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Thank you for joining us today, and welcome to Uber's first quarter twenty twenty five earnings presentation. On the call today, we have Uber CEO, Dara Khosra Shahi and CFO, Prashant Mahendra Raja. 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 and actual results may differ materially from these forward looking statements. We do not undertake any obligation to update any forward looking statements we make today, except as required by law. For 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 risk and uncertainties described in our most recent Form 10 ks and in our 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 to review those documents if you haven't already.
11m 24s
We will open the call to questions following brief opening remarks from Dara. With that, let me hand it over to Dara.
11m 31s
Thanks, Balaji. We're off to a strong start this year against the dizzying backdrop of headlines on trade and economic policy. Each component of our multiyear growth framework is humming. Our audience grew 14% to 170,000,000 monthly active consumers, Engagement strength continued with trips up 18% and with retention rates hitting all time highs globally. Gross bookings grew in line with trips fueled by strength across both mobility and delivery. We see this as robust healthy growth, growth that's not coming that's coming from engagement and frequency not just price. We think that's the right way to maximize long term free cash flow per share. And in Q1, we generated record EBITDA of $1,900,000,000 up 35% year on year and free cash flow of $2,300,000,000 Uber team has been a major execution mode. We launched with Waymo in Austin with around a hundred cars that are all exceptionally utilized We announced five AD partnerships with deployments to come in The US, Europe, and The Middle East We signed a partnership with OpenTable to integrate dining, delivery, and transportation for our customers we went live with our Delta SkyMiles partnership. And we announced the acquisition of Trendyol Go, to supercharge our future growth.
12m 48s
In Turkey. And that is all just in the last two months. Looking ahead, our Q2 outlook should underscore our expectation to reliably deliver more of the same strong top line growth combined with even stronger profitability growth setting us well for the seasonally stronger second half of the year. And as I said to my team, feel great about where we stand. We're on solid footing with a clear strategy and ambitions that have never been higher. And that's why I'm emphasizing that good is not going to be good enough. We need to be great to continue to deliver for the people and cities that we serve. And of course for all of you. So with that, let's get some questions going. Thank you.
13m 30s
Operator, we're ready.
13m 32s
Thank you. Your first question comes from the line of Doug Anmuth with JPMorgan. Please go ahead.
13m 39s
Thanks for taking the questions. I have two. First, just on mobility as you've worked to keep prices low. Curious what kind of elasticity you think you're seeing terms of the response and how that's showing up in Rides?
13m 53s
And then on AV, you talked about almost 100 cars in Austin on the way to hundreds. What are you seeing there in terms of utilization of those Waymo's relative to some of their other markets?
14m 5s
Thanks.
14m 6s
Yeah. Absolutely. So, Doug, on on mobility, the elasticity that that we're seeing is is similar to, the past, you you know, usually for a dollar of increase in terms of price [indiscernible] are negatively affected. Now there's short term elasticity and long term elasticity. There's elasticity that you see in session, and then we think there's longer term elasticity, which is as you tend to kinda get used to prices not increasing as much as they were in the past couple of years, how does your how do your habits change? How does sessioning change? So we're happy with the results that we saw in terms of the pricing that we were able to deliver to the consumers as we saw the insurance headwinds ease a little bit and hopefully we'll keep that going. There was also kind of a mix shift in terms of trips a bit more growth internationally than The US especially in the travel sector. That affected overall price mix. So to speak. But so far, I'd say so good in terms of, elasticity. In terms of AV, in in Austin, we're very, very encouraged with, what we're seeing. Obviously, Waymo has a safety track record second to none.
15m 23s
Consumers are loving the product. Often rates are very, very healthy, and the ratings are healthy. The team on the ground is doing a terrific job in terms of repairs and cleaning and recharging the cars, etcetera, to make sure that the Waymos are available for rides. And then when the Waymos are available for rides, they are very, very busy. So we're seeing very high utilization of the vehicles in terms of trips per vehicle per day. As a matter of fact, the average way though in Austin is busier than 90% of Austin drivers is defined by kind of the number of trips per day per waymo as well. So very, very encouraging early days. We are going to continue to increase the vehicle count in Austin, and we're super excited for expansion in Atlanta as well as some of the other AV announcements that we've made and the expansion that we see in The US and especially outside The US as well.
16m 24s
Thank you, You're welcome. Next question? Next question comes from the line of Eric Sheridan with Goldman Sachs. Please go ahead.
16m 36s
Thank you so much for taking my question. I want to know if we could go a little bit deeper on the broader competitive landscape. If you could give us a bit of an update on what you're seeing competitively, especially around either pricing dynamics or incenting supply and demand across both mobility and delivery if there were any specific geos you wanted to call out from a competitive intensity standpoint? Thank you.
16m 57s
Yeah. Eric, this these markets continue to be very competitive on a global basis. In terms of mobility, we've got a strong competitor, domestically here in in Lyft. I think we're more focused on competing with each other on service, on quality, Obviously, insurance is something that's hit both of us as well. So I'd say the competitive intensity in The US is pretty consistent. And then internationally, of course, we got both in Europe and DD and Latin America. They're strong competitors. They continue to, focus on expansion and I think as you see about our results, you know, we're the number one player in the vast majority of market in which we operate. And even at a very competitive market, our category position continues to be market leading. And then the same in delivery as well. Obviously, The US market is highly competitive. We're seeing terrific growth both in terms of top line, in terms of margin, in terms of our grocery and retail business that accelerated this quarter versus last quarter. And then you are seeing some consolidation in the sector, in the food delivery sector. We were early to the game in terms of growing internationally organically.
18m 11s
We're seeing some consolidation happening, inorganic consolidation happening and that's to be expected in markets that are as large and competitive as ours. So I'd say no change. We can't rest for a second. And because of our global position and because of the unique platform that we have, we think we can, hold our own and then some.
18m 34s
Great.
18m 35s
Thank you. You're welcome. Next question? Your next question comes from the line of Brian Noah with Morgan Stanley. Please go ahead.
18m 45s
Great. Thanks for taking my questions. Have two, one on Austin and one U. S. Mobility. Going back to Austin, Dara, can you sort of walk us through how you're thinking about a size of a fleet or an internal timeline or target when Austin, Waymo combined with Austin human drivers could sort of better be matched supply demand to drive incremental volumes to Uber overall? When do you think that could happen? And then the second one, maybe kind of drilling a little more into U. S. Mobility. Any update on sort of how quickly U. S. Mobility is growing and sort of how the suburbs versus the more urban areas are trending? Thanks. Yes. Brian, in terms of Austin, you know, we're really focused on making sure that the experience every single day is an excellent experience. We're absolutely growing the fleets. It's gonna be over 100 vehicles soon based on the trends that we're seeing. Really, the focus is on keeping the utilization of the vehicles at the high levels that we're seeing. And making sure that, safety and customer experience aren't compromised in in any way. At this point, we're not really a goal and often isn't necessarily for incremental trips one way or the other.
20m 4s
It's just to make sure that every single ride is is the perfect ride. What we see over the long term is if we provide a service that is highly reliable where the every single trip is exceptional prices are reasonable, ETAs are predictable, then over a period of time the business grows, and we are able to gain category position And we see more consumers kind of coming onto our platform. The fact is that less than 20% of adults 18 plus 18 and over use our platform on a regular basis. So we think there's plenty of room for growth. So the focus right now is kind of day to day making sure we get it right and making sure that the streets of Boston are safe.
20m 52s
Yeah. Go ahead.
20m 52s
The second question? Yeah. Brian, it's Krishna. I'll take the I'll take second part. Then it was on, on mobility growth. So maybe we'll let's have let's have set some contacts for the for the last couple quarters. I think three quarters now, we've had about 19% year over year trip growth.
21m 9s
So very strong trip growth. And as we look at what we've incorporated into the guide, we're thinking that it should be around the same. That we're fortunate it's still very heavily led by audience growth. When we look at that conversion from trip growth to GB growth, we are starting to see the gap between trips and gross bookings. Narrow a bit because we've been able to pass along lower insurance costs, primarily here in The US. We you might remember we indicated that in the latter part of, of the year, that, that we would expect better insurance costs in this year, and that's exactly how it's turning out. The other item that, that, Dara made mention of earlier one of his answers is we are seeing a slightly higher mix of international trips and that's a bit due to that lower inbound US travel, which, which comes with lower gross bookings per trip. But despite sort of the this mix shift, you'll notice we were able to print all time high margins, for the the quarter. So we're able to really continue to pass those insurance costs through no economic impact of that, to our shareholders, and we're able to put the margins, and continue to show that sort of margin accretion story.
22m 29s
And then lastly, I think you asked a bit about growth in the suburbs versus the urban. A metric that we're we're now able to share is that sparser markets, which are growing, at a faster rate than our core, are represent about 20% on a trip basis. For for mobility. So we're continuing to see great growth in those partial markets because it's growing faster, but it's also a sizable percentage of the overall mobility volume.
23m
Great. Thank you both. Next question, operator.
23m 4s
Your next question comes from the line of Ross Sandler with Barclays. Please go ahead.
23m 11s
Great. Just question on the delivery margin and a call out you guys made in the prepared remarks. So you said that restaurant delivery has profit margins that are modestly lower than UberX profit margins.
23m 27s
So that's an interesting nugget in itself.
23m 32s
I guess the question is, looking at that, what does that say about the cadence of margin expansion at grocery and retail? I think you also said that part is at a 2018 kind of equivalent maturity. And then how much of the restaurant margin know, being way up there is because of advertising just because of time and market and know, the usual kind of retention cadence, etcetera.
24m 4s
Any thoughts on that? Sure. Thank you, Ross. It's Prashanth. I'll go ahead and take that. So delivery has been a pretty incredible profit story for us. If you if you look at, the results for the quarter, delivery margins are at 3.7% of GBs, That's up 70 bps, versus, where it was just a year ago very strong expansion. Now that margin is primarily being driven by advertising and the leverage we're getting just from the scale, the OpEx leverage that we get from scale. And that's been a fairly consistent driver of what's been, behind the margin expansion over the last couple quarters. The the item that I'd probably, highlight there is that the the, our cost per trip, continues to show great improvement. That's the benefit of the scale we have declining. It's declined both quarter over quarter. And year over year. The delivery profitability numbers, that includes our grocery and retail, which which you made reference to. Remember that we said in q four of last year, grocery and retail, hit break even for variable contribution. And in q one, it's now starting to accrete. At variable contribution levels. So that deli that grocery and retail business has has great upside, and it's gonna continue to grow both as a result of advertising, but also as we continue to improve selection.
25m 32s
I will call out one item that may not be, notable to everyone is incremental margin for delivery in Q1 were 9%.
25m 40s
So this with that very strong top line growth, it's a reflection of what just the earnings power of this business can be. With continuing to to see that that opportunity to drive margin expansion. Having said that, as we've said consistently in in our calls, we need to always find a balance between growing profitability growing the top line. So, I don't want to overcommit to a the growth in delivery profitability. We're looking for steady margin expansion, so we can continue to invest in growing the top line of the business given that we have so many opportunities to invest in.
26m 22s
Next question, please.
26m 25s
Your next question comes from the of Mark Mahaney with Evercore. Please go ahead.
26m 31s
Okay, thanks. I'll try to First, just on the insurance headwinds, do you feel like that's mostly behind you now? Just talk about where you think ongoing leverage against insurance costs are? And is that something that's kind of structural to the industry? Or are those things kind of workarounds or improvements that you've been able to do? And then Dara, in terms of AV partners and you've got a pretty good view on all the different offerings that are out there. Waymo is doing a fantastic job. Who do you think is coming who do you think in the marketplace is closest to Waymo now in terms of having the ability to roll out at a decent scale a true AV experience? Thanks.
27m 13s
So why don't you take the the Waymo one first? And then I'll close with insurance. Yeah.
27m 18s
Sure. Mark, it's it's hard to tell exactly who has what capability because AV is, is, still very, very early in terms of his development. Tell you that listen. In in China, you have AV product that has is in market today. For WeRide, who's a partner in Abu Dhabi and and Dubai and expanding in 15 countries. Pony, whom we expect to introduce to The Middle East sometime in Baidu as well, These they have essentially AVs running in Chinese cities right now. Very challenging traffic conditions and conditions generally. And then there are a lot of other players that are showing incredible promise as well. You know, we, announced a partnership with Main Mobility. We've [indiscernible] with Momenta as well where we expect to see an AV development deployment in Europe as well. [indiscernible] this is this is a technology that has been proven. Waymo was definitely the leader there. But there are many other players, investing in the space. And we expect to see, you know, a number of successful companies in the space hopefully partnering with us.
28m 37s
Yeah. So, Mark, on the on the, insurance question, I remember in, in q four of last year, we indicated that, that for 2025, we thought insurance, increases would moderate and more likely be in the high single, perhaps low teens area. And, and we, we actually overestimated it. CPI print for March was coming in at 7% year over year, and that's the lowest we've seen in almost three years. So as we think about our US mobility insurance cost expectation for the balance of the year, we're thinking that it will continue to be a very modest headwind of, of high single digits. Through 02/2025, and that is meaningfully lower than we've seen in the last two years. And certainly, given the rate of growth for The US mobility business, that's going to create some leverage for us. But as I said in my, prior response, we intend to pass those those opportunities to consumers. Now where we are getting, some incremental, strength from the from the great efforts of our team are in in a few areas. First, on safety tech, some great innovation that we're driving in this space, giving our drivers insight into how their driving behavior, is is being scored.
29m 57s
And that is now live in all US markets, and drivers are responding very favorably to being able to understand their their, like speeding, harsh braking, acceleration, etcetera. So that's, that's one element that we've now deployed across The US. On the policy side, which has also been an area that we've been talking about for a while, we're getting some great momentum there. For example, in in just in this first quarter, a tort reform bill is in Georgia awaiting the governor's signature. And if if we get through that, that's gonna be a meaningful step to combat some of the legal system abuse. And is going to help us continue to drive down insurance costs over time. And we have other bills, in other states like Nevada and Texas and continue to have some good discussions in other areas. So overall, I think that, that the energy that we're spending on insurance, both because we have a captive that allows us to create tension on pricing, We have an organization of engineers that's really working on finding new technologies, and the efforts that we're doing on the policy side are gonna continue to make this a, a more favorable situation for us than has been over the past couple of years.
31m 10s
And, Mark, I I just stress on the on the policy angle that you know, US drivers are not, less safe than drivers internationally. The cost of insurance that has to be paid on to consumers outside of The US is de minimis compared to The US. So this is just it's it's a huge part of the inflation that consumers are experiencing. We're hoping that local policymakers and and the administration and place know, want to fight inflation as much as we do because really this inflation is caused by abuse of the legal system. It's entirely unnecessary and we're hoping that policymakers can work with us to bring prices down for consumers. And more of of the fares going into the driver's pocket. That that we really think is a win win. Okay. Thank you very much.
32m 1s
You're welcome.
32m 3s
Your next question comes from the line of Justin Post with Bank of America. Please go ahead.
32m 9s
Great. Thanks. Just like a question on the macro. You mentioned maybe slower airport trips, but any impact on mobility rides or price pricing or delivery lower AOVs or anything like that on the macro or contemplated going forward? And then can you give us an update on competition in Bay Area and San Francisco I'm sorry, Bay Area and LA? I know those are areas where Waymo's operating. Just any update on the competition there? Thank you.
32m 39s
Yes, absolutely. So in terms of macro, Justin, we're watching it pretty close We don't see any signals that I describe as significant. Audience growth is very consistent with last quarter up 14%. Frequency is is consistent as well. We are looking to modulate price increases you saw that in our results as well. But we're not seeing, like, you know, basket sizes continue to increase. I think that would be a leading indicator to the extent that there was macro uncertainty We're not seeing trade downs in terms of the kinds of restaurants that our eaters are eating at. It's it's absolutely something that we're watching. But we don't see any signal as of yet in terms of the consumer. And remember, the categories that we operate in you know, these are restaurants, transportation, grocery, tend to be categories that are quite consistent even during periods of macro uncertainty. So I think from a relative standpoint, we're, you know, a little bit less subject to these issues, but right now, we don't see any signal whatsoever, and hopefully, it'll remain the same. And you kind of see that in the guidance which is pretty consistent in terms of top line with this quarter.
33m 53s
In terms of San Francisco and LA, the competitive environment, pretty stable, Justin. We're not seeing any change there. Are very supportive of mayor Lurie's plans to kinda get San Francisco going again. And we think that'll benefit all of the competitors in that marketplace.
34m 10s
Great. Thank you.
34m 12s
You're welcome. Next question?
34m 15s
Your next question comes from the line of Ken Gorelski with Wells Fargo. Please go ahead.
34m 21s
Thank you. Two if I may please. First maybe one for Prashant.
34m 26s
Given the affordability initiatives and the commentary on insurance, but also your kind of preview of the Go Get event later this month. Could you talk about the impact potentially on mobility margins in the second half of this year and beyond? And then one for Dara, please. If you could talk expand a little bit more about your your view of the AV landscape, kind of both in inside The US and outside The US, when do you see software enabled AV solutions as a as a scale commercial option? Thank you.
35m 1s
Yeah, Ken. So, let me I I'm reluctant to guide, for the second half. But I can say this, that, that we are committed to continually showing steady margin improvement on a year over year basis. But as we've said many times, we're gonna we're gonna manage the p and l across both lines of businesses and striking that really tough balance of investing for growth when we have so many opportunities to invest in. While continuing to to drive the, the profitability of the company. We we shared some pretty strong, profit expansion in the mobility, business this quarter on a sequential basis and on a year over year basis. I would not, take that as an indicator for how you wanna model the balance of year. I think that, steady margin expansion throughout the throughout the the cycle of this company on a year over year basis is how you wanna how you wanna model us out.
36m
Yeah. In in terms of a d, we're seeing a ton of innovation in in the marketplace that we're actually quite excited about. And and generally, you see you know, we're early. I would say AV tech was based on heuristics, a bunch of if thens, based on different scenarios that were being built. And we're seeing players like Waymo and a number of others you know, move more and more the heuristics logic into large transformer models. To create more flexibility, better scalability, better cost, etcetera. And those kinds of models also have the benefit of not having to be overfixed. To a particular compute or hardware or sensor stacks as well. They're generalizable in terms of where they drive, and they're more generalizable in terms of the hardware kit that's necessary, the sensor kit, etcetera. So that is all moving, in the right direction as far as separating the software stack from the hardware stack. I think a lot of you probably saw the announcement of Waymo partnering up with with Toyota. That's just indicative we think of where AV is going, which is you've got, pure play software developers, increasingly offering more sophisticated AV platforms to the OEMs around the world and a world in which, you know, ten years from now where every single new car sold, comes with level four, level five AV, we think is a terrific outcome in terms of safety for the streets.
37m 34s
Also our platform, which will allow you know, any player, any owner of those vehicles, whether it's financial institutions, etcetera, to monetize those vehicles at the highest utilization so that they've got the lowest cost of capital. So the direction that we're seeing is absolutely, it's very encouraging. There are some players out there that are are pure call it next generation large models end to end models as well. You know, these are the waves or the lobbies of the world and in trucking or Mementa as well. And that is a more pure AI kind of direction. Which has been incredibly promising in terms of the pace of development and, again, the generalizability of the software both in terms of where it's driving and the hardware kits as well. So the innovation that we see is is pretty incredible. We are obviously working with many of these partners around the world. I think we've got a excellent point of view as to who the leaders are, and you're seeing us partner with many of the leaders in the industry. So hopefully more to come and you know we've announced I think five partnerships in the past week It is coming fast and furious and and the the innovation and the development there is pretty exciting for us.
38m 53s
Thank you both.
38m 54s
You're welcome.
38m 58s
Your next question comes from the line of Shweta Khajuria with Wolfe Research. Please go ahead. Thanks a lot for taking my questions. Have two on delivery please. Dara, could you please talk about your affordability efforts in your letter you talked to, you know, four key areas and affordability is what was one of them. So you could please expand on that, that'd be great. And then the second is just in Europe in particular, we have seen now you have a majority stake you just announced and then DoorDash announced deliveries. Could you please talk to that market? How fast is it growing? What does the competitive landscape look like there? And how do you view consolidation? Thanks a lot.
39m 39s
Yeah. Absolutely. So in terms of delivery, we we are very focused on affordability as it relates to delivery as well. And the two efforts that I would point out, you know, one is membership. So membership essentially is our lowering prices no delivery fee for example, four members and and for the most loyal customers that that we've got. Members tend to have high retention. They spend three times more than, than nonmembers as well. And our membership program now with 30,000,000 members is delivering billions of discounts, so to speak, for for those members. And our penetration of membership continues to increase on delivery It's over 60% now. And in certain markets, it's at the 70 plus percent, mark as well. So think, you know, more members, getting better deals, getting more discounts is is a good thing and and and that's part of our business that continues to grow. The second area of focus that I point out are what we call merchant funded offers. These are essentially offers that merchants can put into the system I just enjoyed one a couple of nights ago. It's kind buy one, get one free or other kinds of discounts.
41m
Merchants like those discounts because, you know, their cost of food isn't necessarily they they get to kinda use the cost of food as as the discount and and and they can enjoy a margin on their on their food. And we're seeing higher and higher percentages of merchant funded offers in the marketplace Merchants who who put these offers into the marketplace increase their visibility in the marketplace and are able to increase their sales in the marketplace as well. We're seeing growth in both and we think that is partially responsible for the consistently high gross booking growth that we're seeing in delivery both in The US and internationally as well. And then to your question in terms of competition, especially Europe, We're really, really happy about our results in Europe. We recently, we believe, got to the number one category position in The UK, with Eats. Entirely organically. We didn't have to buy our way into Glory, so to speak. France remains a top market, for us. And we think that Germany, for example, is a market that holds significant amount of promise I think we launched in Germany three to four years ago and our category of business position continues to increase in Germany.
42m 18s
As we invest in that market both on the mobility and delivery side. So we're seeing very we're seeing very encouraging trends in Europe and frankly, it's not a surprise to see some of our competitors look to expand there inorganically. We like organic expansion more. We've been investing for years in these marketplaces I think it shows in our results.
42m 42s
Thank you, Dara. Was helpful. You're welcome.
42m 44s
Next question?
42m 48s
Next question comes from the line of Michael Morton with S. MoffettNathanson. Please go ahead.
42m 56s
Good morning, everybody. Thank you for the question. One on delivery and then one on mobility. For delivery, as we see the continued adoption of these large language models, introducing shopping experiences they seem to be preferring different retailers. Than, let's just say, the two giants in which we're all aware of.
43m 17s
And it seems like a natural opportunity for Uber to work in partnership with these retailers you already work with. To deliver the local inventory. So, Dara, I was curious any possibility partnerships with the ChatDPTs of the world And then I think one for Prasanth on the sparse market Could you talk about the duration of this opportunity? And the ability to continue offsetting some of the natural deceleration you've seen in some of your urban markets?
43m 47s
And then maybe help investors think about the margin profile of the Sparse mobility markets compared to your core kind of urban markets? Thank you so much. Yeah. I think on delivery and large language models, you know, we're we're very, very early in terms of the development of these of the models and their application to consumer experiences or enterprise technology, And I wouldn't say that right now, our focus is to kinda push volume from one merchant to the other. It's really to focus on improving the customer experience. And and, you know, it's starts in smaller ways. So for example, we're using larger models in terms of our restaurant grocery search so that we understand more about the context of the consumer. We get to know the consumer more. And we're able to, to surface better results, higher quality results in terms of search, in terms of the sort order of restaurants that we're offering you or the promotions that that that we're offering you as well. And then we absolutely are working with OpenAI's of the world and the other leading LLMs and LLM companies in terms of some of the agents that are being built and being able to offer kind of a Uber experience that seamless and delightful that you can talk to as well.
45m 12s
I stress that it's very, very early in experimentation phase. And, you know, we're gonna be working with them to to what the possibilities are. We have unique access to transportation inventory, We are global obviously have human drivers. We have AV drivers. We have food available, grocery available. So I think we're kind of the partner of choice for many of these players. But right now, the focus is how do you build consumer experiences that are delightful, How do you make every single service of ours a little bit more optimized? For consumers. Then, you know, we'll deal with the after effects later in terms of merchant concentration It's just not something we're focused on right now. Operation, if you wanna take the other one?
45m 58s
I will. I'll take the second one. Thanks for the question, Michael. Maybe I could start with just a gentle correction to a comment you made about deceleration. It may surprise folks to know that the vast majority of our top 20 cities are still continuing to grow at double digit rate. So we we are still very, still seeing very strong growth. In our in our core areas. But what we do see is we see the opportunity to, to increase the length of time that that core business can grow at attractive rates by investing into these sparse markets. And we're already seeing great indications, for example, in mobility. I think I'd already mentioned that 20% of our trips are now, coming from, sparser markets and those are growing even faster than, than the urban core. Having said all that, I think, the the way to maybe to capture all this is once these markets hit sort of the the the full investment profile and they're running they're running well, Margins are very much in line with what we see in our other markets. And the rate at which we're investing is where we're we're launching hundreds of new cities in 02/2025.
47m 6s
So there's plenty of room for us to run here. Obviously, there's an investment period before before they before they achieve those, those more, continuity level margin profiles. But that's all part of growth opportunities that we see in front of us.
47m 22s
Great. Operator, we'll take the last question, please.
47m 27s
And your last question comes from the line of Nikhil Divani with Bernstein. Please go ahead. Hi, thanks for taking my questions. I have two on Mobility please. First, how should we think about the slope of deceleration mobility gross bookings over the next year? Q1 stepped down by several points and maybe that's just pricing and mix given the trip growth comments, but how do we get comfortable with mobility bookings not decelerating more aggressively here? In the quarters to come. And then separately a follow-up on the less dense markets.
48m 3s
You think the frequency opportunity in these markets is the same as your larger cities? I would imagine there's far more car ownership and some reliability differences. So how do you think about the opportunity set on a frequency basis relative to your core urban centers? Thank you.
48m 20s
Thanks, Nikhil. I'll start and then hand off to Dara. I think the you go back to the to the algorithm, it is bookings equals trips times our, our average, our average price. And if you look at the strong growth that we've been putting up over the last several quarters, those have all been built on top of a 19% year over year trip growth for the last three quarters. And our our indication is that q two is going to be in similar vein. The, the contributor to that, to those trip growth continues to be heavily led by audience growth. And, so that that narrowing of of the delta between trips and gross bookings is coming from, as I mentioned, a little bit of mix, because we saw higher international mix and the the favorable, versus expected, delta on insurance costs. So, we would we would sort of, I guess, softly let you, think about balance of year gross bookings should you shouldn't be looking for a deceleration. You should be looking for that trip growth continue to be led heavily by, by, audience growth and and then we'll we'll have to see what where the pricing opportunities continue to be provided by insurance.
49m 49s
And Mikael, I just add in terms of mobility trip growth as well is that the base trip growth, the core trip growth is supercharged by the growth in less dense areas as well and some of the growth bets that we've had. You know, in terms of lower cost products Two wheelers and three wheelers are growing incredibly quickly. Our taxi business continues to grow. You know, we have the we're not even close to the majority of taxis in the world. And as we add more taxi supply, trip growth continues to grow and kind of extends the runway of our growth there. And then, of course, shared, you know, Rod both in terms of high capacity vehicles that bring the price envelope down.
50m 36s
And or x share our products that essentially allow you know, single driver to serve multiple riders as well. So we got a business that continues to have a lot of growth runway We're expanding into new markets, both geographic but into less dense markets. And there's a whole portfolio of newer products that continue to grow, faster than the core, so to speak, that have substantial runways, ahead of them. In terms of frequency, in the less dense areas, our less dense initiative really started with delivery. And what we're seeing is that in those markets, you know, you actually typically have families ordering, etcetera. And the frequency that we see in delivery continues to grow in both dense markets and less dense markets, So it's unclear as to whether expansion into less dense markets would hurt frequency on the delivery side. It's certainly frequency continues to increase in delivery. So we're very happy, as it as it relates to those results. On mobility, do think that you're right. People will have car ownership will be higher in suburbs, etcetera. So I would expect frequency and mobility as we expand into these lower devs, less devs areas to to be a headwind, I do think that price will be a tailwind especially as it relates to reserve.
52m 8s
In some of these markets people kind of you know, use reserve in order to drive reliability in the suburbs. About 40% of reserve trips are now not related to travel as well. So it's becoming kind of a everyday habit going out to dinner. And I do think that's a concentration of reserve in these less dense markets is going to be higher than in urban markets as people are willing to pay a premium for higher reliability in these less dense markets. So I do think frequency will be lower, but I think pricing and margins as it relates to product mix will be higher.
52m 46s
Thank you both.
52m 48s
All right. I think that's it operator for the call. Thank you everyone for joining us this quarter and a huge thank you to the Uber team as well as our partners None of this will be possible without the hard work of your team of the team. Thank you to the team and, we'll see you next quarter. And hopefully, this will be the start of a strong year for the company.
53m 11s
This concludes today's conference call. Thank you for joining. You may now disconnect.
Key Insights
Uber reported strong Q1 2025 results, with 14% growth in monthly active consumers (170M), 18% increase in trips, record EBITDA of $1.9B (up 35% YoY), and free cash flow of $2.3B.
Gross bookings grew in line with trips, driven by engagement and frequency rather than price increases; retention rates hit all-time highs globally.
Delivery margins reached 3.7% of gross bookings (up 70bps YoY), with advertising and operational scale as key drivers; grocery and retail delivery achieved positive variable contribution and are expected to continue margin accretion.
Insurance cost headwinds in US mobility have moderated, with expectations for high single-digit increases through Q2 2025, aided by safety tech and policy reforms; Uber plans to pass these savings to consumers.
Uber is expanding its autonomous vehicle (AV) partnerships (e.g., Waymo in Austin, five new AV partners globally) and continues to invest in less dense markets and new products, supporting ongoing trip growth and margin expansion. Forward guidance suggests continued strong top-line and profitability growth into the seasonally stronger second half of the year.
