Uber beats on revenue, CEO tells CNBC the company is 'investing significantly' to add drivers

Uber's third-quarter revenue reached $14.77 billion, slightly above analysts' $14.69 billion estimate. However, earnings per share were only 25 cents, far below the expected 96 cents. Revenue rose 10% from $13.47 billion a year earlier, but net income fell to $512 million from a prior-year result boosted by a $4.9 billion tax valuation release.

The main operating businesses did not all meet forecasts. Mobility revenue fell 2% to $7.52 billion, below the $7.71 billion estimate. Delivery revenue grew 23% to $5.49 billion, narrowly missing the $5.51 billion estimate. Total bookings were almost exactly on target at $59.82 billion.

Freight supplied the important upside. Its sales jumped 34% to $1.76 billion, beating the $1.49 billion estimate and lifting companywide revenue above expectations. Investors appeared encouraged, with Uber shares rising more than 7% on Wednesday. Uber expects fourth-quarter bookings of about $64.5 billion.

Uber's three major business areas sent different signals. Mobility, which includes ride-hailing, produced $7.52 billion in revenue, down 2% and below the $7.71 billion estimate. Delivery revenue rose 23% to $5.49 billion, but still trailed the $5.51 billion forecast. These misses showed pressure in Uber's most visible consumer services.

Freight was the standout performer. Revenue from the division climbed 34% to $1.76 billion, far above StreetAccount's $1.49 billion estimate. That outperformance supplied the main reason Uber's total revenue beat expectations, even though mobility and delivery fell short. Total bookings of $59.82 billion were essentially in line with the $59.83 billion estimate.

The mix matters because companywide revenue does not move identically with bookings in every business. Freight's unusually strong sales helped lift reported revenue to $14.77 billion. Meanwhile, fuel costs and limited driver availability hurt mobility supply in several international markets. Uber is responding with targeted driver investments and expects bookings of $64.5 billion at the midpoint next quarter.

Gross bookings measure the total value of transactions placed through Uber's platform. They include the underlying value of rides, food deliveries, and freight services before accounting for amounts paid to drivers, couriers, merchants, carriers, or other parties. Revenue is the portion Uber records as its own business income, so the two figures are related but not identical.

In this quarter, total bookings were $59.82 billion, almost exactly matching the $59.83 billion estimate. Yet revenue reached $14.77 billion, above the $14.69 billion forecast. Freight explains much of the difference. Freight sales jumped 34% to $1.76 billion, beating its $1.49 billion estimate and creating stronger revenue within the overall transaction mix.

This distinction helps explain why bookings can be on target while revenue exceeds expectations. The amount of activity may be as predicted, but business mix and recorded revenue can differ. Uber's strong freight result offset weaker mobility and delivery results. For the fourth quarter, Uber expects bookings of $64.5 billion at the midpoint, near the $64.26 billion estimate.

Fuel prices and driver availability directly affect how many rides Uber can provide. The company said elevated fuel costs and tighter driver supply weighed on growth in several international markets. As a result, mobility performed slightly below expectations, with revenue falling 2% to $7.52 billion. The problem was not a lack of customer demand; Uber said demand exceeded supply.

When fewer drivers are available, riders can wait longer for a vehicle. Limited supply can also push prices higher as the platform tries to balance demand with available rides. Uber CEO Dara Khosrowshahi said the company does not want to raise prices for customers and is also working to avoid longer wait times.

Uber is making targeted investments to strengthen driver supply. Khosrowshahi specifically cited efforts in India, Brazil, and the United States. If those efforts work, more drivers could improve availability and reduce pressure on fares and waiting times. If they do not, persistent shortages could continue limiting mobility growth and customer experience, especially overseas.

Uber is spending in two directions to expand transportation capacity. It is making targeted investments to bring more drivers onto the platform, especially in India, Brazil, and the United States. These efforts respond to a current imbalance: the company says it has more mobility demand than available driver supply.

The company has also committed about $10 billion in capital to bring more driverless vehicles to its platform. It is pursuing this through partnerships and investments involving Rivian, Nuro, AVRide, and other companies developing robotaxis and driverless trucks. Uber expects around 700 automated vehicles on its platform by the end of this year.

Its longer-term target is more than 2,000 automated vehicles by the end of 2027. Half would operate in the United States and half internationally. Uber also plans to add Amazon's Zoox and Motional robotaxis in Las Vegas this quarter. This could broaden supply without relying entirely on human drivers, though the article does not provide a cost or profitability forecast.

Uber is expanding beyond its traditional ride-hailing operation through partnerships, investments, and acquisitions. This approach gives the company access to businesses already developing robotaxis, driverless trucks, delivery services, and merchant relationships. The article names Rivian, Nuro, AVRide, Amazon's Zoox, and Motional among its autonomous-vehicle connections.

The mechanism is straightforward. Uber can place partner vehicles on its platform rather than relying only on its own vehicle development. It is also growing delivery through acquisitions of Delivery Hero in Germany and ezCater in the United States. In Uber Eats, its expanded Costco partnership is already tracking ahead of expectations, with Costco among Uber's top merchants by gross bookings.

The article does not explicitly say that Uber is avoiding all internal development or quantify the savings from these deals. It does show a strategy built around combining Uber's platform with outside capabilities and acquired businesses. That could help Uber add automated vehicles, merchants, and delivery volume faster as it targets over 2,000 automated vehicles by 2027.

A two-sided platform brings together separate groups whose participation creates value for the other side. Uber connects riders with drivers, delivery customers with couriers and merchants, and freight demand with transportation providers. The platform becomes more useful when enough participants join, because customers gain access and providers gain potential business.

Uber makes money from transactions arranged through its platform, while the drivers, couriers, merchants, and carriers receive payment for their roles. The article illustrates the balancing challenge: Uber has more mobility demand than driver supply, yet it does not want to raise prices or create longer waits. It is investing in drivers to improve supply while serving customers.

The same balancing act appears in delivery. Costco has become one of Uber's top merchants by gross bookings, helping expand selection for customers and sales opportunities for the merchant. Freight growth also supports the platform. Uber's future depends on maintaining participation across these groups, including through driver recruitment, partnerships, acquisitions, and automated vehicles.