Despite its widespread presence in the United States, Uber still sees significant potential for growth, according to the company’s Chief Financial Officer.
In a recent presentation at the UBS Global Technology and AI Conference, Uber CFO Prashanth Mahendra-Rajah highlighted that only about 15% of adults in the top 10 countries where Uber operates use its ride-hailing or delivery services. This metric, known as market penetration, reflects the reach of consumer-focused companies like Uber. Mahendra-Rajah noted that Uber’s market penetration in the U.S. aligns with this average, indicating untapped opportunities in its home market.
For investors, this figure might seem surprisingly low given Uber’s prominence in various regions across the country. Mahendra-Rajah pointed out that many urban residents have integrated Uber into their daily routines for rides to the airport or food deliveries, often using Uber or its competitors like Lyft and DoorDash regularly. However, this is not the case for every American, he remarked.
He explained, “Among Uber investors, ‘it’s often a view of: There is no way I could use Uber anymore than I am, and there’s no way my children can order Uber Eats more than they already do.’ But you are really a unique case compared to the US average. That’s why we remain very optimistic.”
Uber has established substantial businesses in both ride-hailing and delivery, yet it continues to seek areas for expansion. While the app is well-used in cities, Uber is targeting suburban areas to increase usage for dining outings or bulk deliveries from stores like Costco. Suburban or “sparser markets,” as labeled by Uber executives, currently account for approximately 20% of Uber’s total trips.
Furthermore, rural regions, where the distances for rides and deliveries are generally greater, have become a newer focus for Uber and similar apps. To bolster its delivery sector, Uber Eats is partnering with more supermarket chains and retailers, as confirmed by Mahendra-Rajah.
In addition to its core services, Uber is venturing into the AI training sector. The company’s AI Solutions division has recruited skilled professionals, including those with PhDs, for projects like its recently concluded Project Sandbox. CEO Dara Khosrowshahi elaborated during a November earnings call that this move is part of Uber’s strategy to evolve into a more comprehensive “platform for work.”
