Uber Technologies Inc (NYSE:UBER, ETR:UT8) is expected to beat first-quarter estimates this week due to favorable foreign exchange trends, resilient food delivery demand, and strong growth in new mobility segments offsetting modest US travel softness.
Bank of America said it expects Uber to post first-quarter results that come in ahead of Wall Street estimates, pointing to what it called an “attractive” valuation based on free cash flow and growing investor confidence in Uber’s long-term position in the autonomous vehicle (AV) ecosystem.
Delivery was likely stable in the quarter, BofA said, while Uber’s Mobility segment may have been modestly impacted by slowing airport travel. However, this was likely offset by strength in “New Verticals,” which the firm estimates contributed six percentage points to Mobility growth.
App data and card spend suggested positive momentum for Mobility.
Looking ahead, the firm raised its second-quarter gross bookings estimate by 2% to $46.7 billion, compared with Street consensus at $45.8 billion. “We think positive FX should more than offset any travel related trip pressures,” they wrote.
BofA expects Uber to guide for second-quarter bookings in the range of $45.25 billion to $46.75 billion and adjusted EBITDA of $2.01 billion to $2.11 billion, assuming roughly 8% incremental margins. “EBITDA outlook may assume reinvestment of FX upside in growth initiatives,” the analysts noted.
The bank also downplayed ongoing investor concerns over automation and trade policy risks, suggesting Uber is well-positioned relative to its gig economy peers.
“We continue to see the gig economy group as well positioned for tariff uncertainty, and Uber as a top pick in 2025 as we expect sentiment on Uber's positioning in the AV ecosystem to improve,” the analysts wrote.
While Uber shares have climbed 40% year-to-date—compared to a 7% decline in the Nasdaq—BofA said valuation remains compelling.
Uber is set to report its results on Wednesday.