UBER is feeling the pressure from bearish momentum. Track the latest developments here.
This transcript is brought to you by Benzinga APIs. For real-time access to our entire catalog, please visithttps://www.benzinga.com/apis/for a consultation.
Operator
Hello and welcome to the Uber third quarter 2025 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 and if you would like to ask a question during this time, please press star1 on your telephone keypad. I would now like to turn the conference over to Balaji Krashnamurthy, Vice President, Strategic Finance, Investor Relations. You may begin.
Balaji Krishnamurthy (Vice President, Strategic Finance, Investor Relations)
Thank you Sara thank you everyone for joining us today and welcome to Uber’s third quarter 2025 earnings presentation. On the call today we have Uber CEO Dara Khosrowshahi and CFO Prashant Mahendra Raja. During today’s call we will present both GAAP and non GAAP financial measures and 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 vary, 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. 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 risks and uncertainties described in our most recent Form 10K 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 to review those documents if you haven’t already. We will open the call to questions following brief opening remarks from Dharam. With that, let me hand it over to dharam.
Dara Khosrowshahi (Chief Executive Officer)
Thanks Balaji. Q3 was an outstanding quarter for Uber, driven by a powerful combination of innovation and execution. Trips grew 22%, marking our fastest growth since 2023. Both lines of business accelerated with mobility trips growing 21%, significantly exceeding our expectations. This top line strength was fueled by record audience and engagement of 17% and 4% respectively. Gross bookings grew 21% while average pricing remained relatively flat. This translated into record adjusted EBITDA and free cash flow, reinforcing our ability to deliver affordability for consumers while generating strong operating leverage. We’re expecting more of the same strong performance in Q4 with another quarter of high teens gross bookings growth and low to mid-30s EBITDA growth in fact, we hit a new record over Halloween weekend, this most recent Halloween, with more than 130 million trips across mobility and delivery and generating more than 2 billion in gross bookings. While we’re proud of what we built, we’re even more focused on what comes next. As I often remind the team, great technology companies deliver today while building for tomorrow. To that end, we decided we’ve defined six strategic areas of focus to guide our next phase. First, from trip experience to lifetime experience, we’re deepening engagement across our platform with cross platform consumers spending three times more and retaining 35% better than single product users. Second is building a hybrid future, seamlessly integrating human drivers and autonomous vehicles into a single marketplace, giving us unmatched flexibility and efficiency. Third, investing in local commerce, expanding rapidly into grocer and retail, now at an approximately 12 billion gross bookings run rate and growing significantly faster than restaurant delivery. Fourth is multiple gigs. This is broadening earning opportunities for 9.4 million drivers and couriers, including new digital tasks powered by Uber AI solutions. Fifth is becoming a growth engine for merchants, helping our over 1.2 million merchant partners drive significant incremental sales through ads, offers and new demand channels like Uber Direct, as well as new partnerships. And then finally, Generative AI embedding intelligence across Uber to enhance productivity, optimize our operations and deliver more personalized consumer experiences. You’ll see us invest in these areas with our product, our people and our capital in the years ahead. They’re designed to deepen customer relationships, grow our technology advantage, and to extend the profitability flywheel that we built with strong execution, a unified global platform and unmatched scale. We’re building the next generation of Uber one that’s positioned to create lasting value for many, many years ahead. With that operator, why don’t we start? Questions?
Operator
Thank you. Your first question comes from the line of Doug Anmus of J.P. morgan. Your line is open.
JP Morgan (Equity Analyst)
Thanks for taking the questions. Dara, Can you just talk about the path. To increase the 20% of NA regions in markets where you have mobility and delivery? They use Uber one and you know, talk about those drivers of cross platform usage. And then could you expand on the recently announced Nvidia partnership? Both of you have invested in several AV tech providers. You’ve also talked about deploying 100,000 vehicles. Can you talk about the timeline and then who will own the fleets in that scenario? Thanks.
Dara Khosrowshahi (Chief Executive Officer)
Sure. Absolutely. So in terms of cross platform and the penetration there, you know, as we talked about about 20, 20% of consumers where we operate both mobility and delivery because we don’t operate mobility delivery in every single country that we operate in, only 20% of consumers are active across both businesses. And for example, 30% of our mobility riders have never tried any Uber eats offering and 75% have never tried grocer retail. And typically where we see a higher penetration of that 20% is in markets where mobility and delivery are particularly strong in terms of their penetration. Australia is an example where the cross-platform penetration is higher. the cross platform crossover is higher. What we have now done, what we’re doing now is to set up specific programs to drive cross platform behavior. So you’ll see kind of top tabs and rides and Uber Eats app to make it easier to transact across the various businesses. We’re creating like personalized experiences to upsell based on context. Let’s say rise to Eats. If you’re going to work, we’ll offer you Starbucks on the way to work. That’s great incremental business for Starbucks and it’s kind of a delightful experience for you as well. And then of course membership is a huge factor in deepening kind of our own relationship with consumers. But then also introducing cross platform as well. So all of those are various ways to drive cross platform. The average cross platform consumer is spending three times more than kind of monoline consumers. So it’s just a mathematical and unique advantage that we have. And I think we’re very, very early in terms of the innings in terms of driving cross platform activity. It’s happening naturally and again, a lot of innovation going on from the teams to make sure that when we target cross platform usage, we’re doing with kind of with the right context and not getting in the way of your just ordering pizza on a Friday night. In terms of Nvidia, we are very, very excited about the partnership there. Nvidia is creating with Hyperion, like a reference architecture for L4 Ready, L4 Ready autonomous that they’re going to make available to any OEM out there. And if you kind of step back and you think about the strategy, a future, you know, 10 years from now where every single new car sold is not only L3 ready if it’s a personal car, but it’s also L4 ready if you want to contribute that car to a ride sharing platform like ours, or fleets might buy those cars as well. That is a very bright future for the world because it’ll make the world safer in terms of these autonomous vehicles being super safe, not getting distracted in terms of driving, but it’s also very good for our ecosystem in that we will have a ready kind of supply of cars on our platform as well. And we are very early, but I think that we’re quite confident in demonstrating that cars, L4 cars that are on our platform can drive higher revenue per car per day than cars that aren’t on our platform. So we think that the Nvidia strategy, and our strategy is very much aligned. We announced the relationship also with Stellantis, with the initial 5,000 vehicles that are going to be powered by Nvidia as well. But we expect that to scale significantly more going forward. We will use our, you know, again, Nvidia is building the software as well, so it’s a hardware platform, but Nvidia is also investing in building out L4 software stack that will be then essentially distributable on any car using the Hyperion 10 platform, which is a great reference architecture. And then in terms of who’s going to own the fleets, you know, we will. We can lean in with our balance sheet early on to kind of establish the economics of these fleets. But eventually we think that you’re going to have just like you’ve got these REITs owning hotels that are yield vehicles. I think that you will see yield vehicles show up for fleets in terms of whether they’re owned by private equity or public fleets out there. So we can lean in with our balance sheet, but we think that all these assets are going to be financialized over a period of time. So very excited about the partnership. Obviously, if there’s one ally you want in the world in terms of AI or autonomous, it’s Nvidia and super excited to innovate with them. Thank you. Dawson.
JP Morgan (Equity Analyst)
Sure.
Operator
The next question comes from Eric Sheridan with Goldman Sachs. Your line is open.
Goldman Sachs (Equity Analyst)
Thanks so much for taking the questions on the delivery side of the business. As you continue to widen out the array of what you’re offering users, can you talk a little bit about how much of that is a stimulant to new user growth for Uber Eats or a driver of increased frequency across the broader platform, just to better understand where the sort of the output of the yield is showing up in the business? And then on the AV side, maybe building on Doug’s question where you’ve rolled out EVs today, what have you learned so far with respect to the impact of more supply on the road and how it helps either stimulate demand or impact on the pricing side?
Prashanth Mahendra-Rajah (Chief Financial Officer)
Thanks so much. Yeah, hi Eric, it’s Prashant. I’ll take the first part of that on Delivery. And then, and then let Dara address the AV side. We had a. We’re really thrilled with how the delivery business has accelerated for the third quarter. It’s the fastest growth we’ve seen in four years. Four points of acceleration. And it really, you’re seeing that growth pretty broad across multiple markets. And it’s coming from investments that we’re making in a number of areas on improving the product. On the grocery and retail side, specifically, we’re very excited on how grocery and retail is leading to an introduction of folks into the online food delivery as well. And we’re seeing great growth. And I think we have some data in our supplemental charts that show some of the statistics around that, which is, which is grocery and retail being a source of creating consumers for the online food delivery. Grocery and retail. It’s a great tam for us. I think in the prepared remarks we may have mentioned that we’re at now a $12 billion run rate and it’s growing at a meaningfully faster rate than our online food delivery. And we’ll continue to lean into that grocery retail business, which is now variable contribution positive. So it is, it’s helping us carry its own weight with high growth and really is working quite complementary with delivery. And then as Dara just answered in Doug’s question, it’s that cross, cross platform strategy that we’re working on to help folks move across all three of our lobs.
Dara Khosrowshahi (Chief Executive Officer)
And then, Eric, in terms of how AVs are affecting the overall business, listen, it’s very, very early. Biggest scale operations that we’ve got are with Waymo in Austin and Atlanta. And what we are seeing is that those markets are growing faster than other US markets. And this is in a Q3 where the US actually accelerated nicely Q3 over Q2. So the overall US market is strong. But we’re finding that, for example, growth in Phoenix, Austin, Atlanta was more than twice the rest of the US So that’s certainly good signal. What that has also led to is that driver earnings in those markets are super, super healthy as well. So in Austin, for example, where we have the most AVs on the ground, driver earnings per hour actually outpace the rest of the U.S. so, you know, whether or not the growth in those markets is correlation or causal, it’s too soon to tell. But the markets certainly look healthy. Our partnership with Waymo continues to be excellent from an operational standpoint. Waymo utilization is still very, very high. And what we’re seeing is an overall market that’s healthy as well, which is really good signal. As we transition to this hybrid network of AVs ...
