Uber's Q2 performance exceeded expectations; what are the key investment focuses?

$Uber Technologies(UBER.US)$ Q2 earnings exceeded expectations, but the stock price performance was lackluster. Why is this the case? This issue of [Earnings Highlights] will Share the insights!

Let's start with a quick review of this quarter's performance. First, $Uber Technologies(UBER.US)$ Q2 total revenue was $126.51 billion, and EPS was $0.63, both exceeding expectations. Additionally, the number of trips and total bookings both saw strong growth, increasing by about 18%, indicating steady progress overall.

In addition to the 18% increase in total revenue, adjusted EBITDA grew by as much as 35%, further validating the stability of its profitability. These achievements are attributable to the growth in active users and total bookings on the platform.

Moreover, Uber launched a massive $20 billion share buyback program, sending a positive signal and indicating the company's very optimistic outlook for the future.

Breaking down the Business, Q2 revenue from the Online Car-hailing Business reached $72.88 billion, with an adjusted EBITDA of $19.05 billion. Revenue growth was 19%, which, while better than Q1, still showed a significant slowdown. The Business booking volume was $237.62 billion, growing at only 15.6%, falling short of the expected 16.3%.

As the main revenue driver for Uber, failing to exceed expectations makes it difficult to gain market recognition, and the post-earnings stock price correction is understandable.

On the other hand, the food delivery Business performed much more impressively!

This quarter, the food delivery business generated $4.102 billion in revenue, a 25% increase, significantly outpacing the previous quarter; meanwhile, the total order value reached $21.73 billion, a 20% year-over-year growth, surpassing the online car-hailing business.

The outperformance of the food delivery business is mainly attributed to an increase in bookings and advertising revenue, with the Uber One membership program being a key driver. According to a report by Bank of America Merrill Lynch, Uber One memberships have reached 36 million, a 60% year-over-year surge, and members contribute over 40% of the platform's bookings. As the membership system matures, future profitability is expected to improve further.

The freight business has shown the most lackluster performance and has yet to turn a profit.

This is primarily due to the challenges in the freight market cycle, which have led to lower revenue per order, resulting in a 1% decrease in gross bookings for the freight business. However, given its small size, the impact on Uber's overall performance is limited.

Over the past several quarters, the freight business has shown no significant improvement, essentially remaining flat. Future attention should be paid to its progress toward achieving break-even status.

Currently, Uber's main focus is on its "autonomous driving strategy," which follows a "light assets" + "platform-led" approach, concentrating on building an open and collaborative platform.

At present, $Uber Technologies(UBER.US)$ it has partnered with 20 autonomous driving companies, including both local firms and Nu $Lucid Group(LCID.US)$ ro, along with leading Chinese autonomous driving companies such as Baidu Apollo, Pony.ai, and WeRide. These collaborations cover multiple aspects including vehicle platforms, autonomous driving systems, and operational deployment, showcasing Uber's strategic ambitions.

Uber's biggest competitor in the autonomous driving space is undoubtedly Tesla. Recently, a netizen in Austin, Texas, conducted a test by taking nine rides in Tesla's Robotaxi and compared the prices with Uber. The results showed that almost every trip was cheaper than Uber, with the maximum savings reaching up to 84%, which sounds like a significant threat to Uber's business.

Of course, Uber's CEO Dara Khosrowshahi emphasized that the market for autonomous driving is vast and will not be a winner-takes-all scenario. He also noted that Tesla's current deployment scale is very small and has not yet had a significant impact on market trends.

In this battle for Robotaxis, if Uber can accelerate its market penetration, adjust its Business structure, and secure a larger market share, it could become a key player in the autonomous driving sector. According to information from the recent earnings call, Uber's partnerships are already showing initial success. In Austin, vehicles connected to the Uber platform are running, and based on the average number of orders completed per day, they are busier than 99% of human drivers.

Going forward, we should pay close attention to the effectiveness of these Robotaxi partnerships.

From a technical perspective, referring to the EMA12 and EMA50 Trendlines, the stock price is expected to find potential support at the EMA50 level. Currently, the RSI Indicator is holding above 40, and the 40-50 Range can serve as a potential support zone.

Of course, Uber's stock price reached a historical high in July this year. In recent trading days, the stock price has fallen below the EMA50 moving average, indicating that some investors may be taking profits. Therefore, caution is advised as there is a risk of further retracement in the near term.

Finally, keep an eye on the guidance in the next quarter's Earnings Reports, which are expected to maintain a strong growth momentum. Interested mooers can continue to follow the developments.

Risk Disclosure: This content does not constitute a research report and is for reference only. It should not be used as the basis for any investment decision. The information provided herein is not a comprehensive description of the securities, markets, or developments mentioned. Although the sources of the information are believed to be reliable, the accuracy or completeness of the content is not guaranteed. Additionally, no assurance is given as to the accuracy of any statements, views, or forecasts provided in this document.