Uber’s Q4 Earnings Beat on Revenue but Conservative Guidance and Robotaxi Uncertainty Weigh on Stock

Uber Technologies delivered a mixed fourth-quarter earnings report, exceeding expectations on revenue and gross bookings but falling short on operating income, leading to a sharp sell-off in shares. The company posted adjusted earnings per share (EPS) of $3.21, significantly above last year’s $0.66, but this included a $6.4 billion benefit from a tax valuation release. Revenue for the quarter came in at $11.96 billion, growing 20% year-over-year and slightly beating the $11.77 billion consensus estimate. Gross bookings reached $44.2 billion, an 18% increase and above expectations of $43.49 billion. However, adjusted EBITDA of $1.84 billion was just below the $1.85 billion estimate, while operating income of $770 million fell well short of the $1.19 billion consensus forecast.

Key operating metrics demonstrated continued platform growth, particularly in mobility and delivery segments. Mobility gross bookings totaled $22.8 billion, rising 18% and exceeding the $22.52 billion estimate, while delivery gross bookings reached $20.13 billion, also up 18% and ahead of the $19.7 billion expectation. The freight business was a notable weak spot, generating $1.27 billion in gross bookings, down 0.5% year-over-year and missing the $1.31 billion estimate.

Uber reported 3.07 billion total trips, up 18% from the previous year and above the 3.02 billion expected. The company’s monthly active platform consumers grew 14% to 171 million, surpassing the 168.35 million forecast.

Uber’s forward guidance for the first quarter was seen as underwhelming, contributing to the negative market reaction. The company projected gross bookings between $42.0 billion and $43.5 billion, with analysts previously anticipating the high end of that range. Adjusted EBITDA guidance of $1.79 billion to $1.89 billion was largely in line with expectations of $1.85 billion, but investors appeared to be looking for a stronger outlook given Uber’s recent momentum. Management also indicated that U.S. ride prices may see modest increases in 2025 due to higher insurance costs, which could impact demand.

The market’s disappointment in the company’s cautious guidance was reflected in a 7% drop in Uber shares premarket, with the stock rejecting the 200-day moving average at $69 and testing support near the 20-day moving average at $66.

A key topic for Uber’s future strategy is the rise of autonomous vehicles, particularly the potential impact of robotaxis on its core business. CEO Dara Khosrowshahi emphasized that Uber is positioning itself as the platform for autonomous vehicles rather than being disrupted by them. The company has partnered with Waymo to launch robotaxi rides in Austin, Texas, allowing users to opt into an interest list via the Uber app. Uber has also been investing in new app features, physical infrastructure, and customer support to prepare for broader adoption of self-driving technology. However, the growing presence of Waymo and Tesla’s plans for robotaxi deployment has raised questions among investors about whether Uber can effectively integrate autonomous technology while maintaining profitability.

Despite the short-term stock weakness, Uber’s underlying business remains strong, with robust growth in bookings, trips, and platform users. Mobility and delivery both continue to expand at an 18% pace, reflecting solid demand across Uber’s key segments. However, concerns about the long-term competitive landscape, especially in autonomous driving, along with conservative guidance, weighed on investor sentiment.

The upcoming earnings call at 8 a.m. will be critical in determining whether Uber’s cautious outlook is simply a conservative approach or indicative of broader challenges ahead. Holding the $66 support level could be crucial for maintaining the stock’s recent upward trend.