Higher gasoline prices and mounting geopolitical tensions are doing little to slow the American consumer — at least judging by the latest results and commentary from Uber Technologies and The Walt Disney Company.
The two companies pointed to a remarkably resilient spending backdrop, with consumers continuing to shell out for rides, food delivery, vacations and theme park trips even as oil prices climb and broader concerns about the economy linger.
Shares of Uber jumped more than 8%, as Disney shares popped over 6%.
“We watched consumer patterns really closely. Are people taking shorter trips? Are people trading down in terms of the size of their grocery basket, so to speak? With the kinds of restaurants that they’re eating at, are consumers tipping as much as they were? All of those indicators continue to be really strong,” Uber CEO Dara Khosrowshahi said on CNBC’s “Squawk Box” Wednesday. “The consumers are spending, they’re spending locally, and we don’t see any signs of that weakening at this point.”
At Uber, delivery remained the company’s fastest-growing business in the latest quarter, with revenue jumping 34% to $5.07 billion from $3.78 billion a year earlier. Revenue in the ride-hailing division rose 5% to $6.8 billion as commuting activity and local spending stayed strong.
Khosrowshahi said Uber is seeing consumers continue to leave their homes more frequently, helped in part by a return-to-office trend that has boosted commuting demand. The company now has more than 10 million earners on its platform globally, including drivers and delivery workers.
The same resilience showed up at Disney, where the entertainment giant topped Wall Street expectations on the strength of its streaming and parks businesses.
Disney’s experiences division, which includes theme parks and cruises, posted nearly $9.5 billion in quarterly revenue, up 7% from a year earlier. Global attendance rose 2%, even as domestic park visitation slipped 1%.
“Current demand at our domestic parks and resorts is healthy,” Disney said in its earnings materials. “While we acknowledge the potential impact of heightened global macro uncertainty on consumers, we are encouraged by current demand and expect year-over-year attendance at our domestic parks in Q3 to show improvement compared to Q2 results.”
The results from Uber and Disney defied expectations for a slowdown in consumer spending as gasoline prices surge and investors worry that rising energy costs could eventually squeeze household budgets.
The national average price for regular gasoline has climbed to $4.54 a gallon, up 52% since the war began, according to AAA data. Diesel prices have similarly surged to $5.67 a gallon, a roughly 51% increase since late February.
But so far, these companies tied to travel, entertainment and local commerce are seeing little evidence of a pullback.
Disney Chief Financial Officer Hugh Johnston cautioned that the company is still watching for signs that persistently higher fuel costs could eventually pressure consumers.
“We’re mindful of the macro uncertainty consumers are facing and we’re not immune to the impacts, including how a significant further rise in fuel prices from current levels could eventually lead to changes in consumer behavior,” Johnston said on the earnings call Wednesday. “If that possibility were to occur, each business has levers in place to make adjustments in order to offset those kinds of macro pressures.”