Uber Technologies on Wednesday lowered its near-term profit outlook relative to market expectations, citing a mix of higher taxes, investments in lower-cost ride options and an accounting change that will reduce reported mobility margins. The company said these factors are tempering adjusted earnings per share despite accelerating trips and gross bookings growth.
For the first quarter, Uber expects adjusted earnings per share of $0.65 to $0.72, below consensus of $0.76. For the fourth quarter, Uber reported adjusted EPS of $0.71, missing the $0.79 figure analysts had anticipated. Gross bookings for the first quarter are projected at $52.0 billion to $53.5 billion, above the $51.16 billion estimate compiled by LSEG.
Uber's guidance included a materially higher adjusted effective tax rate (ETR) than in prior communications, with management forecasting an ETR between 22% and 25% for the year. The company said the ETR reflects operating activity across more than 70 countries and produces a tax profile comparable to large U.S. multinationals with significant global footprints.
Volume metrics remained strong in the fourth quarter. Trips rose 22% year-over-year as consumers increasingly chose Uber’s lower-cost mobility options, including shared rides and other affordable products. The company had previously signaled that it would moderate the pace of margin expansion, emphasizing investments that accelerate mobility growth even if they compress near-term margins.
Uber said those affordability investments and low-cost product offerings helped drive mobility growth, even as they weighed on margin improvement in the near term. Management flagged improving pricing conditions and lower insurance costs in the U.S. as potential supports for faster domestic growth and margin expansion in the year ahead.
On the corporate governance front, Uber disclosed a finance leadership change. Prashanth Mahendra-Rajah, who became chief financial officer in November 2023, will step down. Balaji Krishnamurthy, a former Goldman Sachs executive who joined Uber in 2019, will assume the CFO role.
The company also announced an accounting change for portions of its U.K. business effective January. Uber said this change will lower reported mobility revenue margin by roughly 350 basis points in the first quarter and for 2026, while not affecting underlying profitability.
Operationally, Uber continues to expand both mobility and delivery. The fourth quarter saw growth in both segments, with delivery gross bookings increasing faster than mobility. Management noted that segments such as convenience services are experiencing strong demand; these offerings generally carry lower margins than traditional ride-hailing.
Looking further ahead, Uber described its positioning for the autonomous ride-services market, naming partnerships with Alphabet’s Waymo and Lucid as examples of how it plans to integrate robotaxis alongside human drivers as autonomous services scale. The company is portraying itself as a facilitator for mixed fleets of autonomous and human-driven vehicles.
Shares reacted negatively in premarket trading, falling more than 8% after the company provided its updated guidance and tax outlook. The company had earlier moved from reporting adjusted core profit guidance to providing adjusted profit per share, a change intended to give investors a clearer view of recurring operating performance.
Key context and metrics:
- First-quarter adjusted EPS guidance: $0.65 to $0.72 (vs. street $0.76)
- Fourth-quarter adjusted EPS: $0.71 (vs. expected $0.79)
- Trips growth in Q4: +22%
- First-quarter gross bookings guidance: $52.0 billion to $53.5 billion (vs. $51.16 billion estimate)
- Adjusted effective tax rate expectation for the year: 22% to 25%
- Accounting change impact on reported mobility revenue margin: ~350 basis points lower in Q1 and for 2026
Implications
Uber’s communications highlight a tension between driving top-line engagement through lower-cost products and protecting near-term margin trajectories. Management is prioritizing affordability and volume gains while acknowledging that these choices, alongside tax and accounting shifts, will reduce reported per-share profitability in the near term.
Changes in financial leadership and the accounting treatment of parts of the U.K. business add additional variables investors will track as the company reports results and issues forward guidance.