Ride hailing competition takes a toll: Uber competitor's profit significantly decreases due to protracted legal disputes
Uber and Bolt, two of the leading transportation service providers, have faced a series of financial and legal challenges in the UK market.
In the latest financial year, Uber's revenue surged by over £1bn, a significant increase. However, the company's pre-tax profit in the UK declined from £29.3m to £21.6m during the same period. The warning of potential unprofitability in the UK was included in Uber's latest financial accounts for 2024, filed with Companies House.
Meanwhile, Bolt, headquartered in Estonia and founded by Markus Villig in 2013, has been grappling with similar issues. The company's pre-tax profit in 2024 was £133,355, a significant drop from the £8.2m achieved in 2023. Bolt's turnover in 2024 decreased from £520m to £488.1m.
One of the main reasons for Bolt's financial struggles has been the withholding of £200m of investment in the UK over the last three years due to government inaction on the "taxi tax". The company also increased its investment in rider and driver incentives in 2024 compared to the previous year. Despite these efforts, headline turnover fell by £31.8m due to a higher level of demand incentives used in 2024 and a one-off VAT credit.
Transportation service costs increased by £25.6m in 2024 for Bolt, and the company dedicated a significant portion of its focus to managing ongoing legal proceedings. A case relating to the worker status of Bolt's drivers was heard by the Employment Tribunal in September 2024, with a decision handed down in November finding that Bolt drivers should be recognized as workers. Bolt has since filed an appeal against this judgement.
Uber, too, has been embroiled in legal battles. In March 2025, the Upper Tax Tribunal rejected HMRC's appeal to block Bolt from using Time of Service (TOMS) methodology. The company has warned Chancellor Rachel Reeves about the potential 20 per cent VAT hike for taxi firms before the Upper Tax Tribunal decision. A financial liability remedy hearing is scheduled to take place during the second quarter of 2026.
Both companies are striving to navigate these challenges. Uber needs to generate and sustain increased revenue levels while lowering proportionate expenses to achieve profitability in many of its largest markets. Bolt, on the other hand, is focusing on managing ongoing legal proceedings and investing in rider and driver incentives to maintain its market presence.
Recent developments include the appointment of Kimberly Hurd as the new UK boss of Bolt in May 2025. The company was represented by the law firm Clifford Chance in the court proceedings concerning the employment status of Bolt’s drivers. Bolt's UK arm is now waiting to hear back whether its appeal can proceed.
These challenges underscore the complexities and uncertainties that these companies face in the UK market, as they strive to balance financial performance with legal compliance and customer satisfaction.
