Uber’s robotaxi ambition to face scrutiny as shares languish

[PHOENIX/SAN FRANCISCO] The breakdown of Uber Technologies’ robotaxi partnership with Alphabet’s Waymo is looming large over the ride-hailing giant’s quarterly results, as investors grow anxious about the stock that has lagged the broader market this year.   

San Francisco-based Uber is estimated to report a 13 per cent year-on-year jump in second-quarter revenue on Wednesday (Aug 5).

Its shares, however, have slumped 28 per cent since reaching a record high of US$100.10 in October 2025; over the same period, the S&P 500 Index gained 13 per cent, and the technology-heavy Nasdaq 100 climbed 15 per cent.

Analysts and investors believe that even strong performance in its mobility and delivery segments will not be enough to send shares back towards their record high.

That is unless the company is able to show its endeavours to offer self-driving taxis on its platform are going according to plan.

“A clean mobility print would stabilise sentiment, but a durable recovery requires Uber to address the structural question head-on,” said Dave Mazza, CEO at Roundhill Financial. 

Investors want proof that Uber’s push into vehicle autonomy will expand its ride-hailing business, he added. “That proof comes from deployment numbers, not commentary.”

Uber has partnered a slew of companies working on autonomous driving technology in recent years, including privately held Nuro and Amazon’s Zoox. Still, a partnership with Alphabet’s Waymo – widely seen as the market leader in the space – carried its own weight.

It explains why the market reacted strongly to the news of the pact falling apart.

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First, in June, Uber wound down its robotaxi partnership with Waymo in Phoenix. Then in late July, news that Waymo was exploring options to exit its existing, exclusive robotaxi partnership with Uber sent the stock down 4 per cent for the day. 

It is still possible that the companies would come to an understanding that would allow Waymo to have its vehicles both on its own app and the Uber app.  

The unwinding of the exclusive pact prompted Morningstar analyst Mark Giarelli to lower his fair-value estimate on Uber to US$76 per share from US$85, citing growing competition from Waymo, especially in urban areas where Uber commands a strong pricing power.

Roundhill’s Mazza said his firm would sell its Uber shares if autonomous-driving firms such as Waymo can prove that they can run and scale without a centralised ride-hailing network. 

“Until then, the math still favours the platform,” he said. 

Uber, meanwhile, still sees “very, very healthy trends” in markets such as San Francisco where Waymo has operated for some time, said CEO Dara Khosrowshahi during the company’s first-quarter earnings call in May.

Meanwhile, Waymo’s fleet consists of over 3,000 vehicles across more than 10 US cities, which is just a small fraction of Uber’s current operations. 

The current declines in Uber shares come as the broader market is souring on high-flying artificial intelligence stocks, with investors getting wary about riskier growth names with an ambitious but still-unproven strategy.

Though Uber isn’t a big AI spender – like Waymo backer Alphabet, or Meta Platforms – and therefore has avoided the worst of the backlash against swelling capital expenditures, the firm still has to prove that it can turn its lofty promises into concrete profits.

Uber shares trade at about 18 times their 12-month forward earnings estimates, below the S&P 500’s average of 20. To some, that muted multiple suggests any decline in the stock can stay limited.

It also partly explains why Wall Street remains fiercely bullish on the stock. Of the 58 analysts covering Uber, about 86 per cent recommend buying the stock, according to data compiled by Bloomberg. Only one analyst has a sell rating.

Analysts are not nearly as optimistic toward Lyft, with only about one-third recommending buying the shares. 

Despite being convinced about Uber’s long-term prospects, analysts are paring their short-term earnings outlooks. Estimates for Uber’s 2026 annual profits are down over 17 per cent from a year ago, data compiled by Bloomberg shows.

“If anything, it tells me the street is becoming more patient about the timing of the payoff rather than questioning the underlying business,” said Haris Khurshid, chief investment officer at Karobaar Capital, which owns Uber stock. BLOOMBERG