Uber (UBER.N) fell 5.72%; as legal settlements and equity investments dragged down its performance, the company lost money last quarter despite rising demand for its ride-hailing and delivery.

The loss came as a surprise to analysts, who had predicted another profit for the quarter. Last year, as a publicly traded company, Uber made a full year profit for the first time. CEO Dara Khosrowshahi has been cutting costs, cutting hundreds of corporate jobs and bonuses for part-time drivers in an attempt to win Wall Street support.

Uber shares fell 5.7% on Wednesday. By the close of trading on Tuesday, the company's stock price had accumulated an increase of 87% over the past 12 months, and the market is optimistic that the company is entering a new phase of stable profits.

In the three months up to March of this year, Uber lost $654 million. Analysts surveyed by FactSet had previously estimated profits of $474 million. The company was profitable for the first three quarters.

Recent losses include $721 million in expenses related to equity investments in other companies. The company made money from its business, but revenue fell short of analysts' expectations as it had to spend money to settle court lawsuits, including class action lawsuits filed by Australian taxi drivers.

Uber said its profits will continue to be affected by its equity investments, although it expects its underlying business to be profitable. The company notes that its free cash flow and adjusted earnings after deducting some fees indicate that the company is still on the path to predictable profitability.

Uber's orders, or the value of transactions on its app, grew 20% during the quarter to $37.65 billion. The cooling in ride-hailing demand in Latin America meant that the company's orders and trips grew less than analysts' expectations. Uber's revenue, or revenue from these transactions, increased 15% to $10.13 billion.

Uber's competitor Lyft (LYFT.O) announced first-quarter results on Tuesday that all exceeded expectations.

Although Uber's taxi orders fell short of expectations, Uber Takeout's takeout orders were slightly higher than analysts' expectations. Since the outbreak of the pandemic, takeout habits have persisted among consumers, even though Uber and its takeout rivals are looking for ways to keep growing.

On Tuesday, Uber announced a partnership where Instacart customers can order food at Uber Eats restaurants through the Instacart app.

Uber's ride-hailing business faces regulatory challenges. Uber and Lyft are threatening to leave Minneapolis to oppose a new minimum wage rule for drivers. Earlier this week, the companies threatened to exit Minnesota altogether if no compromise is reached with Minnesota. Also, in Massachusetts and California, driver reclassification disputes have resurfaced.

This year, New York City and Seattle introduced new minimum wage laws for food delivery workers. Companies such as Uber Takeout responded by increasing the cost of food delivery to consumers. When it released its first-quarter results report last week, DoorDash (DASH.N) said its orders had only dropped by less than 1% due to these changes.

Uber expects adjusted earnings for the quarter to be between $1.45 billion and $1.53 billion. Analysts expected $1.49 billion. The company expects bookings for the current quarter to be between $38.75 billion and $40.25 billion. Analysts expect it to reach $40 billion.