Uber: The Aggregator on Trial
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The very first Deep Dive I wrote for MBI Deep Dives, back in 2020, was on Uber, and a lot has obviously changed since then. Uber in 2019 did ~$65 Billion of Gross Bookings while burning ~$4.9 Billion of Free Cash Flow (FCF). Then the pandemic cut Mobility business in half, and Uber’s ability to generate actual profits seemed even more elusive. That question has been answered emphatically. Last year Uber processed ~$193 Billion of Gross Bookings across 13.6 Billion trips, and generated ~$10 Billion of FCF. Delivery segment deserves bit of an apology from me; I was skeptical about delivery’s durability of growth beyond the pandemic, a mistake I highlighted in my DoorDash Deep Dive this July. Delivery’s Gross Bookings in 2025 was 3x of what it was in 2020 and now sits nearly level with Mobility. Color me surprised!
And yet the stock is hovering around $70, only ~67% above the $45 IPO price of May 2019 or ~7% CAGR for anyone who held the whole way despite gross booking becoming ~3x since 2019 with much higher profitability. Mr. Market obviously has no confusion about the last six years, but remains much more shrouded in doubt for the next ten (and beyond) primarily due to Autonomous Vehicles (AV).
I’ve already covered Uber’s history and ridesharing 101 in that 2020 piece, so consider this bit of a sequel to that piece from 2020. In this piece, I will still provide a refresher on the segments. The AV debate is obviously the key focus in the Mobility segment. After that, Delivery segment discusses strategy vs DoorDash, and the recent Delivery Hero acquisition. I also shared my thoughts on management, especially what Dara’s Expedia years potentially tell us. And finally, as usual I finish with valuation, with my usual question: what has to be true for me to earn ~10% IRR without assuming a lofty terminal multiple? The rest of this Deep Dive will be behind the paywall.
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