NYSE:UBER Uber Technologies Q2 2024 Earnings Report $70.25 -1.57 (-2.19%) As of 03:58 PM Eastern ProfileEarnings HistoryForecast Uber Technologies EPS ResultsActual EPS$0.47Consensus EPS $0.31Beat/MissBeat by +$0.16One Year Ago EPS$0.18Uber Technologies Revenue ResultsActual Revenue$10.70 billionExpected Revenue$10.57 billionBeat/MissBeat by +$131.72 millionYoY Revenue Growth+15.90%Uber Technologies Announcement DetailsQuarterQ2 2024Date8/6/2024TimeAfter Market ClosesConference Call DateTuesday, August 6, 2024Conference Call Time8:00AM ETUpcoming EarningsUber Technologies' Q2 2026 earnings is estimated for Wednesday, August 5, 2026, based on past reporting schedules, with a conference call scheduled at 8:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Uber Technologies Q2 2024 Earnings Call TranscriptProvided by QuartrAugust 6, 2024 ShareLink copied to clipboard.Key Takeaways Uber delivered a record Q2 with gross bookings up 21% YoY on a constant currency basis, adjusted EBITDA up 71%, and record quarterly GAAP operating income. The platform showed consumer resilience with a 14% increase in audience, 6% increase in trip frequency, no trading down across income cohorts, and 50% of delivery bookings driven by Uber One memberships. Uber highlighted its unique position in autonomous vehicles by supporting 1 million trips per hour, processing over 10 million predictions per second, and entering late‐stage talks with multiple AV players to leverage its marketplace tech. Delivery and grocery continued to drive growth and profitability, with 1.1 million merchants on the Eats platform, over $1 billion ad run-rate revenue, merchant-funded offers up 70% YoY, and 10% incremental margin in Q2. The 100 000‐vehicle partnership with BYD aims to accelerate electrification, building on drivers switching to EVs at five times the market rate to support Uber’s climate goals. AI Generated. May Contain Errors.Conference Call Audio Live Call not available Earnings Conference CallUber Technologies Q2 202400:00 / 00:00Speed:1x1.25x1.5x2xTranscript SectionsPresentationParticipantsPresentationSkip to Participants Operator00:00:00Hello and welcome. Deepa SubramanianVP of Investor Relations at Uber Technologies00:00:00Thank you, operator. Operator00:00:04Thank you, and welcome to the Uber Q2 2024 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, please press star one on your telephone keypad. I would now like to turn the conference over to Deepa Subramanian, Vice President, Investor Relations, Corporate Finance. Please go ahead. Deepa SubramanianVP of Investor Relations at Uber Technologies00:00:31Thank you, operator. Thank you for joining us today, and welcome to Uber's second quarter 2024 earnings presentation. On the call today, we have Uber CEO, Dara Khosrowshahi, and CFO, Prashanth Mahendra-Rajah. During today's call, we will present both GAAP and non-GAAP financial measures. Additional disclosures regarding these non-GAAP measures, including a reconciliation of GAAP to non-GAAP measures, are included in the press release, supplemental slides, and our filings with the SEC, each of which is posted to investor.uber.com. Certain statements in this presentation and on this call are forward-looking statements. You should not place undue reliance on forward-looking statements. Actual results may differ materially from these forward-looking statements, and we do not undertake any obligation to update any forward-looking statements we make today, except as required by law. Deepa SubramanianVP of Investor Relations at Uber Technologies00:01:29For more information about factors that may cause actual results to differ materially from forward-looking statements, please refer to the press release we issued today, as well as the risks and uncertainties described in our most recent Form 10-K, and in other filings made with the SEC. We published our quarterly earnings press release, prepared remarks, and supplemental slides to our investor relations website earlier today, and we ask you review those documents if you haven't already. We will open the call to questions following brief opening remarks from Dara. With that, let me hand it over to Dara. Dara KhosrowshahiCEO at Uber Technologies00:02:03Thanks, Deepa. Q2 was another record quarter for Uber and further demonstrated our ability to deliver profitable growth at scale. Gross bookings grew 21% on a constant currency basis, consistent with trip growth. Our audience expanded 14%, while frequency grew 6%, supported by 7.4 million drivers and couriers globally. At the same time, adjusted EBITDA grew 71% year-on-year, and we generated record quarterly GAAP operating income. These are super strong results that we're proud of, but I also understand there are two big questions out there that I want to address before we head into Q&A. First, the strength of the consumer and how Uber will perform in a recession. Based on what we're seeing today, the Uber consumer is in great shape. Our audience is bigger than ever and using our services more frequently than ever. Dara KhosrowshahiCEO at Uber Technologies00:02:53While our consumers tend to be higher income, we're not seeing any softness or trading down across any income cohort. If the current macroeconomic fears fail to materialize, we're confident that Uber can perform well because of the countercyclical nature of our platform. On the mobility side, more driver supply brings down prices for riders and improves reliability. On the delivery side, merchants are investing in performance channels like ours for growth, improving selection and affordability for consumers. In fact, in Q2, the number of first-time consumers on Uber Eats in the U.S. was higher than at any point over the past five quarters. It's clear that delivery is much more habitual than many assumed, made even more so by our Uber One membership, which now accounts for 50% of delivery gross bookings. We'll continue to drive consistent top-line growth while expanding GAAP operating income. Dara KhosrowshahiCEO at Uber Technologies00:03:49Our track record of making and then exceeding our commitments should give investors confidence that we built the capital discipline and operational muscle to perform well in any scenario. Second, autonomous. Put simply, Uber is uniquely positioned to offer tremendous value for AV players looking to deploy their technology at scale. While the operation of a ride hail network may seem simple, our technology obscures a huge amount of complexity. We support roughly 1 million trips per hour, and our average ETA globally is approximately 4 minutes. That's possible because of marketplace tech that makes over 10 million predictions per second, and more mundanely, we handle more than 25 million lost items in just last year alone. We also know that a key factor in AV commercialization will be asset utilization. Dara KhosrowshahiCEO at Uber Technologies00:04:43AV players will need to ensure that their expensive assets are being used as close to 24 hours a day as possible, while also managing the daily and weekly peaks and valleys of ride hail activity. Uber can provide enormous demand without AV players needing to invest capital towards acquiring customers or building the marketplace tech that delivers reliability at the standard that consumers have come to expect. Let's all say that Uber will be an indispensable partner for AV players of all sorts. We're in late-stage discussions with additional global AV players to join our platform, and we'll have more announcements in the coming weeks and months. Thanks to the Uber team for another great quarter. With that, operator, let's open the call for questions. Operator00:05:28Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you would like to withdraw your question, simply press star one again. Please ensure that your phone is not on mute when called upon. Your first question comes from the line of Brian Nowak with Morgan Stanley. Your line is open. Brian NowakManaging Director at Morgan Stanley00:05:48Thanks for taking my questions. I have two, the first one on AV. Dara, I appreciate the color and even the extra color in the press release. Question, is there any more detail on what you're seeing in Arizona around incrementality of rides from the partnership? How do we think about sort of the relative unit economics? And philosophically, what is your strategy of reinvesting dollars to sort of drive more AV growth versus sort of delivering profitability? And then the second one on mobility specifically, can you talk to us a little bit about what you're seeing on mobility, MAPC versus frequency growth drivers? Just so we can sort of break apart what's driving that growth in the quarter for mobility. Thanks. Dara KhosrowshahiCEO at Uber Technologies00:06:33Sure. Absolutely, Brian. Thanks for the question. So I don't wanna speak specifically to Arizona, because obviously we have Waymo as a partner there, and I wanna hold confidentiality, et cetera, as any partner should. But when we look more broadly at our operations with the various AV players that we see, what we do see is that the utilization that these AV players are able to develop on our network is significantly higher than the utilization we believe that they're able to run out without a network on a 1P basis. So 3P utilization is significantly higher than 1P utilization. And if you think about the role of the marketplace, the role of the marketplace is to drive utilization of fixed assets. Dara KhosrowshahiCEO at Uber Technologies00:07:24I mean, it's in the end, it's why a McDonald's or a Starbucks or even Domino's now works with us. They have direct channels to consumers, but they also work through the marketplace to bring demand, more demand to their stores, so to speak. And we think the same will be true of AV players, which is as long as we're able to drive higher utilization, and the utilization that we drive, the incrementality, we think significantly exceeds the take rate that we will charge. On average for mobility, not including insurance costs, our global take rate is around 20%, so you'd have to drive 25% increase in utilization. We believe that those utilization numbers are possible, and we think that we can exceed those kinds of utilization numbers. So right now, the economics and the math are definitely working. Dara KhosrowshahiCEO at Uber Technologies00:08:13I think the additional benefit that we bring to these players is, we have a dynamic dispatch model that can determine what are the pickups and dropoffs that an autonomous player can effectively play with. You know, the pickup point is easy, it's within a block, same thing with the drop-off points. And then what are the circumstances when we should dispatch human for a particular pickup or a drop-off if the route is complex or the pickup or drop-off has some special circumstances? So we're able to essentially allow autonomous players to dispatch in situations where we know that they will succeed. So all in all, the early data is quite encouraging. And as I said, we've had lots of discussions with other players out there. Dara KhosrowshahiCEO at Uber Technologies00:09:00We don't think this will be a winner-take-all market, and we think that we will continue to have the most liquid and largest marketplace that will have humans and AV players as part of it during this pretty long hybrid period as autonomous is developing, and regulators are trying to figure out exactly how to regulate it. Prashanth, do you want to take the second one? Prashanth Mahendra-RajahCFO at Uber Technologies00:09:25I will. I will. Thanks, Dara. I think, Brian, your question was on, mobility growth. So maybe I'll, I'll start with just, restating how we did for, Q2 and our outlook for Q3. So for Q2, the results that we printed, if you do it at a constant currency, very strong at, at 27% year-over-year growth. For Q3, we're looking for sort of a repeat in that, mid-20s range, again, on a constant currency basis. But when you, dig into why do we have, such confidence in the mobility business, I would take you back to the, framework we talked about in February, that mobility, over the 3 years that we gave you, should be growing at the mid-teens or better. And that's coming from a couple items. Prashanth Mahendra-RajahCFO at Uber Technologies00:10:12On the user side, we still believe that we have a pretty massive TAM that we can go after. We're continuing to drive product innovation, and we talked about a couple of those at GO-GET earlier this year, and we're continuing to find new demographics and areas to continue to expand in. Maybe one data point on TAM that I think is helpful for folks is our monthly penetration of consumers, and we define that as folks who are over 18 years is less than 20% across our top 10 countries. So a lot of room to run there. Another key driver will be frequency, which I think folks understand to be how many times our monthly actives engage with the platform. Prashanth Mahendra-RajahCFO at Uber Technologies00:10:58We are launching new products, continuing to improve reliability so that, when you, when you call for an Uber, we're able to get you one at a time that you're looking for, and of course, the benefits of membership. Only about, about half of our riders, take one to two trips per month. So again, plenty of upside there to continue to drive this as a more frequent, frequent daily use case. Dara KhosrowshahiCEO at Uber Technologies00:11:23And then, Brian, I think you, you'd asked about our strategy to reinvest, to drive, let's say, AV growth versus profits. You know, generally, we are able to lean into our newer products. So, for example, if you look at, Moto, which are two-wheelers in, Latin America and a number of developing countries, if you look at our shared product, UberX Share, where we get more than one passenger in a vehicle or even taxis, those newer products are growing faster than the base business, and their margins are substantially lower than the base business. Dara KhosrowshahiCEO at Uber Technologies00:11:58But we're able to, as we scale, we're able to leverage our cost base, our technology improvements in terms of targeting, in terms of CPT, allow us to have a profit envelope to be able to reinvest into our newer products, AV is one of those new products, while overall increasing profit margins. This is something that we've been doing for years, and we think AV will be part of the same equation. So I don't, you know, AV is not something that we're gonna look to make substantial profits for, from over the next five to 10 years, and that's just fine because we'll be able to build a lot of liquidity in the marketplace to kind of continue along the path that we have been operating in over the past five years. Brian NowakManaging Director at Morgan Stanley00:12:43Great. Thank you both. Dara KhosrowshahiCEO at Uber Technologies00:12:45You're welcome. Next question. Operator00:12:47Your next question comes from the line of Doug Anmuth with J.P. Morgan. Your line is open. Doug AnmuthHead of U.S. Internet Equity Research at J.P. Morgan00:12:54Thanks so much for taking the questions. Dara, can you just talk more about the importance of the BYD partnership as you bring new EVs into global markets, and then perhaps how that can tie into AV over time? And then, Prashant, just if you could talk more about the drivers of delivery, profitability, good upside there in the quarter, and what gives you the confidence on the clear path to EBITDA profit in, in grocery and retail as well? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:13:24Yeah, absolutely, Doug. So I'll, I'll start with BYD. You know, the electrification of our fleet is an incredibly important initiative for us. We are, if you look at Uber, Uber drivers are switching over to electric at five times kind of the speed that normal drivers are. And if there's any driver that you want to switch over to EVs, it's an Uber driver, because Uber drivers also drive around five times the miles of a regular driver as well. So it's a very targeted segment that we're going after, and we're hoping that kind of governments can help us go after as well. The number one reason why some drivers hesitate to move over to EVs is affordability. Dara KhosrowshahiCEO at Uber Technologies00:14:12And the fact is that BYD, when you look at cost and quality, BYD is really second to none in terms of any manufacturer out there. We're very, very excited with the partnership. We are, we believe we're gonna bring over 100,000 new BYD EVs onto the Uber platform across some of our most important global markets out there. And, you know, we've always talked about climate being a team sport. We are going to be leaders in terms of climate change, and having BYD as a partner is just terrific to see. More recently, BYD has committed to very, very significant investments in the AV space, and judging from what they have accomplished in the EV space, I would not, I would make a bet on them in AV as well. Dara KhosrowshahiCEO at Uber Technologies00:15:04But the investment that they're making in AV is in the $ billions, and we're very much looking forward to partnering with them on both EVs and AVs. Prashanth? Prashanth Mahendra-RajahCFO at Uber Technologies00:15:14Yeah. Dara KhosrowshahiCEO at Uber Technologies00:15:15Go on. Prashanth Mahendra-RajahCFO at Uber Technologies00:15:15Yes. So I think your question was on delivery profitability. So, although we don't, we don't wanna draw attention to incremental margins, we did have a pretty terrific quarter for incremental margins in delivery, 10% for the second quarter. So putting a little context around that. We are clearly seeing the benefits of scale as it runs through the delivery business, and we still have many levers that we're continuing to tune to drive that profitability in delivery. That includes some incredible tech that the team has built that continues to drive down the cost per transaction, cost per trip in terms of operational improvements. We've got great improvements in advertising. Prashanth Mahendra-RajahCFO at Uber Technologies00:16:03I think we mentioned in the prepared remarks, that's now running in excess of $1 billion on a run rate basis, and continuing to find ways both operationally and with tech to reduce some of our other costs, like refunds and appeasements, which are still a bit of a drag on the delivery segment. The fact that we were able to grow delivery profitability while continuing to have very strong growth in grocery really is a good indicator of how much strong growth we're seeing in that profitability. I think delivery EBITDA was up, like, 25 basis points sequentially, and that is despite grocery growing at a pretty substantially faster rate than delivery. Prashanth Mahendra-RajahCFO at Uber Technologies00:16:54It, in grocery profitability, it's what we've talked about in the, in the past. It is, you know, using the power of the platform, we can bring down the customer acquisition costs, and drive those cost efficiencies. We've got 15% of our Eats customers are now using grocery. That's up about 200 basis points year-over-year, as of, as of middle of the year. And we're seeing retention on grocery also improving. I mentioned the ads revenue, and then also, starting, given that we... our selection's improving, we're also driving down consumer promotions, and continuing to add more and more merchants onto the, to the platform. We mentioned Costco, and I think in the, in the press release or prepared remarks, we also mentioned a couple other grocers. Prashanth Mahendra-RajahCFO at Uber Technologies00:17:41So, all in all, things are on track to where we gave you in our, in our, three-year model, and grocery is continuing to be a strong story for our delivery business. Prashanth Mahendra-RajahCFO at Uber Technologies00:17:52Just one very encouraging trend on grocery and retail is that ad spend on grocery and retail more than tripled on a year-on-year basis. Obviously, that's a very high-margin product, and we are continuing to expand kind of our CPG product now into a bunch of new countries. So the momentum there is terrific to see. Prashanth Mahendra-RajahCFO at Uber Technologies00:18:12Next question, please. Doug AnmuthHead of U.S. Internet Equity Research at J.P. Morgan00:18:14Thank you. Operator00:18:14Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is open. Eric SheridanPartner and Managing Director at Goldman Sachs00:18:21Thanks so much for taking the questions. Maybe two, if I could, coming back to the delivery business. Building on the last set of comments, how do you think about the potential longer term for increased utility, increased frequency as you layer more supply into the delivery network, and, and, and what you continue to learn about the relationship of evolving the experience for consumers and what it means for, for platform growth over a longer period of time? And then also on the delivery side, we've seen a lot of market consolidation and market rationalization in some of the countries around the globe. How do you think about the asset portfolio on delivery and your current marketing positioning against some of those industry dynamics you're seeing on the capital side? Thanks so much. Dara KhosrowshahiCEO at Uber Technologies00:19:06Yeah, Eric, so what we're seeing in terms of delivery is the long-term growth is incredibly promising, and especially our ability to expand into the adjacent category of grocery and retail. You know, the grocery and retail TAM is actually bigger than the online food delivery TAM. So not only do we believe we've got a long runway in online food delivery, but we're just getting started as it relates to grocery and retail. We now have 1.1 million merchants on the platform. It's up 13%. Dara KhosrowshahiCEO at Uber Technologies00:19:43Our merchant penetration in most countries still is very low, well under 50%, and every time we add a merchant, because we have more diversity of choice, average conversion tends to improve for consumers who are kind of searching for their favorite restaurant or, you know, favorite dessert place. And each merchant gives us actually another item to market against as it relates to search engine optimization or search engine marketing in third-party channels as well. So new merchants add, you know, conversion, choice, and actually are another item to market against, and we're very, very long way in terms of full merchant penetration in the marketplace. And it all results in eater retention being up globally in every single mega region that just in June on a year-on-year basis. Dara KhosrowshahiCEO at Uber Technologies00:20:42So right now we believe there's a very, very long run rate for growth. The more consumers use our product in a multiproduct way, whether it's a mobility user using delivery or a delivery user buying from grocery or and retail, the more they transact on the platform. Multiproduct consumers spend three times more than single-product consumers. And for us, the more products we add to the marketplace, the more kind of this benefit adds onto it, and then on top of that, you add our membership product as well, which is now over 50% of bookings. So you know, the volumes are strong. We are not having to buy our way into strong volumes. Dara KhosrowshahiCEO at Uber Technologies00:21:30We're kind of earning our way into strong volumes, and I think the fundamentals are gonna be there for some time to come. In terms of our portfolio, we had made the strategic decision a few years ago, it's probably three or four years ago, to exit markets that we didn't think we could either be the number one or number two, and if we're the number two, the ability to move to a number one position. We've gained category position delivery in every one of our top 10 markets on a year-on-year basis. It's a function of the great execution of our operations team, the technology that we're shipping, and then the power of the platform. There's no other global player who operates both in mobility and delivery or has as broad a platform as we do. Dara KhosrowshahiCEO at Uber Technologies00:22:15So we're very happy with our portfolio, so to speak, and I think the results speak for themselves. Prashanth Mahendra-RajahCFO at Uber Technologies00:22:23Eric, as someone who's been in the business coming up now on my one-year anniversary soon, I'm surprised... I was surprised to learn how sticky the food delivery business is. It is very habitual, and we've got great data that shows that stickiness is improving. I think I look back at five, six quarters of data, and it gets better every quarter in terms of eater retention. So there's clearly the trajectory to follow what we're seeing in mobility. Eric SheridanPartner and Managing Director at Goldman Sachs00:22:51Appreciate it. Thank you. Dara KhosrowshahiCEO at Uber Technologies00:22:54You're welcome. Next question. Operator00:22:56Your next question comes from the line of Justin Post with Bank of America. Your line is open. Justin PostMerrill Lynch Internet Analyst at Bank of America00:23:03Thank you. I wonder if you could revisit the consumer downturn scenario. What would you expect to happen for mobility if we do have a recession or a bigger downturn as far as maybe trade down or looking for lower price rides, the impact on bookings and profitability? And then, Prashanth, maybe you could talk about looks like you've turned the corner on independent contractor deals in Massachusetts, other areas. What happens to your costs when you sign those deals? And can you cover it with higher fees or what are the business model impacts of signing those deals? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:23:41Yeah, Justin, in terms of a consumer downturn scenario on mobility, we've seen these circumstances in a number of markets. Latam has been through a bunch of cyclical trends, et cetera. And usually a downturn, kind of the leading indicator of a downturn is a weak job market. We might be seeing it in some of the Western markets. We might not. It's very difficult to tell. But when there's a weaker job market, typically, our driver supply on the mobility side significantly improves. We're a very, very flexible work platform. Average earnings per utilized hour for drivers in the U.S., for example, is $33 per utilized hour. So, it's highly flexible, and the earnings per utilized hour are strong. So typically, what we see is improvement in driver supply. Dara KhosrowshahiCEO at Uber Technologies00:24:35As driver supply improves, surge comes down, ETAs improve, the service itself becomes more compelling. And as a result, volumes typically turn out to be quite quite sticky. In addition to those trends, we are actively investing in affordability, right? The membership program essentially brings prices down for both mobility and delivery, and we're investing in products such as two-wheelers and three-wheelers, and UberX Share, all of whom, you know, provide discounts of, let's say, 25%-50%, of, of, let's say, the price of an UberX as well. So we think that we can thrive in upturns and downturns, and I think that the team has proven that they've, you know, kind of execution capability to be able to perform in any kind of a market. And listen, we are... Dara KhosrowshahiCEO at Uber Technologies00:25:31We're watching trends very, very quickly, and I do believe we'll be able to adjust as needed. Prashanth, you wanna talk about Massachusetts? Prashanth Mahendra-RajahCFO at Uber Technologies00:25:39Yeah, I will. I will. Justin, maybe I'll also just start by just reminding folks that we have three different, sort of broad models on how we go to market in our operating frameworks for folks. So we have the traditional independent contractor, which is how most people think of Uber, and that is the model that the company was largely built on. And then over time, we've adapted to now the IC Plus model, which is what you referred to for Massachusetts, and that's where we enter into agreements to provide some level of benefits. Prashanth Mahendra-RajahCFO at Uber Technologies00:26:12And then there are still some countries that we use a fleet model, where an independent company sort of handles the actual execution on the ground, and we serve as feeding them the global or the in-country demand or the in-city demand. So specifically in Massachusetts, we reached a deal with the Attorney General that settled on a set of standards for earners. That includes, you know, how we measure or how we define time on the platform, certain healthcare, family, and medical leave benefits as well. As a consequence for that, the Attorney General dropped their action against Uber, and we're no longer in pursuit of a ballot issue in Massachusetts like we had very successfully done in California. Prashanth Mahendra-RajahCFO at Uber Technologies00:27:05The consequence of that is we will factor that into our operating model in Massachusetts. But as we've said back in February on our Investor Day, we still have plenty of runway to focus on operational costs. So while this will be built into the cost structure that we push to the market, we continue to believe that there's plenty of runway ahead for us to continue to drive down our operating costs through the support costs and payments and a variety of other measures that we continue to sort of grind out those basis points that will continue to make Uber an affordable option for all. Justin PostMerrill Lynch Internet Analyst at Bank of America00:27:46Great. Thank you. Dara KhosrowshahiCEO at Uber Technologies00:27:48You're welcome. Next question, operator. Operator00:27:51Your next question comes from the line of Nikhil Devnani with Bernstein. Your line is open. Nikhil DevnaniSenior Analyst of U.S. Internet at Bernstein00:27:58Hi, thanks for taking my question. Dara, I wanted to ask a two-parter on autonomous vehicles. First, can you help us understand how much of the rideshare demand takes place during peak hours and mornings and evenings? I would imagine that utilization math around the peak is, is really at the core of your value prop to partners. And then second, the partnership model makes a lot of sense to us for both sides, but there is a world where providers choose not to partner, they choose to compete more directly. So my second question is around, I guess, what the plan B is for Uber in the event that leading players choose not to extend partnerships or engage in partnerships. How do you navigate that scenario? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:28:38Yeah. Yeah, absolutely. So in terms of peak and trough, while we haven't disclosed the numbers, there are very, very significant peaks during rush hour, both ways, obviously in the mornings and going home during kind of after-hours drinks, et cetera. We are able to shape demand and supply, actually, you know, demand through search when we need to, and supply, obviously positioning our drivers through incentives, either on a temporal basis or on a geographic basis, you know, if there's a concert going on, et cetera. The good news there is that through our incentive structure, essentially those are variable costs for us. We will pay more during those peak periods, and then when we don't need supply, we can take incentives out. Dara KhosrowshahiCEO at Uber Technologies00:29:34So we have a model where essentially we're able to shape supply to match demand in a variable basis. I think that in an AV world, the car is there at all times, so you kind of have to pay the overhead for the car and the amortization of the car during all periods. So we think kind of a hybrid network that consists of both humans and robots can handle the peaks and valleys much more effectively than a pure play network. In terms of AV partnerships, et cetera, I would tell you, Nikhil, that based on the conversations that we're having, we are highly, highly confident of being able to acquire AV content, if you want to call it that, on a global basis. Dara KhosrowshahiCEO at Uber Technologies00:30:24The fact is, this is not turning out to be a winner-take-all market. Originally, I think that was the concept why Uber wanted to develop the technology itself, but every single OEM is investing in some L2 or L3 technology. If you look at some of the newer tech coming in terms of imitation learning, technologies that have taken kind of the imagination of folks through LLMs, that same technology, we believe, can potentially introduce a new wave of AV through imitation learning at substantially lower capital costs than was necessary historically. So we think there are going to be many, many AV providers. Dara KhosrowshahiCEO at Uber Technologies00:31:10If there are many, many AV providers, the marketplace, and our marketplace is by far the largest marketplace, global marketplace, both for mobility, delivery and then freight as well, you know, the marketplace will have a very, very strong position. So at this point, we don't see any signal that a plan B will be necessary. Also take note that we have investments, strategic investments in a number of AV players. Aurora, we're working with Waymo, for example, and there are other investments that we have in AV players to make sure that kind of plan A is the right plan going forward. So far, I'd say so good, and as I mentioned in my remarks, we will have more partnerships to announce in the next week, weeks and months. Dara KhosrowshahiCEO at Uber Technologies00:31:58I think, you know, the market will see, and you'll see that plan B isn't necessary. Nikhil DevnaniSenior Analyst of U.S. Internet at Bernstein00:32:03Thanks, Dara. Dara KhosrowshahiCEO at Uber Technologies00:32:05You're very welcome. Next question, operator? Operator00:32:08Your next question comes from the line of John Colantuoni with Jefferies. Your line is open. John ColantuoniManaging Director at Jefferies00:32:16Great. Thanks for taking my questions. Given the continued progress on mobility frequency, I was curious if we could go back to some disclosure you provided about a year ago, showing that pre-COVID cohorts in the U.S. and Canada had lower frequency than more recent cohorts. How has mobility usage progressed over across cohorts over the past year? And what does that progression tell you about the opportunity to keep driving frequency higher through multi-product adoption? And second, the $1 billion in advertising run rate suggests over 50% growth, which is really strong, but a bit of a deceleration from more like 80% exiting last year. Talk about how restaurants are balancing investments in sponsored listings versus merchant-funded offerings, which you mentioned grew over 70% year-over-year in the quarter. Thanks. Dara KhosrowshahiCEO at Uber Technologies00:33:13So John, in terms of mobility frequency, while we're not going to disclose, you know, specifically what frequency looks like, I would say that when we look at lower cost products, when you look at UberX Share, hailables, two-wheelers, three-wheelers, the frequency of some of the newer products is significantly higher than the frequency of, call it, the X products, et cetera. When you look at the overall frequency numbers for both mobility and delivery, they're up on a year-on-year basis. It is absolutely helped by multi-product usage. It is absolutely helped by membership as well. So whether you look at cohorts, whether you look at new customers, high income, low income, the frequency numbers for us in both mobility and delivery are very, very constructive. You want to talk about ads, Prashant? Prashanth Mahendra-RajahCFO at Uber Technologies00:34:07Sure. So I think the question, your question, John, again, was on merchant-funded offers, how are we... or on offers in general, how are we seeing that in on an impact for the business? So I would tell you to think about it in two elements. First, as we're able to drive, and we see very strong cooperation from merchants in using merchant-funded offers to drive their demand, it is actually being a very helpful way for them to address their need to attack the affordability question that folks are asking. So that can come through a variety of different things that they're putting onto the platform. Prashanth Mahendra-RajahCFO at Uber Technologies00:34:59It could be a buy one, get one. It could be, hey, if you spend a certain amount, you get a certain percentage off. We're seeing extremely strong growth in the use of merchant-funded offers. And the tech that we have is allowing them to be quite creative in how they want to apply that and when. I think that's something that's quite unique to us. And as a result of that, we are seeing a very good support of their business growth. And in a time when I think there's more macro concerns around what's happening with some of the large enterprise customers, we are seeing our SMBs really lean in more and are seeing strong growth in this. Prashanth Mahendra-RajahCFO at Uber Technologies00:35:46I'd also say that when we look at the category levels that folks are shopping at on the merchant side, we're continuing to see folks shopping at what we would have categorized as a more expensive, or I think it's a 2 dollar sign category versus the single dollar sign. So we're again seeing folks not trading down at SMBs because some of that is being supported by the RFO or the restaurant-funded offers that we are enabling them to support. Dara KhosrowshahiCEO at Uber Technologies00:36:25Then just on the sponsored listings, part of the business, you know, the growth continues pretty significantly. We're a bit over 1% of delivery gross bookings through advertising. We had a target of 2%+. We think that target is certainly achievable. And actually, for grocer and retail, we think that the number can be well over 2% based on what we see in terms of competitors, what we see in terms of what Amazon is doing. The focus for us with sponsored listings right now is increasing the number of monetizable impressions per user session through introducing new ad formats and placements, and really increasing the monetization of search in a smart way that doesn't hurt the core consumer experience. Dara KhosrowshahiCEO at Uber Technologies00:37:12So we have holdout to make sure that, advertising is a complement to our Eats experience, and at the same time, is a targeted way for merchants to reach our audience. If you think about sponsored listings, sponsored listings tends to kind of improve, audience for a particular merchant, and then merchant-funded offers, because of the price nature of those offers, tend to improve conversion as well. For Uber profitability, you know, the sponsored listings business is more profitable for Uber, but we think merchant-funded offers are a very important strategic part of our drive to improve the affordability of the overall marketplace. Increasingly, we're working with merchants to be able to move money from sponsored listings to, merchant-funded offers in a back and forth in a targeted way, to achieve what their goals are. Dara KhosrowshahiCEO at Uber Technologies00:38:09So, team is doing a great job. We continue to invest in our sales team, and the technical teams continue to ship some pretty impressive product out there. Prashanth Mahendra-RajahCFO at Uber Technologies00:38:20Let me give you one metric we haven't shared before, and that is, globally, restaurant-funded offers or merchant-funded offers have grown 70% year-over-year. John ColantuoniManaging Director at Jefferies00:38:31Thank you, both. Dara KhosrowshahiCEO at Uber Technologies00:38:32All right, can we get a next question? Thank you. Operator00:38:35Your next question comes from the line of Ross Sandler with Barclays. Your line is open. Ross SandlerManaging Director and Senior Equity Research Analyst at Barclays00:38:42Hey, guys. One more follow-up on ads. Lyft talked about getting to 1.6% of gross bookings for ride-hail ads. So I know we talk about delivery ads quite a bit, but what's the status of your ride-hail side advertising business of late? And then, the letter mentioned the Instacart initial kind of read. Can you provide a little more color on what you're seeing thus far from the Instacart partnership? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:39:17Yeah, absolutely. So for mobility ads, we haven't introduced a target in terms of the percentage of Gross Bookings. We are very, very sensitive to the fact that people come to Uber, you know, looking for a ride first. And to the extent that we introduce them to some of the premium brands that are advertising with us, we want to make sure that that experience is an excellent experience for the rider and also an excellent experience for the advertiser. And it's resulting in some very strong ad engagement from riders. Click-through rates are over 2.5% compared to, you know, industry averages that are less than 1%. So I think for us, the focus is more on quality versus quantity. And I think that we'll continue that focus going forward. Dara KhosrowshahiCEO at Uber Technologies00:40:09The contribution of advertising is very, very positive in terms of newer ad formats that we are introducing, improving targeting capabilities, and then also investments in measurement and attribution for our ad partners. So we're very, very happy with the progress here, but I don't want to put a percent target because you know, the experience of the rider comes first. In terms of Instacart and the trends there, we're very encouraged by the trends there. We talked about Instacart baskets being 20% higher than our base basket sizes. And we're seeing the demand come from a lot of suburban markets. You know, it kind of matches the Instacart's kind of geographic penetration. So we do think that the incrementality of the volume from Instacart is quite strong. Dara KhosrowshahiCEO at Uber Technologies00:41:08I'd say so far, the partnership has been an excellent one. Prashanth Mahendra-RajahCFO at Uber Technologies00:41:11Maybe just a reminder to folks, we only went live in the second quarter of 2024, where Uber Eats is live on the Instacart app, so still early days. Dara KhosrowshahiCEO at Uber Technologies00:41:22All right, Prashanth Mahendra-RajahCFO at Uber Technologies00:41:22Can we take our final question? Dara KhosrowshahiCEO at Uber Technologies00:41:24Yeah, sure. Operator00:41:26Your final question comes from the line of Mark Mahaney with Evercore. Your line is open. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:41:32Okay, thanks. Two questions, please. On the TAM comment, Prashanth, that you made earlier, I think you said in your top 10 markets, less than 20% penetration. My recall is that about a year ago, you'd said it was a little under 10%, so you've had nice growth there. Are there particular markets where you could... Like, what are your lead markets? Like, how high have you seen that penetration go? I assume that you're going to be able to go higher than 20%, but any clues you've seen in the markets that you've been in that tell you how high that could go would be helpful. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:42:01And then, could you also talk overall about subsidies and incentives, you know, for drivers and consumers, and where those are now, and is this something that's kind of a flatline expense going forward? Is there more leverage as a percentage of bookings, or even in absolute dollars? How do you think about those incentives and subsidies going forward? Thanks a lot. Prashanth Mahendra-RajahCFO at Uber Technologies00:42:25Yeah. Thank you for the question. I think a good frame of reference or an example to help you with that, Tam, if the United States was to move to the TAM penetration that we're seeing in the UK, that's worth another $13 billion in gross bookings. So, call it 8%-8% or so of our current run rate, just by moving the US to the UK. So we know the opportunity is there. We are seeing Brazil, I think, is another great example, where we're seeing really explosive growth. Prashanth Mahendra-RajahCFO at Uber Technologies00:43:04The frequency in Brazil is a really impressive number that also I think is a great metric for how we have confidence that as we continue to feed more markets and continue to expand our mobility products availability, reliability into more geographies, that is, that's gonna continue to provide runway. And that sort of links into your second question, which is, as we think about balancing supply and demand, the-- I would say the overall sentiment at a global level today is that supply is in a better position than it has historically been. That may not be true in all markets, but at a global level, it is. Prashanth Mahendra-RajahCFO at Uber Technologies00:43:53What that allows us to do is to pivot those incentive dollars into driving demand. And one of the challenges, I think, as the leadership team Uber faces, is we have so many areas that we could pivot those dollars into, and they greatly exceed our ability to fund within our financial framework that we gave you. So much of the time is spent on capital allocation to ensure that we are both making decisions that are right for the near term, in terms of continuing to make sure the market is liquid, but also providing the right incentives that we need to continue to fund future growth products. Prashanth Mahendra-RajahCFO at Uber Technologies00:44:41I think our teens product, as example, which is one that we've launched, and I may ask Deepa to help me here with the metric. I think teens user base, if you, is up, was it up 100%, Deepa? Am I remembering the number right? Yeah, up 100%, was... And that's a relatively new product that we've launched, but that takes some investment to increase awareness about the product. But once you, once you've done that, sorry, it's trips. It was trips that were up. So it's those are the trade-offs, I think, that we continue to make a decision on. This quarter, we opened up Hungary. Prashanth Mahendra-RajahCFO at Uber Technologies00:45:28Sorry, no, we opened up Luxembourg and last quarter, we opened up Hungary. So we're continuing to find new geographies, as well as expanding in existing countries into new areas. So, look for us to continue to make that balance while trying to stay within that great operating framework we gave you of driving, you know, mid- to high-teens GB growth with high thirties to 40% EBITDA over the next three years. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:45:59Thank you, Prashanth. Prashanth Mahendra-RajahCFO at Uber Technologies00:46:00I think with that, we're gonna wrap the call. Did we... We'll turn it back to you, Dara. Dara KhosrowshahiCEO at Uber Technologies00:46:06Yeah, thank you very much, everyone, for joining the call. And, huge thank you to the team at Uber. Prashanth and I and Deepa get to talk to investors about all the accomplishments and the consistent execution of the team, but it's actually the teams on the ground, the technical teams, who deliver in good markets, bad markets, uncertain markets, and we certainly wouldn't have the kind of execution that we've had without everyone at Team Uber contributing. So big thank you to Team Uber, and- Prashanth Mahendra-RajahCFO at Uber Technologies00:46:37Just a reminder, we're gonna be in on the West Coast, in Chicago, in New York, and in Europe in the coming quarter. So very accessible for folks. So reach out to Deepa if you want to see us. Dara KhosrowshahiCEO at Uber Technologies00:46:49Awesome. We'll talk to you next quarter. Thank you again. Operator00:46:53This concludes today's conference call. We thank you for joining. You may now disconnect.Read moreParticipantsExecutivesDara KhosrowshahiCEODeepa SubramanianVP of Investor RelationsPrashanth Mahendra-RajahCFOAnalystsBrian NowakManaging Director at Morgan StanleyDoug AnmuthHead of U.S. Internet Equity Research at J.P. MorganEric SheridanPartner and Managing Director at Goldman SachsJohn ColantuoniManaging Director at JefferiesJustin PostMerrill Lynch Internet Analyst at Bank of AmericaMark MahaneySenior Managing Director and Head of Internet Research at EvercoreNikhil DevnaniSenior Analyst of U.S. Internet at BernsteinRoss SandlerManaging Director and Senior Equity Research Analyst at BarclaysPowered by Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Uber Technologies Earnings HeadlinesHotel Platform Mews Embeds Uber to Transport Guests and Staff38 minutes ago | pymnts.comHotel Platform Mews Embeds Uber to Transport Guests and Staff1 hour ago | pymnts.comThe chokepoint supplier behind SpaceX's $1.75 trillion empireWhen Musk laughed and said 'you need transformers to run transformers,' it wasn't a joke - it was a confession. The world's largest supercomputer requires power equipment that takes 120 weeks to build, and Musk built Colossus in just 122 days. One small American company is positioned to close that gap faster than anyone else, yet Wall Street still prices it like an afterthought. Dylan Jovine has the full story and the ticker.May 26 at 1:00 AM | Behind the Markets (Ad)Uber burned through its entire 2026 AI budget in four months. Now its COO is questioning whether it’s worth it2 hours ago | finance.yahoo.comUber Misrepresented Its Insurance Structure To Legislature To Get Reduced Uninsured Motorist Coverage; Report Requires Answers From Uber, Consumer Watchdog Says2 hours ago | finance.yahoo.comIn an industry-first collaboration, Mews and Uber bring ride booking inside the hotel operating system2 hours ago | finance.yahoo.comSee More Uber Technologies Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Uber Technologies? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Uber Technologies and other key companies, straight to your email. Email Address About Uber TechnologiesUber Technologies (NYSE:UBER) is a technology company that operates a global platform connecting riders, drivers, couriers, restaurants and shippers. Founded in 2009 by Garrett Camp and Travis Kalanick and headquartered in San Francisco, Uber developed one of the first large-scale ride-hailing marketplaces and has since expanded into a broader set of mobility and logistics services. The company completed its initial public offering in 2019 and continues to position its app-based network as a multi-modal transportation and delivery platform. Uber’s principal businesses include mobility services (ride-hailing and shared rides), delivery through Uber Eats, and freight logistics via Uber Freight. The company also offers micromobility options such as electric bikes and scooters in select markets and maintains enterprise-focused services like Uber for Business and healthcare transportation programs. In addition, Uber has invested in advanced technologies related to mapping and autonomy, while partnering with local operators and third-party providers to extend its service footprint and capabilities. Uber operates across a large number of cities and regions worldwide, with a strong presence in North America, Latin America, Europe and parts of the Asia-Pacific region, though it has modified its market footprint over time through strategic exits, sales or local partnerships. Dara Khosrowshahi has served as chief executive officer since 2017, leading a period of corporate restructuring and renewed focus on profitability and regulatory engagement. The company continues to evolve its product mix and market strategy in response to competition, regulatory environments and changing mobility patterns. 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PresentationSkip to Participants Operator00:00:00Hello and welcome. Deepa SubramanianVP of Investor Relations at Uber Technologies00:00:00Thank you, operator. Operator00:00:04Thank you, and welcome to the Uber Q2 2024 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, please press star one on your telephone keypad. I would now like to turn the conference over to Deepa Subramanian, Vice President, Investor Relations, Corporate Finance. Please go ahead. Deepa SubramanianVP of Investor Relations at Uber Technologies00:00:31Thank you, operator. Thank you for joining us today, and welcome to Uber's second quarter 2024 earnings presentation. On the call today, we have Uber CEO, Dara Khosrowshahi, and CFO, Prashanth Mahendra-Rajah. During today's call, we will present both GAAP and non-GAAP financial measures. Additional disclosures regarding these non-GAAP measures, including a reconciliation of GAAP to non-GAAP measures, are included in the press release, supplemental slides, and our filings with the SEC, each of which is posted to investor.uber.com. Certain statements in this presentation and on this call are forward-looking statements. You should not place undue reliance on forward-looking statements. Actual results may differ materially from these forward-looking statements, and we do not undertake any obligation to update any forward-looking statements we make today, except as required by law. Deepa SubramanianVP of Investor Relations at Uber Technologies00:01:29For more information about factors that may cause actual results to differ materially from forward-looking statements, please refer to the press release we issued today, as well as the risks and uncertainties described in our most recent Form 10-K, and in other filings made with the SEC. We published our quarterly earnings press release, prepared remarks, and supplemental slides to our investor relations website earlier today, and we ask you review those documents if you haven't already. We will open the call to questions following brief opening remarks from Dara. With that, let me hand it over to Dara. Dara KhosrowshahiCEO at Uber Technologies00:02:03Thanks, Deepa. Q2 was another record quarter for Uber and further demonstrated our ability to deliver profitable growth at scale. Gross bookings grew 21% on a constant currency basis, consistent with trip growth. Our audience expanded 14%, while frequency grew 6%, supported by 7.4 million drivers and couriers globally. At the same time, adjusted EBITDA grew 71% year-on-year, and we generated record quarterly GAAP operating income. These are super strong results that we're proud of, but I also understand there are two big questions out there that I want to address before we head into Q&A. First, the strength of the consumer and how Uber will perform in a recession. Based on what we're seeing today, the Uber consumer is in great shape. Our audience is bigger than ever and using our services more frequently than ever. Dara KhosrowshahiCEO at Uber Technologies00:02:53While our consumers tend to be higher income, we're not seeing any softness or trading down across any income cohort. If the current macroeconomic fears fail to materialize, we're confident that Uber can perform well because of the countercyclical nature of our platform. On the mobility side, more driver supply brings down prices for riders and improves reliability. On the delivery side, merchants are investing in performance channels like ours for growth, improving selection and affordability for consumers. In fact, in Q2, the number of first-time consumers on Uber Eats in the U.S. was higher than at any point over the past five quarters. It's clear that delivery is much more habitual than many assumed, made even more so by our Uber One membership, which now accounts for 50% of delivery gross bookings. We'll continue to drive consistent top-line growth while expanding GAAP operating income. Dara KhosrowshahiCEO at Uber Technologies00:03:49Our track record of making and then exceeding our commitments should give investors confidence that we built the capital discipline and operational muscle to perform well in any scenario. Second, autonomous. Put simply, Uber is uniquely positioned to offer tremendous value for AV players looking to deploy their technology at scale. While the operation of a ride hail network may seem simple, our technology obscures a huge amount of complexity. We support roughly 1 million trips per hour, and our average ETA globally is approximately 4 minutes. That's possible because of marketplace tech that makes over 10 million predictions per second, and more mundanely, we handle more than 25 million lost items in just last year alone. We also know that a key factor in AV commercialization will be asset utilization. Dara KhosrowshahiCEO at Uber Technologies00:04:43AV players will need to ensure that their expensive assets are being used as close to 24 hours a day as possible, while also managing the daily and weekly peaks and valleys of ride hail activity. Uber can provide enormous demand without AV players needing to invest capital towards acquiring customers or building the marketplace tech that delivers reliability at the standard that consumers have come to expect. Let's all say that Uber will be an indispensable partner for AV players of all sorts. We're in late-stage discussions with additional global AV players to join our platform, and we'll have more announcements in the coming weeks and months. Thanks to the Uber team for another great quarter. With that, operator, let's open the call for questions. Operator00:05:28Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you would like to withdraw your question, simply press star one again. Please ensure that your phone is not on mute when called upon. Your first question comes from the line of Brian Nowak with Morgan Stanley. Your line is open. Brian NowakManaging Director at Morgan Stanley00:05:48Thanks for taking my questions. I have two, the first one on AV. Dara, I appreciate the color and even the extra color in the press release. Question, is there any more detail on what you're seeing in Arizona around incrementality of rides from the partnership? How do we think about sort of the relative unit economics? And philosophically, what is your strategy of reinvesting dollars to sort of drive more AV growth versus sort of delivering profitability? And then the second one on mobility specifically, can you talk to us a little bit about what you're seeing on mobility, MAPC versus frequency growth drivers? Just so we can sort of break apart what's driving that growth in the quarter for mobility. Thanks. Dara KhosrowshahiCEO at Uber Technologies00:06:33Sure. Absolutely, Brian. Thanks for the question. So I don't wanna speak specifically to Arizona, because obviously we have Waymo as a partner there, and I wanna hold confidentiality, et cetera, as any partner should. But when we look more broadly at our operations with the various AV players that we see, what we do see is that the utilization that these AV players are able to develop on our network is significantly higher than the utilization we believe that they're able to run out without a network on a 1P basis. So 3P utilization is significantly higher than 1P utilization. And if you think about the role of the marketplace, the role of the marketplace is to drive utilization of fixed assets. Dara KhosrowshahiCEO at Uber Technologies00:07:24I mean, it's in the end, it's why a McDonald's or a Starbucks or even Domino's now works with us. They have direct channels to consumers, but they also work through the marketplace to bring demand, more demand to their stores, so to speak. And we think the same will be true of AV players, which is as long as we're able to drive higher utilization, and the utilization that we drive, the incrementality, we think significantly exceeds the take rate that we will charge. On average for mobility, not including insurance costs, our global take rate is around 20%, so you'd have to drive 25% increase in utilization. We believe that those utilization numbers are possible, and we think that we can exceed those kinds of utilization numbers. So right now, the economics and the math are definitely working. Dara KhosrowshahiCEO at Uber Technologies00:08:13I think the additional benefit that we bring to these players is, we have a dynamic dispatch model that can determine what are the pickups and dropoffs that an autonomous player can effectively play with. You know, the pickup point is easy, it's within a block, same thing with the drop-off points. And then what are the circumstances when we should dispatch human for a particular pickup or a drop-off if the route is complex or the pickup or drop-off has some special circumstances? So we're able to essentially allow autonomous players to dispatch in situations where we know that they will succeed. So all in all, the early data is quite encouraging. And as I said, we've had lots of discussions with other players out there. Dara KhosrowshahiCEO at Uber Technologies00:09:00We don't think this will be a winner-take-all market, and we think that we will continue to have the most liquid and largest marketplace that will have humans and AV players as part of it during this pretty long hybrid period as autonomous is developing, and regulators are trying to figure out exactly how to regulate it. Prashanth, do you want to take the second one? Prashanth Mahendra-RajahCFO at Uber Technologies00:09:25I will. I will. Thanks, Dara. I think, Brian, your question was on, mobility growth. So maybe I'll, I'll start with just, restating how we did for, Q2 and our outlook for Q3. So for Q2, the results that we printed, if you do it at a constant currency, very strong at, at 27% year-over-year growth. For Q3, we're looking for sort of a repeat in that, mid-20s range, again, on a constant currency basis. But when you, dig into why do we have, such confidence in the mobility business, I would take you back to the, framework we talked about in February, that mobility, over the 3 years that we gave you, should be growing at the mid-teens or better. And that's coming from a couple items. Prashanth Mahendra-RajahCFO at Uber Technologies00:10:12On the user side, we still believe that we have a pretty massive TAM that we can go after. We're continuing to drive product innovation, and we talked about a couple of those at GO-GET earlier this year, and we're continuing to find new demographics and areas to continue to expand in. Maybe one data point on TAM that I think is helpful for folks is our monthly penetration of consumers, and we define that as folks who are over 18 years is less than 20% across our top 10 countries. So a lot of room to run there. Another key driver will be frequency, which I think folks understand to be how many times our monthly actives engage with the platform. Prashanth Mahendra-RajahCFO at Uber Technologies00:10:58We are launching new products, continuing to improve reliability so that, when you, when you call for an Uber, we're able to get you one at a time that you're looking for, and of course, the benefits of membership. Only about, about half of our riders, take one to two trips per month. So again, plenty of upside there to continue to drive this as a more frequent, frequent daily use case. Dara KhosrowshahiCEO at Uber Technologies00:11:23And then, Brian, I think you, you'd asked about our strategy to reinvest, to drive, let's say, AV growth versus profits. You know, generally, we are able to lean into our newer products. So, for example, if you look at, Moto, which are two-wheelers in, Latin America and a number of developing countries, if you look at our shared product, UberX Share, where we get more than one passenger in a vehicle or even taxis, those newer products are growing faster than the base business, and their margins are substantially lower than the base business. Dara KhosrowshahiCEO at Uber Technologies00:11:58But we're able to, as we scale, we're able to leverage our cost base, our technology improvements in terms of targeting, in terms of CPT, allow us to have a profit envelope to be able to reinvest into our newer products, AV is one of those new products, while overall increasing profit margins. This is something that we've been doing for years, and we think AV will be part of the same equation. So I don't, you know, AV is not something that we're gonna look to make substantial profits for, from over the next five to 10 years, and that's just fine because we'll be able to build a lot of liquidity in the marketplace to kind of continue along the path that we have been operating in over the past five years. Brian NowakManaging Director at Morgan Stanley00:12:43Great. Thank you both. Dara KhosrowshahiCEO at Uber Technologies00:12:45You're welcome. Next question. Operator00:12:47Your next question comes from the line of Doug Anmuth with J.P. Morgan. Your line is open. Doug AnmuthHead of U.S. Internet Equity Research at J.P. Morgan00:12:54Thanks so much for taking the questions. Dara, can you just talk more about the importance of the BYD partnership as you bring new EVs into global markets, and then perhaps how that can tie into AV over time? And then, Prashant, just if you could talk more about the drivers of delivery, profitability, good upside there in the quarter, and what gives you the confidence on the clear path to EBITDA profit in, in grocery and retail as well? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:13:24Yeah, absolutely, Doug. So I'll, I'll start with BYD. You know, the electrification of our fleet is an incredibly important initiative for us. We are, if you look at Uber, Uber drivers are switching over to electric at five times kind of the speed that normal drivers are. And if there's any driver that you want to switch over to EVs, it's an Uber driver, because Uber drivers also drive around five times the miles of a regular driver as well. So it's a very targeted segment that we're going after, and we're hoping that kind of governments can help us go after as well. The number one reason why some drivers hesitate to move over to EVs is affordability. Dara KhosrowshahiCEO at Uber Technologies00:14:12And the fact is that BYD, when you look at cost and quality, BYD is really second to none in terms of any manufacturer out there. We're very, very excited with the partnership. We are, we believe we're gonna bring over 100,000 new BYD EVs onto the Uber platform across some of our most important global markets out there. And, you know, we've always talked about climate being a team sport. We are going to be leaders in terms of climate change, and having BYD as a partner is just terrific to see. More recently, BYD has committed to very, very significant investments in the AV space, and judging from what they have accomplished in the EV space, I would not, I would make a bet on them in AV as well. Dara KhosrowshahiCEO at Uber Technologies00:15:04But the investment that they're making in AV is in the $ billions, and we're very much looking forward to partnering with them on both EVs and AVs. Prashanth? Prashanth Mahendra-RajahCFO at Uber Technologies00:15:14Yeah. Dara KhosrowshahiCEO at Uber Technologies00:15:15Go on. Prashanth Mahendra-RajahCFO at Uber Technologies00:15:15Yes. So I think your question was on delivery profitability. So, although we don't, we don't wanna draw attention to incremental margins, we did have a pretty terrific quarter for incremental margins in delivery, 10% for the second quarter. So putting a little context around that. We are clearly seeing the benefits of scale as it runs through the delivery business, and we still have many levers that we're continuing to tune to drive that profitability in delivery. That includes some incredible tech that the team has built that continues to drive down the cost per transaction, cost per trip in terms of operational improvements. We've got great improvements in advertising. Prashanth Mahendra-RajahCFO at Uber Technologies00:16:03I think we mentioned in the prepared remarks, that's now running in excess of $1 billion on a run rate basis, and continuing to find ways both operationally and with tech to reduce some of our other costs, like refunds and appeasements, which are still a bit of a drag on the delivery segment. The fact that we were able to grow delivery profitability while continuing to have very strong growth in grocery really is a good indicator of how much strong growth we're seeing in that profitability. I think delivery EBITDA was up, like, 25 basis points sequentially, and that is despite grocery growing at a pretty substantially faster rate than delivery. Prashanth Mahendra-RajahCFO at Uber Technologies00:16:54It, in grocery profitability, it's what we've talked about in the, in the past. It is, you know, using the power of the platform, we can bring down the customer acquisition costs, and drive those cost efficiencies. We've got 15% of our Eats customers are now using grocery. That's up about 200 basis points year-over-year, as of, as of middle of the year. And we're seeing retention on grocery also improving. I mentioned the ads revenue, and then also, starting, given that we... our selection's improving, we're also driving down consumer promotions, and continuing to add more and more merchants onto the, to the platform. We mentioned Costco, and I think in the, in the press release or prepared remarks, we also mentioned a couple other grocers. Prashanth Mahendra-RajahCFO at Uber Technologies00:17:41So, all in all, things are on track to where we gave you in our, in our, three-year model, and grocery is continuing to be a strong story for our delivery business. Prashanth Mahendra-RajahCFO at Uber Technologies00:17:52Just one very encouraging trend on grocery and retail is that ad spend on grocery and retail more than tripled on a year-on-year basis. Obviously, that's a very high-margin product, and we are continuing to expand kind of our CPG product now into a bunch of new countries. So the momentum there is terrific to see. Prashanth Mahendra-RajahCFO at Uber Technologies00:18:12Next question, please. Doug AnmuthHead of U.S. Internet Equity Research at J.P. Morgan00:18:14Thank you. Operator00:18:14Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is open. Eric SheridanPartner and Managing Director at Goldman Sachs00:18:21Thanks so much for taking the questions. Maybe two, if I could, coming back to the delivery business. Building on the last set of comments, how do you think about the potential longer term for increased utility, increased frequency as you layer more supply into the delivery network, and, and, and what you continue to learn about the relationship of evolving the experience for consumers and what it means for, for platform growth over a longer period of time? And then also on the delivery side, we've seen a lot of market consolidation and market rationalization in some of the countries around the globe. How do you think about the asset portfolio on delivery and your current marketing positioning against some of those industry dynamics you're seeing on the capital side? Thanks so much. Dara KhosrowshahiCEO at Uber Technologies00:19:06Yeah, Eric, so what we're seeing in terms of delivery is the long-term growth is incredibly promising, and especially our ability to expand into the adjacent category of grocery and retail. You know, the grocery and retail TAM is actually bigger than the online food delivery TAM. So not only do we believe we've got a long runway in online food delivery, but we're just getting started as it relates to grocery and retail. We now have 1.1 million merchants on the platform. It's up 13%. Dara KhosrowshahiCEO at Uber Technologies00:19:43Our merchant penetration in most countries still is very low, well under 50%, and every time we add a merchant, because we have more diversity of choice, average conversion tends to improve for consumers who are kind of searching for their favorite restaurant or, you know, favorite dessert place. And each merchant gives us actually another item to market against as it relates to search engine optimization or search engine marketing in third-party channels as well. So new merchants add, you know, conversion, choice, and actually are another item to market against, and we're very, very long way in terms of full merchant penetration in the marketplace. And it all results in eater retention being up globally in every single mega region that just in June on a year-on-year basis. Dara KhosrowshahiCEO at Uber Technologies00:20:42So right now we believe there's a very, very long run rate for growth. The more consumers use our product in a multiproduct way, whether it's a mobility user using delivery or a delivery user buying from grocery or and retail, the more they transact on the platform. Multiproduct consumers spend three times more than single-product consumers. And for us, the more products we add to the marketplace, the more kind of this benefit adds onto it, and then on top of that, you add our membership product as well, which is now over 50% of bookings. So you know, the volumes are strong. We are not having to buy our way into strong volumes. Dara KhosrowshahiCEO at Uber Technologies00:21:30We're kind of earning our way into strong volumes, and I think the fundamentals are gonna be there for some time to come. In terms of our portfolio, we had made the strategic decision a few years ago, it's probably three or four years ago, to exit markets that we didn't think we could either be the number one or number two, and if we're the number two, the ability to move to a number one position. We've gained category position delivery in every one of our top 10 markets on a year-on-year basis. It's a function of the great execution of our operations team, the technology that we're shipping, and then the power of the platform. There's no other global player who operates both in mobility and delivery or has as broad a platform as we do. Dara KhosrowshahiCEO at Uber Technologies00:22:15So we're very happy with our portfolio, so to speak, and I think the results speak for themselves. Prashanth Mahendra-RajahCFO at Uber Technologies00:22:23Eric, as someone who's been in the business coming up now on my one-year anniversary soon, I'm surprised... I was surprised to learn how sticky the food delivery business is. It is very habitual, and we've got great data that shows that stickiness is improving. I think I look back at five, six quarters of data, and it gets better every quarter in terms of eater retention. So there's clearly the trajectory to follow what we're seeing in mobility. Eric SheridanPartner and Managing Director at Goldman Sachs00:22:51Appreciate it. Thank you. Dara KhosrowshahiCEO at Uber Technologies00:22:54You're welcome. Next question. Operator00:22:56Your next question comes from the line of Justin Post with Bank of America. Your line is open. Justin PostMerrill Lynch Internet Analyst at Bank of America00:23:03Thank you. I wonder if you could revisit the consumer downturn scenario. What would you expect to happen for mobility if we do have a recession or a bigger downturn as far as maybe trade down or looking for lower price rides, the impact on bookings and profitability? And then, Prashanth, maybe you could talk about looks like you've turned the corner on independent contractor deals in Massachusetts, other areas. What happens to your costs when you sign those deals? And can you cover it with higher fees or what are the business model impacts of signing those deals? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:23:41Yeah, Justin, in terms of a consumer downturn scenario on mobility, we've seen these circumstances in a number of markets. Latam has been through a bunch of cyclical trends, et cetera. And usually a downturn, kind of the leading indicator of a downturn is a weak job market. We might be seeing it in some of the Western markets. We might not. It's very difficult to tell. But when there's a weaker job market, typically, our driver supply on the mobility side significantly improves. We're a very, very flexible work platform. Average earnings per utilized hour for drivers in the U.S., for example, is $33 per utilized hour. So, it's highly flexible, and the earnings per utilized hour are strong. So typically, what we see is improvement in driver supply. Dara KhosrowshahiCEO at Uber Technologies00:24:35As driver supply improves, surge comes down, ETAs improve, the service itself becomes more compelling. And as a result, volumes typically turn out to be quite quite sticky. In addition to those trends, we are actively investing in affordability, right? The membership program essentially brings prices down for both mobility and delivery, and we're investing in products such as two-wheelers and three-wheelers, and UberX Share, all of whom, you know, provide discounts of, let's say, 25%-50%, of, of, let's say, the price of an UberX as well. So we think that we can thrive in upturns and downturns, and I think that the team has proven that they've, you know, kind of execution capability to be able to perform in any kind of a market. And listen, we are... Dara KhosrowshahiCEO at Uber Technologies00:25:31We're watching trends very, very quickly, and I do believe we'll be able to adjust as needed. Prashanth, you wanna talk about Massachusetts? Prashanth Mahendra-RajahCFO at Uber Technologies00:25:39Yeah, I will. I will. Justin, maybe I'll also just start by just reminding folks that we have three different, sort of broad models on how we go to market in our operating frameworks for folks. So we have the traditional independent contractor, which is how most people think of Uber, and that is the model that the company was largely built on. And then over time, we've adapted to now the IC Plus model, which is what you referred to for Massachusetts, and that's where we enter into agreements to provide some level of benefits. Prashanth Mahendra-RajahCFO at Uber Technologies00:26:12And then there are still some countries that we use a fleet model, where an independent company sort of handles the actual execution on the ground, and we serve as feeding them the global or the in-country demand or the in-city demand. So specifically in Massachusetts, we reached a deal with the Attorney General that settled on a set of standards for earners. That includes, you know, how we measure or how we define time on the platform, certain healthcare, family, and medical leave benefits as well. As a consequence for that, the Attorney General dropped their action against Uber, and we're no longer in pursuit of a ballot issue in Massachusetts like we had very successfully done in California. Prashanth Mahendra-RajahCFO at Uber Technologies00:27:05The consequence of that is we will factor that into our operating model in Massachusetts. But as we've said back in February on our Investor Day, we still have plenty of runway to focus on operational costs. So while this will be built into the cost structure that we push to the market, we continue to believe that there's plenty of runway ahead for us to continue to drive down our operating costs through the support costs and payments and a variety of other measures that we continue to sort of grind out those basis points that will continue to make Uber an affordable option for all. Justin PostMerrill Lynch Internet Analyst at Bank of America00:27:46Great. Thank you. Dara KhosrowshahiCEO at Uber Technologies00:27:48You're welcome. Next question, operator. Operator00:27:51Your next question comes from the line of Nikhil Devnani with Bernstein. Your line is open. Nikhil DevnaniSenior Analyst of U.S. Internet at Bernstein00:27:58Hi, thanks for taking my question. Dara, I wanted to ask a two-parter on autonomous vehicles. First, can you help us understand how much of the rideshare demand takes place during peak hours and mornings and evenings? I would imagine that utilization math around the peak is, is really at the core of your value prop to partners. And then second, the partnership model makes a lot of sense to us for both sides, but there is a world where providers choose not to partner, they choose to compete more directly. So my second question is around, I guess, what the plan B is for Uber in the event that leading players choose not to extend partnerships or engage in partnerships. How do you navigate that scenario? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:28:38Yeah. Yeah, absolutely. So in terms of peak and trough, while we haven't disclosed the numbers, there are very, very significant peaks during rush hour, both ways, obviously in the mornings and going home during kind of after-hours drinks, et cetera. We are able to shape demand and supply, actually, you know, demand through search when we need to, and supply, obviously positioning our drivers through incentives, either on a temporal basis or on a geographic basis, you know, if there's a concert going on, et cetera. The good news there is that through our incentive structure, essentially those are variable costs for us. We will pay more during those peak periods, and then when we don't need supply, we can take incentives out. Dara KhosrowshahiCEO at Uber Technologies00:29:34So we have a model where essentially we're able to shape supply to match demand in a variable basis. I think that in an AV world, the car is there at all times, so you kind of have to pay the overhead for the car and the amortization of the car during all periods. So we think kind of a hybrid network that consists of both humans and robots can handle the peaks and valleys much more effectively than a pure play network. In terms of AV partnerships, et cetera, I would tell you, Nikhil, that based on the conversations that we're having, we are highly, highly confident of being able to acquire AV content, if you want to call it that, on a global basis. Dara KhosrowshahiCEO at Uber Technologies00:30:24The fact is, this is not turning out to be a winner-take-all market. Originally, I think that was the concept why Uber wanted to develop the technology itself, but every single OEM is investing in some L2 or L3 technology. If you look at some of the newer tech coming in terms of imitation learning, technologies that have taken kind of the imagination of folks through LLMs, that same technology, we believe, can potentially introduce a new wave of AV through imitation learning at substantially lower capital costs than was necessary historically. So we think there are going to be many, many AV providers. Dara KhosrowshahiCEO at Uber Technologies00:31:10If there are many, many AV providers, the marketplace, and our marketplace is by far the largest marketplace, global marketplace, both for mobility, delivery and then freight as well, you know, the marketplace will have a very, very strong position. So at this point, we don't see any signal that a plan B will be necessary. Also take note that we have investments, strategic investments in a number of AV players. Aurora, we're working with Waymo, for example, and there are other investments that we have in AV players to make sure that kind of plan A is the right plan going forward. So far, I'd say so good, and as I mentioned in my remarks, we will have more partnerships to announce in the next week, weeks and months. Dara KhosrowshahiCEO at Uber Technologies00:31:58I think, you know, the market will see, and you'll see that plan B isn't necessary. Nikhil DevnaniSenior Analyst of U.S. Internet at Bernstein00:32:03Thanks, Dara. Dara KhosrowshahiCEO at Uber Technologies00:32:05You're very welcome. Next question, operator? Operator00:32:08Your next question comes from the line of John Colantuoni with Jefferies. Your line is open. John ColantuoniManaging Director at Jefferies00:32:16Great. Thanks for taking my questions. Given the continued progress on mobility frequency, I was curious if we could go back to some disclosure you provided about a year ago, showing that pre-COVID cohorts in the U.S. and Canada had lower frequency than more recent cohorts. How has mobility usage progressed over across cohorts over the past year? And what does that progression tell you about the opportunity to keep driving frequency higher through multi-product adoption? And second, the $1 billion in advertising run rate suggests over 50% growth, which is really strong, but a bit of a deceleration from more like 80% exiting last year. Talk about how restaurants are balancing investments in sponsored listings versus merchant-funded offerings, which you mentioned grew over 70% year-over-year in the quarter. Thanks. Dara KhosrowshahiCEO at Uber Technologies00:33:13So John, in terms of mobility frequency, while we're not going to disclose, you know, specifically what frequency looks like, I would say that when we look at lower cost products, when you look at UberX Share, hailables, two-wheelers, three-wheelers, the frequency of some of the newer products is significantly higher than the frequency of, call it, the X products, et cetera. When you look at the overall frequency numbers for both mobility and delivery, they're up on a year-on-year basis. It is absolutely helped by multi-product usage. It is absolutely helped by membership as well. So whether you look at cohorts, whether you look at new customers, high income, low income, the frequency numbers for us in both mobility and delivery are very, very constructive. You want to talk about ads, Prashant? Prashanth Mahendra-RajahCFO at Uber Technologies00:34:07Sure. So I think the question, your question, John, again, was on merchant-funded offers, how are we... or on offers in general, how are we seeing that in on an impact for the business? So I would tell you to think about it in two elements. First, as we're able to drive, and we see very strong cooperation from merchants in using merchant-funded offers to drive their demand, it is actually being a very helpful way for them to address their need to attack the affordability question that folks are asking. So that can come through a variety of different things that they're putting onto the platform. Prashanth Mahendra-RajahCFO at Uber Technologies00:34:59It could be a buy one, get one. It could be, hey, if you spend a certain amount, you get a certain percentage off. We're seeing extremely strong growth in the use of merchant-funded offers. And the tech that we have is allowing them to be quite creative in how they want to apply that and when. I think that's something that's quite unique to us. And as a result of that, we are seeing a very good support of their business growth. And in a time when I think there's more macro concerns around what's happening with some of the large enterprise customers, we are seeing our SMBs really lean in more and are seeing strong growth in this. Prashanth Mahendra-RajahCFO at Uber Technologies00:35:46I'd also say that when we look at the category levels that folks are shopping at on the merchant side, we're continuing to see folks shopping at what we would have categorized as a more expensive, or I think it's a 2 dollar sign category versus the single dollar sign. So we're again seeing folks not trading down at SMBs because some of that is being supported by the RFO or the restaurant-funded offers that we are enabling them to support. Dara KhosrowshahiCEO at Uber Technologies00:36:25Then just on the sponsored listings, part of the business, you know, the growth continues pretty significantly. We're a bit over 1% of delivery gross bookings through advertising. We had a target of 2%+. We think that target is certainly achievable. And actually, for grocer and retail, we think that the number can be well over 2% based on what we see in terms of competitors, what we see in terms of what Amazon is doing. The focus for us with sponsored listings right now is increasing the number of monetizable impressions per user session through introducing new ad formats and placements, and really increasing the monetization of search in a smart way that doesn't hurt the core consumer experience. Dara KhosrowshahiCEO at Uber Technologies00:37:12So we have holdout to make sure that, advertising is a complement to our Eats experience, and at the same time, is a targeted way for merchants to reach our audience. If you think about sponsored listings, sponsored listings tends to kind of improve, audience for a particular merchant, and then merchant-funded offers, because of the price nature of those offers, tend to improve conversion as well. For Uber profitability, you know, the sponsored listings business is more profitable for Uber, but we think merchant-funded offers are a very important strategic part of our drive to improve the affordability of the overall marketplace. Increasingly, we're working with merchants to be able to move money from sponsored listings to, merchant-funded offers in a back and forth in a targeted way, to achieve what their goals are. Dara KhosrowshahiCEO at Uber Technologies00:38:09So, team is doing a great job. We continue to invest in our sales team, and the technical teams continue to ship some pretty impressive product out there. Prashanth Mahendra-RajahCFO at Uber Technologies00:38:20Let me give you one metric we haven't shared before, and that is, globally, restaurant-funded offers or merchant-funded offers have grown 70% year-over-year. John ColantuoniManaging Director at Jefferies00:38:31Thank you, both. Dara KhosrowshahiCEO at Uber Technologies00:38:32All right, can we get a next question? Thank you. Operator00:38:35Your next question comes from the line of Ross Sandler with Barclays. Your line is open. Ross SandlerManaging Director and Senior Equity Research Analyst at Barclays00:38:42Hey, guys. One more follow-up on ads. Lyft talked about getting to 1.6% of gross bookings for ride-hail ads. So I know we talk about delivery ads quite a bit, but what's the status of your ride-hail side advertising business of late? And then, the letter mentioned the Instacart initial kind of read. Can you provide a little more color on what you're seeing thus far from the Instacart partnership? Thank you. Dara KhosrowshahiCEO at Uber Technologies00:39:17Yeah, absolutely. So for mobility ads, we haven't introduced a target in terms of the percentage of Gross Bookings. We are very, very sensitive to the fact that people come to Uber, you know, looking for a ride first. And to the extent that we introduce them to some of the premium brands that are advertising with us, we want to make sure that that experience is an excellent experience for the rider and also an excellent experience for the advertiser. And it's resulting in some very strong ad engagement from riders. Click-through rates are over 2.5% compared to, you know, industry averages that are less than 1%. So I think for us, the focus is more on quality versus quantity. And I think that we'll continue that focus going forward. Dara KhosrowshahiCEO at Uber Technologies00:40:09The contribution of advertising is very, very positive in terms of newer ad formats that we are introducing, improving targeting capabilities, and then also investments in measurement and attribution for our ad partners. So we're very, very happy with the progress here, but I don't want to put a percent target because you know, the experience of the rider comes first. In terms of Instacart and the trends there, we're very encouraged by the trends there. We talked about Instacart baskets being 20% higher than our base basket sizes. And we're seeing the demand come from a lot of suburban markets. You know, it kind of matches the Instacart's kind of geographic penetration. So we do think that the incrementality of the volume from Instacart is quite strong. Dara KhosrowshahiCEO at Uber Technologies00:41:08I'd say so far, the partnership has been an excellent one. Prashanth Mahendra-RajahCFO at Uber Technologies00:41:11Maybe just a reminder to folks, we only went live in the second quarter of 2024, where Uber Eats is live on the Instacart app, so still early days. Dara KhosrowshahiCEO at Uber Technologies00:41:22All right, Prashanth Mahendra-RajahCFO at Uber Technologies00:41:22Can we take our final question? Dara KhosrowshahiCEO at Uber Technologies00:41:24Yeah, sure. Operator00:41:26Your final question comes from the line of Mark Mahaney with Evercore. Your line is open. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:41:32Okay, thanks. Two questions, please. On the TAM comment, Prashanth, that you made earlier, I think you said in your top 10 markets, less than 20% penetration. My recall is that about a year ago, you'd said it was a little under 10%, so you've had nice growth there. Are there particular markets where you could... Like, what are your lead markets? Like, how high have you seen that penetration go? I assume that you're going to be able to go higher than 20%, but any clues you've seen in the markets that you've been in that tell you how high that could go would be helpful. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:42:01And then, could you also talk overall about subsidies and incentives, you know, for drivers and consumers, and where those are now, and is this something that's kind of a flatline expense going forward? Is there more leverage as a percentage of bookings, or even in absolute dollars? How do you think about those incentives and subsidies going forward? Thanks a lot. Prashanth Mahendra-RajahCFO at Uber Technologies00:42:25Yeah. Thank you for the question. I think a good frame of reference or an example to help you with that, Tam, if the United States was to move to the TAM penetration that we're seeing in the UK, that's worth another $13 billion in gross bookings. So, call it 8%-8% or so of our current run rate, just by moving the US to the UK. So we know the opportunity is there. We are seeing Brazil, I think, is another great example, where we're seeing really explosive growth. Prashanth Mahendra-RajahCFO at Uber Technologies00:43:04The frequency in Brazil is a really impressive number that also I think is a great metric for how we have confidence that as we continue to feed more markets and continue to expand our mobility products availability, reliability into more geographies, that is, that's gonna continue to provide runway. And that sort of links into your second question, which is, as we think about balancing supply and demand, the-- I would say the overall sentiment at a global level today is that supply is in a better position than it has historically been. That may not be true in all markets, but at a global level, it is. Prashanth Mahendra-RajahCFO at Uber Technologies00:43:53What that allows us to do is to pivot those incentive dollars into driving demand. And one of the challenges, I think, as the leadership team Uber faces, is we have so many areas that we could pivot those dollars into, and they greatly exceed our ability to fund within our financial framework that we gave you. So much of the time is spent on capital allocation to ensure that we are both making decisions that are right for the near term, in terms of continuing to make sure the market is liquid, but also providing the right incentives that we need to continue to fund future growth products. Prashanth Mahendra-RajahCFO at Uber Technologies00:44:41I think our teens product, as example, which is one that we've launched, and I may ask Deepa to help me here with the metric. I think teens user base, if you, is up, was it up 100%, Deepa? Am I remembering the number right? Yeah, up 100%, was... And that's a relatively new product that we've launched, but that takes some investment to increase awareness about the product. But once you, once you've done that, sorry, it's trips. It was trips that were up. So it's those are the trade-offs, I think, that we continue to make a decision on. This quarter, we opened up Hungary. Prashanth Mahendra-RajahCFO at Uber Technologies00:45:28Sorry, no, we opened up Luxembourg and last quarter, we opened up Hungary. So we're continuing to find new geographies, as well as expanding in existing countries into new areas. So, look for us to continue to make that balance while trying to stay within that great operating framework we gave you of driving, you know, mid- to high-teens GB growth with high thirties to 40% EBITDA over the next three years. Mark MahaneySenior Managing Director and Head of Internet Research at Evercore00:45:59Thank you, Prashanth. Prashanth Mahendra-RajahCFO at Uber Technologies00:46:00I think with that, we're gonna wrap the call. Did we... We'll turn it back to you, Dara. Dara KhosrowshahiCEO at Uber Technologies00:46:06Yeah, thank you very much, everyone, for joining the call. And, huge thank you to the team at Uber. Prashanth and I and Deepa get to talk to investors about all the accomplishments and the consistent execution of the team, but it's actually the teams on the ground, the technical teams, who deliver in good markets, bad markets, uncertain markets, and we certainly wouldn't have the kind of execution that we've had without everyone at Team Uber contributing. So big thank you to Team Uber, and- Prashanth Mahendra-RajahCFO at Uber Technologies00:46:37Just a reminder, we're gonna be in on the West Coast, in Chicago, in New York, and in Europe in the coming quarter. So very accessible for folks. So reach out to Deepa if you want to see us. Dara KhosrowshahiCEO at Uber Technologies00:46:49Awesome. We'll talk to you next quarter. Thank you again. Operator00:46:53This concludes today's conference call. We thank you for joining. You may now disconnect.Read moreParticipantsExecutivesDara KhosrowshahiCEODeepa SubramanianVP of Investor RelationsPrashanth Mahendra-RajahCFOAnalystsBrian NowakManaging Director at Morgan StanleyDoug AnmuthHead of U.S. Internet Equity Research at J.P. MorganEric SheridanPartner and Managing Director at Goldman SachsJohn ColantuoniManaging Director at JefferiesJustin PostMerrill Lynch Internet Analyst at Bank of AmericaMark MahaneySenior Managing Director and Head of Internet Research at EvercoreNikhil DevnaniSenior Analyst of U.S. Internet at BernsteinRoss SandlerManaging Director and Senior Equity Research Analyst at BarclaysPowered by
