Uber is in discussions with numerous banks and private institutions to receive funds for expanding its Robotaxi services. CEO Dara Khosrowshahi on Wednesday proposed an offer to several companies, in licensing software for autonomous driving technology, involving paid partners owning such vehicles at a fixed rate, sharing revenue with fleet operators and owning Robotaxi vehicles.
“We’re talking to private equity players. We talked to the bank,” the CEO said. “Provement of our revenue model, proven how much these cars can generate per day will allow a lot of money to flow.” Currently, Uber plans to fund its deployment using the “conservative” portion of its cash flow of about $7 billion a year. Additionally, the company also said it may be selling minority stakes in the company to help it expand.
Uber is an Austin and Atlanta ride app and already offers Robotaxis from Alphabet-owned Waymo. It also won a $300 million partnership in July, and will be able to deploy more than 20,000 vehicles manufactured by electric vehicle company Lucid for over six years with autonomous driving technology. At the time of pressing, Uber stocks have now dropped by 0.5% today, but have risen by 1% over the past five days.
Analysts say the deployment of Mass Robotaxi could reduce operating costs for driver-dependent Uber and increase profitability. The company has already posted its quarterly revenue for the third quarter, falling below Wall Street expectations. Uber showed strong demand and effective cost management with a 17% increase in total bookings and an 18% increase in revenue. The company has launched a $20 billion share buyback program, with its third quarter booking outlook for further growth between $48.25 billion and $49.75 billion.
Analysts maintain Uber’s bullish outlook with price targets ranging from $92 to $110, suggesting a huge potential with current market prices of $89.39. Uber said it could hit a $200 high next Analyst Jim Kramer In CNBC’s Mad Money segment. He also called the company a “cash flow juggernaut” and urged investors to “buy more” even at the current level. “Now Peter asked, should he stay or sell? But do you know what he should do? (Buy, buy, buy). It’s a skepticism I like, healthy skepticism, but the stock is worth buying here,” Kramer said.
