Uber Technologies, Inc Q4 FY2024 earnings call

• Growth Acceleration: Gross bookings growth on constant currency basis beat expectations, multi-product use at all-time high of 37% of consumers, Uber One membership added 5 million members to reach 30 million.
• 2024 Performance: Exceeded commitments on gross bookings (21% vs mid to high teens constant currency CAGR), adjusted EBITDA grew 60% year on year vs high thirties to forty percent CAGR, annual free cash flow conversion 106% vs 90 plus percent.
• Q1 Guidance: Expect continued strong growth in Q1 with 17% to 21% constant currency gross bookings growth and profit expansion.
• Autonomous Update: Commercialization of AV technology will take longer, but Uber is an indispensable go-to-market partner, with Austin launch next month.
• Mobility Investments: Continuing to invest in mobility consistent with profitability framework, EBITDA margin 7.8% of gross bookings in Q4, up 30 basis points, benefits from supply incentives and operating cost leverage, partially offset by higher insurance costs.
• Growth in Less Dense Areas: Focus on extending network into less dense areas for both mobility and delivery, seeing higher growth rates there, with initiatives like driving penetration in less dense geos, expanding globally, and using supply incentives and product enhancements.
• AV Business Model: Expect experimentation with business models, early on may take balance sheet risk, addressable market for AV is expected to grow over time, starting at 10-15% of marketplace in next five years.

Mobility: In Q4, constant currency gross bookings growth was 24%. EBITDA margin was 7.8% of gross bookings, up 30 basis points year over year. Uber One membership program added 5 million members in the quarter, bringing total to 30 million, up nearly 60% year on year. Autonomous: Fleets represent about 15% of inventory, but commercialization of AV technology is expected to take significantly longer. Uber is investing aggressively in AV, with Austin launch next month, and is an indispensable go-to-market partner for AV players.

• Q1 constant currency gross bookings growth guided at 17% to 21%.
• Exceeded 2024 commitments on gross bookings, adjusted EBITDA, and free cash flow conversion.
• Continued strong growth expected in Q1 with profit expansion, overcoming headwinds like leap year quarter, weather events, and FX.

• FX Headwinds: Impact on top line, with FX expected to be a larger headwind in Q1.
• Insurance Costs: Higher insurance costs partially offsetting tailwinds from supply incentives and operating cost leverage.
• AV Commercialization Delays: Technical, regulatory, and operational challenges could delay commercialization of AV technology.

Q: On autonomous and core rides business A: Dara and Prashanth discussed AV investments, fleet supply, mobility profitability, and growth in membership and less dense areas.

Q: On supply and growth in less dense areas A: Prashanth talked about extending network into less dense geos, global initiatives, higher growth rates there, and strategies like supply incentives and product enhancements.

Q: On AV market evolution and Q1 guidance A: Dara discussed AV commercialization requiring five factors, Prashanth talked about Q1 guide considering headwinds like leap year, weather, and FX.

Q: On AV experience in Phoenix and insurance costs A: Dara talked about AV utilization and opt-in rates, Prashanth discussed easing insurance pressure and outlook for 2025.

Q: On AV business models and addressable market A; Dara discussed experimentation with business models and addressable market growth for AV.

Q: On EBITDA guide, FX, and pricing A: Prashanth talked about FX impact and management's approach to managing it, Dara discussed pricing balance and ability to meet guidance