Alex Moazed

I own a material amount of $UBER, and if the wife thought she could stop hearing about it, she was WRONG. One of the first things that should jump out to you from 4Q results is that user counts were very strong. The first chart way down below is quarterly MAPC y/y, which the last several quarters has been accelerating. Not bad for a company at such massive scale and n.b. that most SS models assume MAPC growth rates decelerate, as that's a natural starting point assumption. There are several squishy reasons one could imagine why MAPC might be outperforming. Generally speaking, two sided marketplaces benefit from liquidity so they often have accelerating returns to scale. Eats is a more luxury good so it should be later in its maturation curve. Int'l expansion. Millennials are fiscally irresponsible morons who never got drivers licenses. Etc. Given I'm a HF guy though, we'll use data. For this exploration we are going to use Massachusetts reported annual ride share data by metropolitan area, which is one of my favorite reported alt data sets I've ever seen. Just fantastic insights within it. Anyways, Massachusetts rideshare consumption rose 15% in 2024. It will not shock you to learn that many people in Massachusetts live in Boston. Boston + Cambridge are 11% of the population, and that excludes all the assoicated big suburbs like Brookline, Revere, Newton, etc all of which are ~1% each etc. It will also not shock you to learn that generally speaking, Boston is rich, and many of the out of the way parts of Masachusetts are shitholes. If we simply decompose Massachusetts ride share consumption growth into Boston, Cambridge, and ex-B+C we see that B&C are growing ride share consumption around 10% per year. But the other regions are growing at 22%!!!! Including some real standouts. Tier 2 cities like Worcester and Lowell are growing 25% and 21% y/y. There is effectively a 12 point gap of outgrowth in the less dense areas. We can then look at per person consumption. Boston contributes 59.6 rides per person per year. Cambridge contributes 47 rides per year. Meanwhile the average Massachusetts ex-B&C municipality contributes 4.7 rides per person per year. This is dragged down by a bunch of rural areas at ~0 per person, but the Tier 2 cities of Worcester and Lowell are at 11x and 3.7x per person per year respectively. So on an order of magnitude, ride share intensity is ~5-10x+ higher in the densest cities. Meanwhile, per person consumption for Boston & Cambridge is growing around 9.5% (n.b. this approximates its total growth rate. This makes sense because intuitively no shit everyone in B&C has Uber installed on their phone). But the average per resident growth rate in ex-B&C areas is 24% (!!!). In our Tier 2 city examples of Worcester & Lowell it's 26% and 34%. Massachusetts regional populations are (probably) not growing 24% per year on average, so here we have our statistical indication that indeed a lot of people are still only starting to incorporate rideshare into their life in a meaningful way. There are three primary takeaways here. The first is that growth is effectively de-risked for the intermediate term. Waymo, Tesla, and friends could drive B&C growth to literally 0 and there would still be ~7% total growth for Massachusetts rides (51% of the total ride base growing at ~15% per year). Waymo, $TSLA, and friends are not going to drive B&C consumption to flat in 2026 given that the services don't exist yet and won't until late 2026 at the very earliest. So even in big, mature markets like Boston, double digit KPI growth is extremely likely. That's honestly amazing. Secondly, the TAM is fucking huge. Unbelievably large. The vast majority of people in Massachusetts don't use ride share at anything approximating the usage of the urban centers, let alone the usage of a HF asshole in New York. AV will collapse a lot of urban adjacent ride share profiles towards the urban which alone is a massive usage expansion. And that's before we unlock material new use cases from AV (longer commutes, more travelign to the Cape, kids can travel unsupervised to friends', less drunk & high driving, etc). Thirdly and perhaps most importantly, contrary to popular fears, Uber has time. The predominance of their growth is in the areas that are LEAST susceptible to immediate AV disruption by $GOOGL and TSLA. Google and TSLA very clearly in 2026 and 2027 will not and cannot reach the Worcestors and Lowells of the world, let alone the random suburbs on the Cape or Nantucket (growing 20% y/y) or even the big bulky Boston suburbs like Brookline (growing 12% y/y). Uber has many partners. LCID, May, Wayve, WeRide, Pony, NVDA, Waabi, STLA, Nuro, Motional. These are all names that are EXPLICITLY adding and going to add AVs to the Uber network. Pick a timeline for when you believe Waymo or TSLA will be able to start meaningfully generalizing their fleets to the ex-B&C areas we've been discussing. 2027 at ealiest? 2028? 2029? Well then, as long as one or some of the above listed partners have started to scale their own AVs into the Uber network by that point, then Uber's AV internalized outlook is also extremely strong. Based on the realized progress and steps thus far, that's extremely likely. It's literally already happening. You can call a car via Avride in Dallas. May Mobility in Texas. WeRide in half the Mid East. Baidu too today. Wayve in London expected this spring. LCID allegedly going to onramp like 6k cars into the Uber network. By the time Waymo and TSLA start reaching the long tail of Uber growth & TAM expansion, all these partners will be competing too, and they'll be competing via the Uber network's liquidity. We haven't discussed delivery at all here, but note it has a lot of the same characteristics in terms of growth that it is still a relatively a low penetration luxury good that benefits from rising marketplace two sided liquidity. And as it grows mind share it becomes stickier + perpetuates lifestyle changes that ingrain it further into consumption patterns We also haven't discussed advertising which is 2bn sales growing 50% y/y (lol) We also haven't discussed that Uber validly has a differentiated long term value prop via the complete integration of mobility + delivery + freight. So we have a company that has derisked DD+ topline growth for at least two years, that trades at an ~6.5% forward FCF yield, that is buying back ~1% of its market cap per quarter, that has 9bn of investments held, that is ~0.5x levered, that has clear visibility into its TAM growing enormously, that grows EBITDA at almost 30% incremental margins, that has around 20% FCF margins, that has no Claude disruption risk, and that has a call option on being the absolute top winner in the space Time to make some money!

grok is seeing high usage across the world and we're working hard to scale the GPUs up to meet the demand - you might see some temporary issues as we scale

BREAKING: Majority (52%) of American voters believe the Democrats kept the border open deliberately -- Harvard/Harris

Sam Altman on May 16, 2023: "I have no equity in OpenAI." "I'm doing this because I love it."