Uber

Moat components and durability. Network effects (score 90; weight 40%): Uber’s two‑sided marketplace benefits from density at the city level: shorter ETAs, more liquidity for riders, and higher utilization for drivers. Trip growth of 22% YoY in Q3 2025 and MAPCs growth of 17% indicate strengthening engagement.

Multi‑homing moderates this moat but scale leadership in many markets and cross‑product usage (Mobility, Delivery, Membership) reinforce it. Risk: robotaxi suppliers or OEM fleets could try to disintermediate. Uber’s aggregator approach with 20 autonomy partners and exclusive integrations in select cities helps maintain platform relevance.

Switching costs (score 65; weight 20%): For riders and merchants, switching is low, but Uber One membership and in‑app wallets/benefits raise switching frictions; for merchants, Ads and demand capture create increasing reliance. For drivers/couriers, multi‑homing persists, yet superior demand density and product mix help retention.

Cost advantages (score 75; weight 15%): At scale, Uber spreads fixed platform, payments and safety/compliance costs over massive Gross Bookings, driving rising segment EBITDA (Mobility + Delivery adjusted EBITDA up 21% and 47% YoY respectively in Q3 2025).

Insurance expense is a structural headwind but increasingly managed through pricing and risk analytics. Intangibles/brand (score 70; weight 15%): Global brand, trust, and regulatory know‑how across >70 countries are not easily replicated. Ads and membership enhance consumer mindshare.

Efficient scale (score 80; weight 10%): Urban mobility networks tend toward a few scaled platforms due to liquidity needs and compliance/regulatory overhead; Uber’s global footprint and multi‑modal offering strengthen efficient scale dynamics.

Overall moat: weighted average ≈ 84, with key erosion risks from regulation (EU employment presumption) and autonomy disintermediation mitigated by partnerships. (consilium.europa.eu).

Evidence: Mobility revenue rose 20% YoY in Q3 2025 to 7.7B on 21% Gross Bookings growth; Delivery revenue rose 29% to 4.5B, aided by a 146M YoY increase in advertising revenue. Take‑rates and dynamic pricing have improved margins without collapsing demand.

That said, rider and driver communities report sensitivity to surge and algorithmic changes, indicating pricing power is not unconstrained. Ads provides latent pricing power as inventory expands and CPCs/CPMs rise over time with better targeting; membership discounts can be tuned to optimize contribution margin by cohort.

Risks: regulatory caps, competitive responses (especially in Delivery), and insurance inflation. Net: demonstrated ability to nudge take‑rates and monetize surfaces, with upside from Ads and cross‑sell, but bounded by customer elasticity and public scrutiny.

Drivers of predictability: large, recurring day‑to‑day use cases, rising Uber One membership cohort with 35% higher retention and 3x spend across services, and a growing Ads layer that is less cyclical than ride volume. Q3 2025 delivered 20% revenue growth and record Adjusted EBITDA margin on Gross Bookings at 4.5%.

FCF is compounding with TTM near 8.7B. Offsets: macro sensitivity of discretionary mobility, currency effects, and Delivery competition. Autonomy could be disruptive but Uber’s partner model should smooth timing and capex. Regulation is the main wild card in the EU over the next 2 years as countries implement the directive.

Overall, the revenue and cash flow trajectory has become meaningfully more reliable than in prior years.

Balance sheet and cash generation: Unrestricted cash, cash equivalents and short‑term investments were 9.1B at Q3 2025; total debt 11.8B with planned redemption of 1.15B converts in Q4 2025. TTM free cash flow is about 8.7B, implying net leverage comfortably below 0.5x FCF.

Liquidity and access to debt markets are strong after multiple refinancings in 2024–2025. Risks: legal/tax reserves including a 479M charge in Q3 2025 and UK VAT assessments of roughly 1.8B (paid to proceed with appeal and recorded as receivable), plus ongoing insurance reserve needs.

These are manageable against cash generation, but they can add volatility to quarterly results and working capital.

Uber’s capital allocation has pivoted to shareholder returns alongside organic investment. The board authorized a 7B buyback in Feb 2024, executed a 1.5B ASR in Jan 2025, and added a new 20B authorization in Aug 2025. Management has also refinanced debt, redeemed higher‑coupon notes, and plans to settle 2025 converts.

SBC remains elevated (about 1.8B in 2024; 1.375B in 9M 2025), but is increasingly offset by buybacks. Capex is modest relative to cash flow due to an asset‑light marketplace model; autonomy participation is partner‑driven to avoid large balance‑sheet commitments.

M&A has been selective in recent periods, with focus on ecosystem and international options. Overall, decisions reflect discipline, though we will continue to watch SBC dilution versus repurchase cadence.

CEO Dara Khosrowshahi has executed a multi‑year turnaround from cash burn to sustainably positive GAAP operating income and robust FCF, while elevating governance and regulatory engagement. CFO Prashanth Mahendra‑Rajah (joined Nov 2023) has emphasized free cash flow, balance sheet optimization, and returns of capital.

The reinstatement of an experienced COO (Andrew Macdonald) in 2025 clarifies operational accountability across Mobility, Delivery, and autonomy initiatives. Incentives appear aligned with long‑term value creation, though SBC quantum remains material. Overall stewardship quality is high and trending stronger.