Uber Technologies, Inc. — 2024 Q1

Prashanth, you want to talk to the second question first...

Yes, why don't I -- let me get that one out of the way, Justin, and thank you for the question. So just a recap for how we'd like folks to think about our gross bookings. Remember, the growth algorithm is audience, which is a measure of how many users of the product; frequency, how often are they using the product; and then, of course, pricing. Dara just mentioned that for the first quarter, we had very strong audience growth, up 15%. Great growth in frequency as well, up 6%. And pricing relatively flattish.

Justin, in terms of AVs and our strategy, it really remains the same. First thing I would say is that we think that the AV technology at maturity is going to be very good for the industry. It will be great for Uber. It holds a promise of safer rides. It holds a promise of expanding the marketplace by lowering prices and making mobility, delivery available for a wider swath of the population. And usually, when we see kind of lower prices for any service, you see higher adoption for a service, and that really is the promise of AV.

Thanks, Brian. Let me start then. So maybe as a reminder, when we think about investments on a quarterly basis across the market, we think about investments as what do we need to do to encourage drivers and couriers to come on to the platform, what can we do to be helpful to bring merchants to the platform. And then lastly, what can we do to encourage consumers. So we rotate among those 3 on a quarterly basis based on what we are trying to drive in the different markets in which we operate.

Yes. And I think in terms of Latin America and the competitive environment there, first thing I'd say, I'm assuming you're asking about Mobility, we're seeing very healthy Mobility volume growth in Latin America, in mid-20s. So we like the market, and we certainly like the volumes that we're seeing there. I would say that while -- I think you're referring to DiDi, they signaled a bit more capital discipline, we're not seeing that as of yet. We see DiDi being highly competitive in the marketplace and spending into the marketplace quite aggressively. Listen, it could be temporary. It might be driven by their desire to show international growth as the China markets have slowed down a bit as the prep for the IPO, but it's difficult for us to speculate on that.

Brian, just to shout out for the note last week, I thought that was nice. And we're very much aligned with the more public participants in this market, the better it is for everyone.

Yes. Let me take the first part of that. So again, the Mobility gross bookings growth for the first quarter was -- on a constant currency basis was 26%. Included in that 26% is about 1 point, whether you look at it sequentially or on a year-over-year basis, that came from us deconsolidating the non-ridesharing portion of our Careem business in December. Remember that used to be included in Mobility's results. And when we split that out, you have it in the compares, but you don't have it in Q1. So that's roughly about 1 point.

Yes. And Doug, in terms of our suburban strategy for Eats, it's very similar to our general strategy for our Delivery business on a global basis. We're very happy about our growth rates here, 17% constant currency growth rates for the second quarter in a row. Our U.S. growth rates are higher than that -- our U.S. and Canada growth rates are actually higher than that, which we're quite happy about. And generally, we are growing faster in the suburbs than we are in urban destinations, where we have higher penetration.

Before Dara jumps into that, I just want to remind everyone on what the -- is being referred to. We announced in the prepared remarks that our Uber One membership fees are now in excess of $1 billion. So that's a -- that's the first time we've called that out, but it's a big waypoint for us on our way to continue driving that.

Yes, Eric, in terms of our strategy for Uber One internationally, it's largely the same as our strategy domestically and globally. It's a global product. We see penetration of Uber One consistently increasing in the U.S., Canada and internationally. Members are now generating 32% of Mobility and Delivery gross bookings, which are nicely up year-over-year. It's over 45% in Delivery gross bookings, where generally kind of were -- more highly penetrated. And I'll remind folks that members spend 3.4x as much as nonmembers per month. So it is a great vehicle for us to drive adoption and drive really attachment with our various services as well.

Yes. See, in terms of U.S. Mobility growth, we don't disclose U.S. versus non-U.S. But obviously, by the overall numbers that you see in terms of our Mobility growth, 26% on a year-on-year basis compared to 28% last quarter and 100 basis points of kind of slowdown was because of Careem on a comparable basis. These are very, very high growth rates, and the U.S. is our largest market in terms of gross bookings. So we wouldn't be able to grow at these rates, so to speak, without the U.S. growth being very, very healthy.

Ross, it's Prashanth. Let me start just with a couple of data points and then hand off to Dara. First, as a reminder to everyone, we hit a $900 million run rate for advertising in Q4 of 2023. We do not break that down between Delivery and Mobility.

Yes. In terms of the non-restaurant advertising, listen, it's still really in nascent stages. So we talked about restaurant advertising getting to 2% of gross bookings. We actually think that our sponsored items, product, for example, grocery, can get the higher percentages of that. Instacart, for example, we think, is in the mid-2s in terms of advertising as a percentage of gross bookings. And we fully launched out our sponsored items in the U.S. and Canada, and now we're scaling it in 8 additional priority markets in 2024.

Yes, Mark. So in terms of delivery growth and audience growth, this has been pretty consistent, right? We've accelerated the growth rate of our Delivery business. It was growing closer to 10% early last year. It's now growing in the teens. And we think the nature of that growth is improving as well, which is most of the growth last year was on price. Now actually, price is a relatively small portion of the growth, and audience and frequency are the largest portion of the growth in Delivery. And it is about just getting the basics right. It's about having a great service, having a significant selection, or selections. Active merchants is up 12% on a year-on-year basis.

Yes. I'll take the last part of that. So we remain very positive on grocery and retail. The business growth remains quite strong. GBs are up about 40% on a constant currency basis. Once again, 40%, so very strong top line there. And despite that very strong growth, we were still able to expand our Delivery EBITDA margins by about 20% sequentially, and that was partly contributed to by improvement in the profitability of the grocery business. So it is still not where we want it to be. It's still not at a positive EBITDA margin, but it is improving both year-over-year and sequentially, and we feel very good about the path we have to getting to profitability on grocery.

Yes. As far as the EU platform work directive, EU lawmakers essentially voted to maintain a status quo there, with platform worker status continuing to be decided on a country-by-country basis. Member states have until mid-2026 to implement that. And we think that the deal is really unlikely to bring major changes to the current situation in the vast majority of EU countries. And for us, our view remains the same, which is we believe that we should bring kind of the flexibility that gig works brings to couriers, to drivers in the marketplace, along with certain protections that we kind of talk to and have discussions with on a local basis. So we really don't see any changes coming in terms of the EU.

Okay. Before Dara wraps it up, I wanted to remind everyone next week is our annual Uber GO-GET. This is our event which showcases new products and features across both the Mobility and Delivery. Obviously, we're not going to get ahead of the announcements, but our theme is togetherness. And in addition to the product piece, we've got a great fireside chat with Dara and Maria Shriver. This will be in New York. So if any of you are looking to get out of the office, please reach out to Deepa and we can see what space we have.

I like it. My CFO is upselling. And thank you, everyone, for joining us on the call, and a huge thank you for the Uber teams. There's a ton of work that goes into all of the new products that we're launching, into the products that we'll be talking about in GO-GET, and into delivering the kind of growth and profitability that we've seen from Uber over the past couple of years. So a big thank you for the team for continuing to deliver this quarter.

Thanks, everyone. Talk to you next quarter.