High gas prices and rising geopolitical tensions have done little to slow U.S. consumer growth, at least judging by the latest results and comments from Uber Technologies and the Walt Disney Company.
The companies pointed to a marked recovery in consumer spending, with consumers continuing to pay big bucks for rides, food deliveries, vacations and trips to theme parks, even as oil prices rise and widespread concerns about the economy persist.
Uber stock rose nearly 10% in premarket trading, while Disney shares soared 5%.
“We’ve been looking closely at consumer patterns. Are people taking shorter trips? Are people cutting prices in terms of the size of their grocery cart, so to speak? Are consumers tipping as much as they used to depending on the type of restaurant they’re eating at? All of these metrics continue to be very strong,” Uber CEO Dara Khosrowshahi said Wednesday on CNBC’s “Squawk Box.” “Consumers are spending, they are spending locally, and there are no signs of slowing down right now.”
At Uber, delivery remained the company’s fastest-growing business in the latest quarter, with revenue up 34% to $5.07 billion from $3.78 billion in the year-ago period. Ride-hailing segment revenue rose 5% to $6.8 billion as commuting activity and local spending remained strong.
Khosrowshahi said Uber continues to see consumers leaving their homes more frequently, driven in part by a trend back to the office that has boosted demand for commuting. The company currently employs more than 10 million people around the world, including drivers and delivery workers.
The same resilience was evident at Disney, where the entertainment giant exceeded Wall Street expectations on the strength of its streaming and parks businesses.
Disney’s experiences division, which includes theme parks and cruises, reported quarterly sales of nearly $9.5 billion, up 7% from a year earlier. Global attendance increased by 2% even as domestic park visitor numbers fell by 1%.
“Current demand at our domestic parks and resorts is healthy,” Disney said in its financial results. “While we recognize the potential impact of increased global macro uncertainty on consumers, we expect to see year-over-year improvement in domestic park attendance in the third quarter compared to second quarter results, driven by current demand.”
Uber and Disney’s results defied expectations that consumer spending would slow as gas prices soared and investors worried that rising energy costs would eventually squeeze household budgets.
According to AAA data, the national average price of regular gasoline rose to $4.54 per gallon, a 52% increase since the start of the war. Diesel prices similarly rose to $5.67 per gallon, an increase of about 51% since late February.
But so far, businesses related to travel, entertainment and local commerce are showing little sign of a setback.
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