Uber Stock Tumbles, Analyst Lists Autonomous Vehicles As 'Key Risk'

Goldman Sachs analyst Eric Sheridan maintained a Buy rating on Uber Technologies Inc UBER with a price target of $96.

Uber reported fourth-quarter gross bookings of $44.2 billion (versus Sheridan’s estimate of $43.97 billion, Street’s $43.50 billion, & guide of $42.75 billion-$44.25 billion), with Mobility at $22.80 billion & Delivery at $20.13 billion.

Total revenues were $11.96 billion (versus Sheridan’s estimate of $11.68 billion & Street’s $11.76 billion), with Mobility at $6.91 billion, Delivery at $3.77 billion & Freight at $1.28 billion.

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Adjusted EBITDA was $1.84 billion (versus Sheridan’s estimate of $1.87 billion, Street’s $1.84 billion & guide of $1.78 billion-$1.88 billion).

By segment:

• Mobility adjusted EBITDA was $1.77 billion
• Delivery was $727 million
• Freight was a loss of $22 million.
• GAAP EPS was $3.21, compared to Sheridan’s estimate of 78 cents and Street’s 50 cents.

Uber guided to first-quarter 2025 total bookings of $42 billion—$43.5 billion (compared to Sheridan’s estimate of $43.30 billion and Street’s estimate of $43.51 billion) and adjusted EBITDA of $1.79 billion—$1.89 billion (versus Sheridan’s estimate of $1.82 billion and Street’s estimate of $1.85 billion).

Sheridan expects investors to have an initial muted reaction to Uber’s fourth-quarter of 2024 earnings report.

On the fundamentals, reported Gross Bookings for the quarter came in toward the upper half of its previously guided range (but the 21% foreign-exchange-neutral growth was above the high-end of their foreign-exchange-neutral guidance), with worse foreign-exchange impact, better than feared performance in the Mobility segment specifically, inline on Delivery (versus Sheridan estimates) with modestly weaker results in Freight.

Adjusted EBITDA aligned with Street and slightly above the mid-point of the previously guided range. For the first quarter of 2025 guidance, Gross Bookings growth of 17%-21% was modestly weaker than Sheridan and Street estimates by 1%-2% at the mid-point. It included a 550bps foreign-exchange headwind, while adjusted EBITDA guidance was roughly in line with Sheridan and Street estimates.

The San Francisco-based company repurchased $555 million worth of stock in the quarter. In January, it announced an accelerated share repurchase agreement to repurchase $1.5 billion as part of the current $7 billion repurchase authorization.

Key Risks to Sheridan’s Buy rating:

• Slower growth in Mobility due to demand elasticity, maturation, and competition from Autonomous Vehicles
• Regulatory environment around driver classification (i.e., compensation, benefits, etc.)
• Competitive forces in both Mobility and Delivery
• Normalization of consumer discretionary spend habits within Delivery and
• Volatility caused by the global macroeconomic environment and investor risk appetite for growth stocks.

Price Action: Uber stock is down 6.8% at $65.00 at the last check on Wednesday.

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