Ride-hailing service provider Uber Technologies (NYSE:UBER) is shutting down the operations of Drizly, its alcohol delivery platform, Axios reported. This strategic closure comes despite a pandemic-driven expansion that positioned Drizly as the North American leader in online alcohol delivery.
The move is part of a broader consolidation effort within Uber, aimed at streamlining its delivery offerings. Uber intends to prioritize its core Uber Eats business and provide consumers with easy access to diverse offerings like food, groceries, and alcohol through a single app.
Drizly’s Brief History
Uber acquired Drizly for $1.1 billion in February 2021, which functioned as a standalone app for alcohol delivery. Drizly provided back-end technology to help liquor stores handle their own deliveries.
In 2018, Drizly was alerted to significant data security concerns, but the company failed to undertake any remedial measures. Following this, the Federal Trade Commission (FTC) took action against the company in 2022, limiting the types of customer information that Drizly could collect and retain.
It is worth mentioning that Uber was unaware of the security lapses within Drizly’s system at the time of acquisition. Thus, it is reasonable to assume that Uber’s closure of Drizly may have been partially influenced by such concerns.
What is Uber Stock Prediction?
Overall, UBER has a Strong Buy consensus rating based on 36 Buys and one Hold. The average Uber stock price target of $66.61 implies 5.4% upside potential. The stock has gained nearly 116% in the past year.
