"This is an aggressive move by Uber to take out a competitor on the Uber Eats front and further consolidate its market position, especially as the COVID-19 pandemic continues to shift more of a focus to deliveries vs. ride-sharing in the near-term," Dan Ives, an analyst at Wedbush Securities, said in a note to clients about the deal, which is expected to close in the first quarter of 2021, pending approval from US regulatory agencies and Postmates shareholders.
On a conference call Monday morning, Uber said its eats business is now profitable on an EBITDA basis, an adjusted financial metric, in many markets. The combined businesses will be able to significantly cut costs, Khosrowshahi said, helping Uber reach overall profitability — something its worked towards for years, but never achieved. Postmates will remain a separate consumer app, and Uber declined to share any detail's on the company's finances.
Uber specifically cited a strong userbase of young people and millennials on Postmates that it will gain as part of the deal. "Over the past eight years we have been focused on a single mission: enable anyone to have anything delivered to them on-demand," Postmates Co-Founder and CEO, Bastian Lehmann, said in the press release.
"Joining forces with Uber will continue that mission as we continue to build Postmates while creating an even stronger platform that brings this mission to life for our customers. Uber and Postmates have been strong allies working together to advocate and create the best practices across our industry, especially for our couriers."Axel Springer, Insider Inc.'s parent company, is an investor in Uber.
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