I was skeptical of Uber for years. The company burned through billions, the business model seemed permanently broken, and Wall Street treated it like a glorified taxi service that couldn't figure out how to make money.

But something changed in 2023-2024, and the Q4 2025 earnings released yesterday confirmed what I've been tracking for the past 18 months. This company isn't the same money-losing growth story anymore.

Uber trades roughly where it was six months ago, down from its October 2025 high of $100. The stock dropped 8% after earnings because the company missed adjusted EPS estimates by 11% ($0.71 vs. $0.80 expected).

But the company generated $9.8 billion in free cash flow in 2025, that’s up 42% from 2024.

The business is printing cash while still growing gross bookings at 22% annually. Uber is hitting it’s stride and Wall Street still isn’t showing the love it should.

I have 5% allocated to Uber in my growth portfolio, established between $72-85 over the past four months. This isn't my largest position, but it's high conviction based on a few catalysts that most investors are underestimating.

Let me walk through the business breakdown, the investment thesis that has me bullish despite yesterday's sell-off, what the technicals confirm, and the one risk that would change my mind completely.

To understand why Uber's mispriced at $75, you need to forget what you think you know about this company from 2016-2020. The Uber of that era was, indeed, a cash incinerator.

The Uber of 2026 is fundamentally different. The company has developed into a profitable, diversified mobility and logistics platform with three distinct revenue engines and a fourth just starting to emerge.

The Three Core Engines

Engine 1: Mobility (57% of total revenue in Q4 2025)

This is the ride-hailing business everyone associates with Uber. In Q4 2025, Mobility generated $8.2 billion in revenue, up 19% year-over-year. But the interesting part is what's driving the growth underneath.

First, the platform now processes 15 billion trips annually (announced in Q4 earnings). That's up from about 12.4 billion trips just two years ago. More importantly, Uber's monthly active platform consumers (MAPCs) hit 202 million in Q4, up 18% year-over-year.

For context, that's roughly the same as the entire population of Brazil using Uber every month.

Second, trip frequency is accelerating, not decelerating like you'd expect from a mature platform. CEO Dara Khosrowshahi highlighted in the earnings call that Q4 saw "the strongest UberX trip growth in the U.S. in over two years." The core U.S. ride-hailing business, which skeptics assumed was saturated, is actually reaccelerating.

Third - and this is the part that surprised me when I dug into the prepared remarks - international represents 60% of mobility gross bookings. It's a global platform where the majority of rides happen outside America, which creates massive optionality as emerging markets develop. India, Brazil, parts of Southeast Asia, and these markets are still in early innings of adoption.

The margin story in Mobility is equally compelling. Adjusted EBITDA for the segment hit $2.2 billion in Q4, up 25% year-over-year. That's a segment margin of roughly 8% on gross bookings of $27.4 billion. Not spectacular, but improving steadily.

More importantly, the company's introduction of premium services like Uber Reserve (book rides in advance for higher reliability), Uber Comfort, and targeted products like Women Preferred and Teen accounts are expanding the addressable market and pulling in new demographics who previously didn't use ride-hailing.

Engine 2: Delivery (34% of total revenue in Q4 2025)

Uber Eats grew revenue 30% year-over-year to $4.9 billion in Q4, exceeding analyst estimates. This business has quietly become one of the fastest-growing parts of Uber's platform, especially internationally.

The delivery segment isn't just about restaurant food anymore. Uber has expanded aggressively into grocery and retail (what they call "G&R" internally). Partnerships with Loblaws in Canada, Biedronka in Poland, Seiyu in Japan, Coles in Australia, plus OpenTable and Shopify integrations, have transformed Uber Eats from "order a burger" to "get anything delivered in 30 minutes." The grocery e-commerce market is projected to exceed $1.28 trillion by 2028 according to industry research from Brick Meets Click, and Uber's positioning itself to capture a meaningful slice.

International delivery growth is particularly strong. The Europe, Middle East, and Africa (EMEA) region posted the fastest delivery growth globally in 2025. Uber extended its category-leading positions in the UK and France while gaining share in Germany and Spain, historically tough markets for U.S. tech platforms.

The critical part is that the business achieved profitability in 2023 and has been expanding margins since. Adjusted EBITDA for Delivery improved significantly (the company doesn't break it out separately in every report, but directionally it's positive and growing). Higher-margin revenue streams like advertising and Uber One membership fees are boosting the unit economics beyond just taking a commission on food orders.

Engine 3: Freight (the smallest but fastest-improving segment)

Freight contributed $2.5 billion in the first half of 2025. This is Uber's logistics marketplace connecting shippers and truckers. It's been a drag on overall profitability historically, but the segment is stabilizing and positioned to benefit as supply chain digitization accelerates.

I'm not banking on Freight becoming a huge driver anytime soon, but it demonstrates Uber's ability to apply its platform expertise (matching supply with demand via an app) to adjacent markets beyond consumer mobility.

Engine 4: Advertising (the emerging high-margin business)

This is the sleeper opportunity almost nobody's talking about yet. Uber's advertising business is scaling fast and contributing meaningfully to revenue with margins far higher than rides or deliveries.

Uber has 202 million monthly active users opening the app multiple times per day. That's an advertiser's dream. Restaurants want to be featured prominently in Uber Eats. Consumer brands want to reach people in buying mode. Local businesses want targeted ads to nearby consumers.

Amazon proved that advertising on a commerce platform can become a massive, high-margin business. Uber's in the very early stages of building something similar. Management's challenge in 2026 is scaling ads without cluttering the app or degrading user experience. If they execute well, this could add several percentage points to overall margins over the next 3-5 years.

The market's treating Uber like a mature mobility company with 10-15% annual growth ahead. I think that's wrong. Here's why the stock could be worth $125-150 by late 2027.

Catalyst #1: Autonomous Vehicles Will Amplify Uber's Platform (Not Destroy It)

This is the most misunderstood part of Uber's story. Wall Street keeps asking, "What happens when Waymo and Tesla deploy robotaxis and cut Uber out?" But that's not what's actually happening on the ground.

CEO Dara Khosrowshahi stated on the Q4 earnings call:

"We're even more convinced that AVs will unlock a multi-trillion dollar opportunity. Autonomy fundamentally amplifies the strengths of our existing platform."

Let me translate what that means in practice.

In Austin and Atlanta, two cities where Uber partnered with autonomous vehicle providers in 2025, total trip growth "significantly accelerated" even for human drivers. The arrival of AV supply didn't cannibalize human-driven trips. It expanded the entire category by lowering prices and improving availability, which brought in new users and new use cases.

Even in San Francisco, where Uber doesn't yet offer robotaxi rides but where Waymo operates independently, Uber's trip growth actually accelerated in 2025. Khosrowshahi explained: "The addition of AV supply to the market has grown the category overall. Uber trips in SF accelerated in 2025, and they are growing faster than the rest of the U.S."

Think about the economic logic here. Uber's business model is simply taking 20-30% of the gross bookings from every ride. They don't care if the driver is human or robotic, they care about total platform volume. AVs lower the unit cost of rides (no driver to pay), which drops prices for consumers, which increases demand, and grows Uber's total addressable market.

Uber's strategy is to become the aggregator for multiple AV providers, not to build the technology itself. They tried that from 2015-2020 and it was a disaster that ended after a fatal accident in 2018.

The company now has partnerships with more than 20 autonomous vehicle firms including:

By the end of 2026, Uber expects AV trips available in 10-15 cities globally. By 2029, Khosrowshahi's goal is clear:

"We intend to be the largest facilitator of AV trips in the world."

But as investors, we need to keep in focus the fact that AVs will remain a small percentage of total rides for many years. Khosrowshahi himself cautioned that "autonomous vehicles are likely to remain a very small portion of the rideshare category for many years to come" due to technological, regulatory, and scaling challenges.

So what's the bull case?

AVs expand the total market (more trips at lower prices) while Uber maintains its 20-30% take rate on every trip. It's not a zero-sum displacement of human drivers and will result in category expansion that benefits the platform aggregator (Uber) more than anyone else.

If AVs grow to even 10% of total Uber trips by 2028 (conservative estimate), and they drive a 30-40% increase in total category size through lower prices and better availability, Uber's gross bookings could be $250-275 billion annually versus $193 billion in 2025. That flows through to revenue and profits at high incremental margins because the platform infrastructure already exists.

Catalyst #2: Delivery Growth Is Accelerating (Not Slowing)

Uber Eats grew 30% year-over-year in Q4 2025. For a business already generating $13.7 billion in annual revenue with 95 million users globally, that's remarkable acceleration and certainly not the deceleration you'd expect from a maturing platform.

The driver is international expansion plus category expansion beyond restaurant food. EMEA delivery growth was the fastest globally in 2025. Grocery and retail delivery is scaling rapidly through partnerships with major retailers (listed earlier). The grocery market alone is 10x larger than restaurant delivery, and Uber's just scratching the surface.

Uber Eats holds 23% of the U.S. food delivery market (second to DoorDash's 56%), but internationally it's often the category leader. In markets like France, Japan, Australia, and parts of Latin America, Uber Eats has #1 or #2 positions with room to consolidate as weaker competitors exit.

The profitability trajectory is what matters most. Delivery became profitable in 2023 and margins are improving as the business scales and higher-margin revenue (advertising, Uber One subscriptions) grows faster than lower-margin delivery commissions.

If Uber Eats can maintain 20-25% annual growth through 2027 while expanding margins by 1-2 percentage points annually, that segment alone could contribute $2-3 billion in adjusted EBITDA by 2027-2028 - double the current contribution.

Catalyst #3: Free Cash Flow Conversion Is Accelerating

This is where Uber becomes interesting from a value perspective and not just a growth story.

Full-year 2025 free cash flow was $9.8 billion, up 42% from $6.9 billion in 2024. For context, that's higher than the free cash flow of companies like Nike, Starbucks, or Adobe. On a market cap of roughly $150 billion (at current $75 stock price), that's a 6.5% free cash flow yield. That’s pretty compelling for a company still growing over 20% annually.

The company exhausted its inaugural $7 billion share repurchase program faster than expected and has a new $20 billion authorization announced in August 2025. Management's committed to being "active and opportunistic buyers" of their own stock.

Here's the math that matters for the investment case:

If Uber grows free cash flow 25-30% annually for the next 2-3 years (below recent trends but conservative given scale), you're looking at $12-15 billion in FCF by 2027-2028. Apply a 5% FCF yield (discount to current given growth) and you get a $240-300 billion market cap, implying a $120-150 stock price.

That doesn't require heroic assumptions about AV transformation or Delivery reaching Amazon-scale. It just requires the current business model continuing to improve margins while maintaining 15-20% topline growth.

At $75, Uber's sitting near a critical support level that's held multiple times since mid-2024.

The stock peaked at $101.99 on October 6, 2025, then consolidated in a wide $78-92 range through November-December. After Q4 earnings yesterday, it dropped to as low as $69.80 intraday (February 4, 2026) before recovering to close around $75.30.

Here's the technical setup I'm watching:

Support: $70-72 is the major support zone. This level corresponds to the 200-day moving average and the August 2025 lows. If Uber breaks cleanly below $70, I'm trimming my position because it signals the market doesn't believe the growth story.

Resistance: $85-87 is the first meaningful resistance. The stock needs to reclaim this level to confirm the dip was just earnings noise. Above $92, the path to retesting $100-102 opens up.

Volume: Yesterday's selling volume was heavy (32.31 million shares traded vs. 21 million average), which indicates real distribution and not just algorithmic noise. However, today's bounce back toward $77-78 on lighter volume suggests capitulation may have already happened.

Relative Strength: Uber's underperformed the S&P 500 by about 8% since January 1, 2026 (S&P up ~1%, Uber down ~7%). But over the past 12 months, it's still outperformed by about 35% (Uber up ~30%, S&P up ~14% from Feb 2025 levels). The recent underperformance feels like short-term noise, not a broken trend.

From a risk-reward standpoint, you're looking at $75 entry with a stop at $69 (8% downside risk) and a target of $110-115 over the next 12-18 months (47-53% upside). That's roughly 6:1 reward-to-risk, which meets my threshold for new positions.

I'm bullish on Uber, but I'm not stupid. There's one scenario that would make me sell immediately, and it has nothing to do with competition from Lyft or DoorDash.

The Real Risk: Gig Worker Reclassification

If U.S. federal legislation or a wave of state laws reclassify gig workers as employees rather than independent contractors, Uber's economics break completely. The company's model depends on paying drivers per-trip with no benefits, no minimum wage guarantees, and no employer taxes. If that changes, operating costs could spike 20-40% according to various analyses.

California tried this in 2019 with AB5 (later amended after Prop 22 in 2020). Europe has enacted stricter gig worker protections in multiple countries. The risk is that political sentiment continues shifting toward worker protections, which Uber can't easily absorb without massive price increases (which would destroy demand) or margin collapse (which would tank the stock).

Khosrowshahi's addressed this multiple times, arguing that drivers value flexibility over employment status and that Uber's committed to improving driver earnings and benefits within the contractor model. But if political winds shift, especially in a U.S. election year, this is the existential risk that changes everything.

What would change my mind? If two or more large U.S. states (California, New York, Illinois) pass legislation requiring employee classification without exemptions for gig platforms, I'm out immediately. The business model becomes unsustainable until AVs replace human drivers entirely, which is still 5-10 years away at scale.

Secondary Concerns:

Recession Risk: Uber's discretionary spending. In a deep recession, people cut back on ride-hailing and food delivery. The 2020 COVID period showed this. Mobility revenue dropped 50% when lockdowns hit. Uber pivoted to Delivery growth, which sustained the business, but a stagflationary environment (weak growth + high prices) could compress both segments simultaneously.

AV Transition Slower Than Expected: If regulatory hurdles, safety incidents, or technology limitations delay AV deployment by 3-5 years, the multi-trillion dollar opportunity gets pushed out, and Uber trades like a mature mobility platform with 10-15% growth rather than a platform positioned for exponential AV-driven expansion.

Advertising Execution: If Uber monetizes ads too aggressively and degrades user experience, it could drive users to competitors. This has to be managed carefully—similar to how Amazon balanced ad growth with customer satisfaction.

None of these are immediate crises, but they're worth monitoring. For now, the base case still holds: profitable platform, strong growth, massive AV optionality, reasonable valuation.

What I'm Monitoring:

If two or more of these indicators break negatively in the same quarter, I'll reassess the position. But for now, the weight of evidence supports maintaining exposure.

This isn't the cash-burning, growth-at-all-costs, Travis Kalanick chaos of 2015-2019. That Uber deserved to be treated like a speculative bet. This the 2026 version of Uber. This version is a profitable, cash-generating platform with 200 million monthly users, 22% growth, and optionality on a multi-trillion dollar autonomous vehicle future that's starting to materialize right now.

At $75, the stock trades at roughly 20x forward earnings (based on 2026 analyst estimates of ~$4.50-5.00 EPS). For a company growing 15-20% annually with accelerating free cash flow and massive AV optionality, that's mispriced.

Fair value is probably $95-110 today, with a path to $125-150 by late 2027 if the autonomous vehicle partnerships scale as planned.

I could be wrong. If gig worker reclassification becomes law, if AVs get delayed another 5 years, if a recession crushes discretionary spending, this stock could drop to $50-60. That's why I use stops and don't bet the entire portfolio on any single name.

But the base case - continued mid-teens growth, improving margins, AV expansion starting in 2026-2027, and $12-15 billion in annual free cash flow by 2028 - that's a pretty solid setup over the next 18-24 months. That's worth a position in my portfolio at current prices.

The question for you is whether or not you can stomach a 30% drawdown if gig worker legislation passes or if macro conditions worsen.

If yes, and if you believe AVs will expand mobility rather than destroy Uber's business, this is probably the best entry point you'll get for the next 12 months. If not, wait for better visibility or stick to index funds.

Not every opportunity is for every investor, but this one's for me.

The Earnout Investor provides analysis and research but DOES NOT provide individual financial advice. Jamie Dejter may have a position in some of the stocks mentioned. All content is for informational purposes only. The Earnout Investor is not a registered investment, legal, or tax advisor, or a broker/dealer. Trading any asset involves risk and could result in significant capital losses. Please, do your own research before acquiring stocks.