Uber Sees Major Potential for Expansion in the US Market

Uber might appear to be a staple in the US transportation landscape, but according to the company's CFO, Prashanth Mahendra-Rajah, there is still considerable scope for growth in their home market.

At a recent presentation during the UBS Global Technology and AI Conference, Mahendra-Rajah revealed that approximately 15% of adults utilize Uber either for hailing rides or for delivery across the ten major markets the company operates in, highlighting this as a measure of 'market penetration' used by Uber and similar businesses.

Room to Capture More US Customers

In line with this international figure, Uber's market presence in the US mirrors the 15% statistic, suggesting that there is a vast untapped audience still to be reached domestically.

To investors, this may come as a surprise given Uber’s visibility and frequent use in various urban centers across America. Yet, as Mahendra-Rajah elaborated, the habitual use of Uber for airport commutes or food delivery often seen among city residents does not extend universally throughout the country.

Urban and Suburban Opportunities

Investors often assume they or their children have maximized their use of Uber and its services. However, Mahendra-Rajah pointed out that these users are not representative of the average American, which fuels Uber’s confidence in its future potential.

Despite Uber's success in ride-sharing and delivery sectors, the company is targeting growth in other segments. For suburban users, increasing the app’s appeal for routine activities such as dinners or shopping trips is a key strategy, as indicated by the fact that suburban or 'sparser market' trips comprise approximately 20% of Uber's total journeys, a figure consistent with earlier statements this year.

Expansion in Rural Areas and New Ventures

In more rural regions where travel distances are longer, there is also growing attention for the ride-hailing and delivery services Uber provides.

Additionally, Uber is broadening its partnership with major supermarket chains and retailers to bolster its delivery operations, a development mentioned by Mahendra-Rajah at the conference.

Exploring Artificial Intelligence

Venturing beyond transportation, Uber is venturing into artificial intelligence training. Through its AI Solutions arm, the company has recruited highly educated professionals for initiatives like Project Sandbox, although this specific project wrapped up prematurely according to a report by Business Insider.

Dara Khosrowshahi, Uber's CEO, echoed on a November earnings call that expansion into AI training aligns with Uber’s ambition to evolve into a comprehensive 'platform for work.'