Uber Gains Momentum with Upbeat Mobility Growth Outlook Amid Robotaxi Challenges
2min read Uber shares are climbing following an optimistic outlook presented at the Barclays Conference, offering a reprieve from a nearly 30 percent decline in its stock price since mid-October. The company reassured investors with robust projections for its Mobility segment and long-term growth plans, despite ongoing concerns surrounding its robotaxi ambitions.
At the conference, Uber forecast mid-to-high or low-twenties gross bookings growth for the first three quarters of fiscal year 2025 in its Mobility segment, a positive signal after its Q3 results showed a slowdown to 24 percent year-over-year growth. The company also outlined a mid-to-high teens compound annual growth rate for gross bookings over the next three years, suggesting confidence in its ability to sustain growth even amid challenges.
One area of focus for future growth is Uber’s push into less densely populated regions with limited on-demand transportation services. Currently, about 45 percent of the U.S. population lives in areas with minimal rideshare coverage. This expansion strategy, targeting rural and suburban markets, could unlock new revenue streams and diversify its user base beyond urban centers.
However, Uber’s robotaxi plans face significant hurdles following General Motors’ recent decision to exit its robotaxi development business. This unexpected move, driven by the substantial capital demands of such an unprofitable endeavor, casts doubt on Uber’s partnership with GM, which was set to bring Cruise autonomous vehicles to its platform in 2025.
The announcement has shaken market confidence in the viability of robotaxi technology, particularly if a major player like GM is unwilling to continue investing in it.
Despite these setbacks, Uber remains committed to its autonomous vehicle strategy. The company has strengthened its collaboration with Google’s Waymo, with plans to launch autonomous rideshare vehicles in Atlanta in 2025. This partnership could help Uber maintain a foothold in the evolving autonomous mobility landscape, albeit with a more measured approach compared to earlier ambitions.
The Barclays Conference also served as a platform for Uber to highlight its financial discipline and profitability goals. The company reiterated its expectation to grow adjusted EBITDA by 40 percent annually from 2023 to 2026, underscoring its commitment to delivering value to shareholders.
Uber’s recent rebound reflects investor optimism in its Mobility segment's potential and its ability to adapt to market conditions. While challenges persist, particularly in the high-risk, capital-intensive robotaxi space, Uber’s focus on expanding coverage, optimizing operations, and leveraging strategic partnerships positions it well for sustained growth.
The road ahead for Uber will require balancing its ambitions in autonomous technology with practical, profitable opportunities in its core Mobility business. If the company can execute its strategic initiatives effectively, it has the potential to regain momentum and capitalize on emerging trends in transportation. For now, Uber’s renewed guidance and proactive steps provide a more positive outlook, helping to stem the tide of recent stock losses.
