Schwab Network on $UBER (Nov 4, 2026)

We are analyzing Uber's latest quarterly results. So Christine, what are your thoughts on this? I mean, overall Uber is still growing and there were definitely some bright spots.

Yeah, I think it was a pretty good report, you know, they exceeded expectations on both revenue and profit. And if you look at their three main sectors, freight or goods transportation is what has driven this revenue growth.

Overall, their revenue from freight grew by 34% year-on-year.

On the other hand, mobility, meaning their core ride-sharing sector, didn't do so well. Their income was 7.5 billion. The expectation was 7.7 billion, so it's down about 2% year-over-year.

If you listen to CEO Dara Khosrowshahi's comments, it's largely due to the Iran war, high fuel prices, and driver shortages. And it was mainly international, but it also had an impact in the United States. And so those were some of the influences there.

And another bright spot in delivery was, you know, revenue from delivery grew 23% year-over-year. Bookings have increased by 20-23% or 22% year-on-year. So the overall picture was quite bright.

You can see that investors liked the results. The share price is now up about 7%. There was a bit of a lull right after the results came out, because I think there was a question about gross bookings, although they had a 20% growth in gross bookings or total bookings, they had a 20% growth in the third quarter, but it was a bit slower than the second quarter where we saw a 24% growth.

They gave a guidance target of $64.5 billion for the fourth quarter, which is in the middle of their previous guidance range, but I think it was still a little bit lower than some analysts were expecting, but you can see investors have now understood the whole report and they seem to be quite happy with it.

When we look at the numbers, I mean, you definitely bring up some good points, right? The strong growth we have seen, the improvement in profitability. And Andrew, you mentioned it too.

At the same time, there are also some limitations, whether it's with drivers or the high price of gasoline. What is your opinion on this? And what impact will this have on the overall health of organizations like Uber in the next 6 to 12 months?

You know, where are the growth opportunities, or are we worried about some of the downside?

I think overall, Uber's core business is stronger than their stock performance. And what caught my attention was that gross bookings increased by 20%, but adjusted EBITDA increased by 31%.

Investors want to see profits grow faster than the business.

Uber generated more than $2.5 billion in free cash flow this quarter.

I think in some international markets, Uber's supply is lower than its demand. So, the problem is not finding customers, but finding enough drivers. High fuel prices and a driver shortage have forced Uber to increase incentives.

Management says that supplies improved in October, which is encouraging, but those incentives still have an economic cost.

And Uber's challenge is not just to increase the number of rides, but to ensure that the additional rides generate attractive profits. You know, I'm thinking about other sources of income and I definitely want to come up with robo-taxis and autonomous vehicles.

But before we go there, we think about delivery, we think about what Uber is doing with delivery.

DoorDash is definitely a big competitor. Where are we seeing that engagement piece and whether or not it could be a real growth area? Christine, what is your opinion on this?

Yes, as I said, delivery was a bright spot this quarter. They are expanding through acquisitions, such as with Delivery Hero in Germany and Easy Cater in the US, and are increasing partnerships with organizations like Costco, which is now one of their top merchants in terms of gross bookings.

So, yes, this is a place where they are doing very well.

If you look at their monthly active users or, um, what they call monthly active platform subscribers, they reached 215 million in the third quarter. Um, so this is for both delivery and ride share businesses.

And that was in 4. Um, sorry, 4 billion, over 4 billion trips completed in the third quarter. So, that business is in pretty good shape and I think they're very competitive there.

And you know, I almost, I mean, I can't believe they can't find a driver. So, you might be wondering what's wrong with the strategy, how to get more people to drive, right? Or you know, are they not getting enough, I mean, why aren't there more drivers?

I'm a little surprised to hear this comment, but it's okay and I believe it. Sometimes positions are difficult to fill.

Let's move towards robo-taxis and an autonomous future. Well, you know, we're still waiting for these. We've heard a lot about these, but it looks like they're going to become a reality in 2027, Andrew.

Yes, I think the biggest long-term question for Uber is autonomous vehicles. Uber has pledged to invest up to $10 billion to build that ecosystem.

And here is an interesting fact. Automated rides are currently less profitable than driver-driven rides on the Uber platform. This may change as technology improves and vehicle costs decrease.

Uber also believes that its network will keep robo-taxis busy, which will give them an advantage over independent operators. However, this can be a bit confusing. Removing the driver does not reduce costs.

Someone must pay for the vehicle, technology, charging, insurance, and maintenance.

So, I see a lot of potential in this, but there is also significant uncertainty. The question is not whether robo-taxis will come or not, the question is who will share in the profits if they come.

Yeah, I mean, maybe robo-taxis can solve that supply problem for them. However, I completely agree. Now, automated vehicles are less profitable. Uber's CEO has said that over time they will reach the same level of profitability as driverless cars, but that's not the case now.

But, yes, they are expecting 2,000 vehicles on their platform next year and that will reach several thousand in 2028 and beyond. So, they're getting into this game and I think they have to, because there's increasing competition from others like Waymo, who they've also partnered with in Atlanta and Austin.

However, there is clearly a huge opportunity here for Uber.