $968 million loss it posted during the final three months of 2020.

      The company’s core ride-hailing business still looks weak, with gross bookings for rides down 38% compared to a year earlier. But major growth in food delivery, which saw bookings jump 166% compared to the same period in 2020, is helping Uber weather the storm.

      Even as customers return to the app, however, there’s significant uncertainty over Uber’s relationship with its drivers.

      See here: Driver supply has been a problem recently as the company tries to convince people it’s safe to start ferrying riders around again. Khosrowshahi said the company is offering incentives to get old drivers back on the road and to find new recruits.

      “There’s a greater hesitation for some drivers to come on board to drive other people versus, again, [driving] food,” Khosrowshahi said.

      The longer-term problem is how Uber compensates its workers.

      Earlier this year,

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