$Uber Tech(UBER.US) 3Q24 first take: As one of the consensus longs in the U.S. stock market, Dolphin Investment Research has always had strong confidence in Uber. However, after this earnings release, the stock fell more than 10% in pre-market trading, and the decline is still around 7% to 8%. What caused the pre-market plunge? Let's try to unravel the reasons:

1) Looking at various indicators, the most obvious shortcoming is that the Bookings for the Mobility ride-hailing business were slightly lower than expected by 1.8%, with actual year-on-year growth dropping to 17.3%, instead of the expected 19.4%. Indeed, Dolphin Investment Research does not deny that the more pronounced slowdown in the company's core business compared to expectations is a negative signal that cannot be ignored. Recently, due to the high attention on autonomous driving and the launch of the "Price Lock" low-price product by its main competitor Lyft, the market has had concerns about Uber's long-term barriers in the ride-hailing business and the competition for market share in the short to medium term. Therefore, this miss will indeed "add fuel to the fire" of these concerns, raising worries about whether Uber is truly losing market share.

2) However, aside from the miss in Mobility gross bookings, the growth rates, revenues, cost control, and key profit indicators like adjusted EBITDA for other businesses all met or slightly exceeded expectations. The guidance for total gross bookings and adjusted EBITDA for 4Q also aligns with expectations. Thus, looking at the financial report, aside from the "less than 2%" miss in Mobility order amounts, there are no fundamentally significant red flags in Uber's performance. Overcoming the expectation gap, the company's core business has nearly 20% and slightly declining stable growth in Bookings & revenue, combined with over 50% growth in profit indicators, undoubtedly reflects a good state of both growth and accelerated profit margin release.

3) Therefore, Dolphin Investment Research does not believe that there are any serious issues in this earnings report that warrant a nearly 10% drop. More so, under the principle of "profits and losses stem from the same source," the market had already priced in quite full expectations for the consistently bullish Uber. Even after the drop, the market capitalization corresponds to a profit expectation for 2026, still showing a valuation of slightly over 20x PE. It is evident that the market has already priced in Uber's growth for the next two years. Thus, the market's affirmation of Uber's expectations is not merely based on in-line performance (which would imply no excess returns in the following two years). For an expected "100" score student, a passing paper will be seen as "failing the exam."