Uber research report:
Uber Technologies
The market is pricing Uber as though autonomous vehicles threaten its relevance. We see a platform whose demand, distribution and fleet orchestration could become more valuable as transport supply fragments—but Delivery Hero raises the price of that opportunity.
Uber has changed character. In 2025, revenue rose 18%, non-GAAP operating income increased 50% and reported free cash flow reached US$9.76 billion. In the first quarter of 2026, trips grew 20% while non-GAAP operating income rose 42%. The platform is now translating scale into profit.
The opportunity is not risk-free. Part of 2025 cash generation came from working-capital movements, autonomous fleets may bypass Uber, and the proposed Delivery Hero acquisition is a large, cash-led expansion. We therefore view Uber as attractive rather than obviously cheap.
Why we are interested
Trips and bookings remain near 20% growth while profit is compounding faster. Uber One links Mobility and Delivery, improving engagement and cross-selling.
What the market fears
Waymo, Tesla, Zoox or another autonomous operator could own both the technology and customer, reducing Uber to a low-value intermediary—or bypassing it entirely.
What changes the outcome
Whether Uber becomes the neutral demand and operations layer for many AV fleets, and whether Delivery Hero produces density and synergy without damaging returns on capital.
Uber’s advantage is orchestration
Uber does not primarily sell vehicles or food. It matches local demand with fragmented supply, processes payments, manages pricing and dispatch, and supports the regulatory and operational infrastructure surrounding each transaction. Mobility supplies the strongest economics; Delivery broadens frequency and addressable spend; Freight remains strategically peripheral.
| Q1 2026 | Gross bookings | YoY growth | Revenue | Interpretation |
|---|---|---|---|---|
| Mobility | US$26.39bn | 25% | US$6.80bn | Core profit engine; reported revenue growth was distorted by business-model changes. |
| Delivery | US$25.99bn | 28% | US$5.07bn | Increasingly important engagement, advertising and local-commerce layer. |
| Freight | US$1.33bn | 6% | US$1.34bn | Small contributor with cyclical and lower-quality economics. |
The membership flywheel
Uber One exceeded 50 million members in Q1 2026, up from 30 million at the end of 2024. Members generated half of Mobility and Delivery gross bookings. This is strategically important: the company is shifting from an occasional transaction app towards a recurring relationship spanning rides, meals, groceries and other local services.
Operating leverage is now visible
For 2025, gross bookings rose 19%, adjusted EBITDA increased 35%, and non-GAAP operating income increased 50%. Q1 2026 continued the pattern, with 21% constant-currency bookings growth and 42% non-GAAP operating-income growth. This is the central financial proof of the platform model.
The caution inside free cash flow
Reported 2025 free cash flow of US$9.76 billion included a US$2.2 billion working-capital contribution. Stock-based compensation was US$1.83 billion. We therefore do not capitalise the headline cash figure mechanically: sustainable owner earnings are lower than reported cash flow, though continued profit growth can close the gap.
Autonomy can enlarge the network before it replaces it
The dominant market question is whether driverless vehicles eliminate Uber’s role. That frames autonomy too narrowly. Early AV fleets are geographically constrained, capital-intensive and supplied by several competing technology owners. A neutral platform can aggregate those fleets with human drivers, direct demand towards available supply and raise vehicle utilisation during a long hybrid transition.
Uber announced ten new or expanded AV partnerships in early 2026 and created Uber Autonomous Solutions to help partners deploy and commercialise vehicles. Waymo rides in Atlanta were launched exclusively through Uber, while Volkswagen, Baidu and others have announced deployments using the platform.
The counterargument is serious. Waymo already operates its own consumer app and ended a small Phoenix integration with Uber in June 2026. Tesla and Zoox also have incentives to control the customer relationship. Uber’s own filing warns that superior or cheaper autonomous competitors could reduce demand for its platform. We therefore treat AV distribution as an emerging option, not an established moat.
Delivery Hero: strategic reach at a demanding price
Uber’s July offer values Delivery Hero’s equity at US$14.8 billion, or US$13.7 billion after Uber’s prior purchases. A separate sale of businesses in 14 overlapping markets is expected to yield about US$1.6 billion. The combination would operate across 99 markets with 2025 pro-forma gross bookings of US$236 billion. Management expects non-GAAP EPS accretion on closing and high-single-digit percentage accretion by year three.
That promise is not the same as value creation. Integration, regulatory remedies, acquisition financing and the quality of Delivery Hero’s cash conversion must all be tested. The transaction changes Uber from a largely organic compounding story into one with a meaningful capital-allocation test.
| US$bn except per-share data | 2023 | 2024 | 2025 | Q1 2026 |
|---|---|---|---|---|
| Revenue | 37.3 | 44.0 | 52.0 | 13.2 |
| GAAP operating income | 1.1 | 2.8 | 5.6 | 1.9 |
| Adjusted EBITDA | 4.1 | 6.5 | 8.7 | 2.5 |
| Free cash flow | 3.4 | 6.9 | 9.8 | 2.3 |
| Non-GAAP EPS | — | 1.82 | 2.45 | 0.72 |
Catalysts
- Continued 18–22% gross-bookings growth
- Operating-income growth above bookings growth
- Evidence that AV trips are incremental and profitable
- Credible Delivery Hero financing and synergy disclosure
Why mispricing can persist
- AV economics remain commercially immature
- GAAP earnings are obscured by investment revaluations and tax items
- Reported revenue is affected by business-model classification changes
- Delivery Hero introduces near-term uncertainty
A favourable asymmetry—with real execution risk
We value Uber on prospective equity free cash flow because GAAP net income is distorted by tax benefits and mark-to-market movements in strategic investments. Our 2027 scenarios incorporate acquisition financing and integration effects within the cash-flow assumption. They are Muffett estimates, not company guidance.
| Scenario | 2027 equity FCF | Multiple | Value/share | Return from US$70.36 | What must be true |
|---|---|---|---|---|---|
| Bear | US$8.5bn | 15× | ≈US$62 | −12% | Growth falls towards low teens; Delivery Hero absorbs cash; AV bargaining power shifts to fleet owners. |
| Base | US$11.5bn | 19× | ≈US$106 | +50% | Bookings remain high teens; margins expand; Delivery Hero is broadly accretive; Uber remains a leading hybrid network. |
| Bull | US$14.0bn | 22× | ≈US$149 | +112% | Uber One deepens engagement, advertising scales, AV supply is aggregated on Uber and acquisition synergies arrive early. |
Scenario values use approximately 2.068 billion shares. Rounded figures may not sum precisely. The fair-value range of US$95–115 brackets the base case for execution and timing uncertainty.
| Thesis confirmation | Thesis breaker |
|---|---|
| Constant-currency gross bookings sustain at least 16% growth. | Growth remains below 12% for two consecutive quarters without a temporary macro explanation. |
| Non-GAAP operating income continues growing faster than bookings. | Incentives, insurance or regulatory costs cause sustained margin contraction. |
| AV deployments expand across multiple partners and cities with acceptable economics. | Leading AV fleets withdraw from Uber and successfully migrate demand to proprietary applications. |
| Delivery Hero is accretive without persistent deterioration in leverage or cash conversion. | Integration costs, remedies or financing materially dilute free cash flow per share. |
Selected sources
- Uber Q1 2026 results, 6 May 2026.
- Uber FY2025 results, 4 February 2026.
- Uber 2025 Form 10-K, filed 2026.
- Delivery Hero acquisition announcement, 16 July 2026.
- Uber Q1 2026 prepared remarks, 6 May 2026.
- Reuters: Uber–Waymo Phoenix partnership, 29 June 2026.
Methodology and disclosure: Price and market capitalisation are as of the US close on 31 July 2026. Historical figures are company-reported; adjusted measures are non-GAAP. Scenario forecasts and fair values are Muffett Investments estimates and are inherently uncertain. This material is research and commentary, not personal investment advice. Investments can fall as well as rise, and capital is at risk.
