Uber Technologies (NYSE: UBER) saw its shares climb 7.2% to $74.70 during Wednesday morning trading, as the ride-hailing and delivery giant continued to expand its Uber Eats retail marketplace and advance its autonomous vehicle partnership strategy. The move also lifted shares of rival Lyft (NASDAQ: LYFT), which rose 5.5%, while Tesla (NASDAQ: TSLA) remained flat.
The company announced the addition of several major retail brands to its Uber Eats platform in the United States, including Kiehl's, FedEx Office, Blick Art Materials, Academy Sports + Outdoors, and Choice Pet. These new partners will be available through Uber Eats, Uber, and Postmates apps. "Customers are using Uber Eats for more than meals," said Hashim Amin, head of retail for North America at Uber, highlighting the company's strategy to broaden its delivery ecosystem beyond food.
Uber's delivery push comes as investors scrutinize the long-term value of its platform against the potential disruption from autonomous vehicles. The company reported strong first-quarter results, with gross bookings rising 21% on a constant-currency basis to $53.7 billion, and total trips increasing 20% to 3.6 billion. Monthly active platform consumers grew 17% to 199 million. Chief Financial Officer Balaji Krishnamurthy emphasized the company's "capital-efficient approach to AVs," referring to autonomous vehicles.
Wall Street remains largely bullish on Uber's prospects. The consensus price target from 36 analysts stands at $108.35, according to Benzinga. Tigress Financial recently reiterated its buy rating and raised its price target to $115 from $110 on June 12.
Uber's autonomous vehicle strategy relies heavily on partnerships rather than in-house technology. The company has an agreement with Nuro to deploy at least 35,000 Lucid vehicles equipped with Nuro's self-driving technology on the road by 2032. The first Uber-branded robotaxis are expected to launch in a major U.S. city by late 2026. However, recent cost-cutting measures at Lucid, including plans to lay off about 18% of its U.S. workforce and eliminate the chief operating officer role, have raised some supply concerns. BNP Paribas analyst James Picariello told Business Insider he saw "no real direct implication" for Lucid's Uber-Nuro robotaxi program.
Uber is also expanding its robotaxi presence internationally. The company and Chinese autonomous driving firm WeRide announced plans to launch commercial robotaxi rides in Zurich by the end of 2025, pending regulatory approval. Sarfraz Maredia, Uber's global head of autonomous mobility and delivery, said the company plans to leverage its "operational expertise" in the Swiss rollout.
Competition in the autonomous vehicle space remains intense. Alphabet's Waymo is already operating via Uber in Austin and Atlanta. Tesla's robotaxi service is currently limited to Dallas, Houston, and Austin, with reports of long wait times in the Texas capital.
Uber could also receive a boost from the potential IPO of Lime, the electric scooter and bike-sharing company backed by Uber. Reuters reported on Monday that Lime is seeking a U.S. IPO valuation of up to $1.66 billion, with Uber expressing interest in purchasing up to $20 million of shares in the offering. IPOX Research Associate Lukas Muehlbauer noted the valuation "does not look excessive" but flagged risks around permits and operating costs.
However, Uber faces ongoing challenges beyond robotaxi timing. A shareholder lawsuit filed against the company's board alleges lapses in compliance related to sexual abuse lawsuits and safety problems. Uber has dismissed the lawsuit as misleading, stating it omits key facts from earlier court cases that the company has already addressed.
