Uber reported a 21% year-on-year increase in trips, aligning with gross bookings growth on a constant currency basis.
The platform’s audience expanded by 15%, with frequency growing 6%, supported by 7.1 million drivers and couriers.
Recorded an 82% year-over-year growth in adjusted EBITDA, reaching $1.4 billion.
Generated $4.2 billion in free cash flow over the trailing 12 months.
Future Outlook
Uber has experienced strong demand with a recent peak in gross bookings and anticipates over 20% year-on-year growth in Q2 on a constant currency basis.
Question and Answer
Gross Bookings Growth and Outlook
Question
How should investors think about Uber’s gross bookings growth and outlook for the second quarter, considering the impact of audience, frequency, and pricing?
Answer
Uber experienced strong audience growth of 15% and frequency growth of 6% in the first quarter, with pricing remaining relatively flat.
Similar trends are expected to continue in the second quarter, leading to consistent top-line growth of over 20%.
The company expects Mobility to grow in the mid-20s range at constant currency in the second quarter, despite facing FX headwinds primarily from the Argentine peso.
Autonomous Vehicles (AV) Strategy and Impact
Question
How is Uber thinking about the impact of autonomous vehicles (AVs) on its business and potential competition, particularly in light of recent developments with Tesla’s robotaxi efforts?
Answer
Uber sees AV technology as beneficial for the industry, leading to safer rides, expanded marketplaces, and potentially lower prices.
The company believes that AV technology will take time to mature and that a transition period with a combination of human drivers and AVs is likely.
Uber is actively partnering with AV providers and believes its technology, algorithms, and demand will drive utilization of AV assets, benefiting both AV players and Uber’s platform.
Investment Strategy and Latin America Market
Question
Can you provide more details on the intentional holding back of investments in the first quarter, and how will the investment strategy evolve throughout the year to drive sustainable growth? Additionally, can you comment on the competitive landscape and investment trends in Latin America?
Answer
In the first quarter, Uber held back some investments in Mobility due to lower ROI during the seasonal period, but plans to ramp up investments in the second quarter.
The company is confident in Mobility’s margin improvement trajectory but acknowledges some lumpiness in the timing of these improvements.
In Latin America, Uber is seeing healthy Mobility volume growth in the mid-20s and believes the market is attractive despite competitive pressures, particularly from DiDi, which is currently spending aggressively.
Uber has a strong track record of effectively responding to competitive pressures and has the financial flexibility to be aggressive in its investments.
Mobility Monthly Trips Deceleration and Delivery Strategy
Question
Can you explain the deceleration in monthly trips for Mobility Active Platform Consumers (MAPC) in the first quarter, particularly in Latin America, and how does this trend impact the second quarter? Additionally, can you discuss Uber’s delivery strategy in the suburbs, including the key drivers of success and how the Instacart partnership fits into the overall strategy?
Answer
The deceleration in Mobility gross bookings growth in the first quarter was influenced by the deconsolidation of the non-ridesharing portion of the Careem business and some seasonal factors, such as weaker demand in Brazil during Carnival and shifts in the timing of Easter and Ramadan.
Despite these factors, Uber remains confident in the growth of its Mobility business, with mid-20s year-over-year growth expected in the second quarter.
In terms of the suburban delivery strategy, Uber is focused on building audience and brand, increasing selection, optimizing pricing, and ensuring high service quality.
The Instacart partnership brings a high-quality suburban audience to the Uber Eats ecosystem and provides additional demand for merchants, while Uber continues to expand partnerships and increase penetration with key merchants in the suburbs.
Uber One Membership and Subscription Revenue
Question
Can you provide an update on the evolution of Uber One internationally and the key learnings from markets where it has been available for a longer period? Additionally, what are the biggest opportunities for driving further subscription revenue and enhancing the value of Uber One at the subscription layer?
Answer
Uber One’s international strategy is consistent with its global approach, with penetration increasing in the U.S., Canada, and other markets.
Members contribute significantly to Mobility and Delivery gross bookings, with higher spending and retention rates compared to non-members.
Uber is working on various initiatives to drive further subscription revenue, including optimizing the use of Uber Cash, introducing cash-back accelerators, offering member exclusives, and transitioning more members to annual passes, which have shown higher retention rates.
The company sees significant white space for growth in its membership product and is confident in its potential to drive further revenue.
U.S. Rideshare Growth and Drivers
Question
How is U.S. rideshare growth compared to the overall mid-20s growth for the business, and what are the key drivers of growth, including the balance between frequency, new customer acquisition, and other factors?
Answer
While Uber does not disclose specific U.S. Mobility growth figures, the company’s overall high growth rates suggest that the U.S. rideshare market is healthy and a key contributor to growth.
The most significant driver of Mobility growth is audience, with new products like Hailables, Uber for Business (U4B), and Reserve attracting a growing number of new customers.
Uber is seeing strong weekday commute use cases as people return to work, indicating the potential for increased frequency and re-engagement from previous daily users.
Advertising Business and Instacart Partnership
Question
Can you provide an update on the progress of non-restaurant advertising within the overall advertising business, and how does the new Instacart partnership impact Uber’s advertising strategy and O&O efforts in U.S. grocery?
Answer
Non-restaurant advertising is still in its early stages but shows promising growth potential, particularly with sponsored items in grocery, which could potentially surpass the percentage of gross bookings from restaurant advertising.
The Instacart partnership allows Uber to monetize the traffic and engagement generated when users click through from Instacart to the Uber Eats WebView app.
Uber is actively scaling its sponsored items offering in the U.S., Canada, and other priority markets, building on its success with sponsored listings for restaurants.
The company is also seeing strong engagement and click-through rates with rider ads, indicating a promising growth area within its advertising business.
Delivery MAPC Growth and Grocery/Retail Impact
Question
What are the drivers behind the acceleration in Delivery MAPC growth, particularly in markets like the U.S.? Additionally, can you discuss the impact of grocery and retail delivery on segment margins and the path to profitability for these segments?
Answer
Delivery MAPC growth acceleration is attributed to a combination of factors, including improved audience and frequency, a focus on service quality and selection, merchant-funded promos, and the benefits of the overall platform, including cross-promotion from the Mobility business.
The company remains positive on the growth of its grocery and retail delivery business, with strong top-line growth and sequential improvement in Delivery EBITDA margins, partially driven by the improved profitability of the grocery business.
While grocery and retail delivery are not yet at a positive EBITDA margin, Uber sees a clear path to profitability through platform efficiencies, advertising, and lower consumer promotions.
Gig Economy Regulation and Minimum Wage Impact
Question
Can you provide an update on the European gig economy regulation, including the key policies to watch and potential implications for labor costs? Additionally, what is the impact of minimum wage regulations in Seattle and New York on gross bookings and EBITDA for Delivery, and how does Uber plan to mitigate these impacts?
Answer
The EU platform work directive is expected to maintain the status quo with platform worker status determined on a country-by-country basis, and Uber believes the deal is unlikely to bring major changes to the current situation.
In Seattle and New York, minimum wage regulations have had a negative impact on order volumes and courier wait times, leading to a reduction in the number of active couriers on the platform and challenges in meeting demand.
Uber is actively engaging with regulators and advocating for more balanced and effective regulations that benefit couriers, restaurants, and customers.
The company has been able to absorb the financial impact of these regulations due to its diversified market presence and technology-driven marketplace efficiencies.
