Uber Technologies, Inc.

Good day and thank you for standing by and welcome to the Uber Q2 2021 earnings conference call. At this time, all participants are in the listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Balaji Krishnamurthy, Head of Investor Relations. Please go ahead.

Thank you, Operator. Thank you for joining us today, and welcome to Uber Technologies' second quarter 2021 earnings presentation. On the call today, we have Uber CEO Dara Khosrowshahi and CFO Nelson Che. During today's call, we will use both GAAP and non-GAAP financial measures and additional disclosures regarding these non-GAAP measures, including a reconciliation of GAAP to non-GAAP measures, are included in the press release, supplemental slides, and our filings with the SEC, each of which is posted to investor.uber.com. As a reminder, these numbers are unaudited and may be subject to change. Certain statements in this presentation and on this call are forward-looking statements. Such statements can be identified by terms such as believe, expect, intend, and make. you should not place undue reliance on forward-looking statements. Actual results may differ materially from these forward-looking statements, and we do not undertake any obligation to update any forward-looking statements we make today, except as required by law. For more information about factors that may cause actual results to differ materially from forward-looking statements, please refer to the press release we issued today, as well as risks and uncertainties described in our most recent annual report on Form 10-K, for the year ended December 31, 2020, and in other filings made with the SEC when available. Following prepared remarks today, we will publish the prepared remarks on our investor relations website, and we will open up the call to questions. For the remainder of the discussion, all second quarter growth rates reflect year-over-year growth and are on a constant currency basis unless otherwise noted. For July trends, we will be providing comparisons with July 2019 in addition to year-over-year trends. Lastly, we ask you to review our earnings press release for detailed Q2 financial review and our Q2 supplemental slide deck for a number of additional disclosures that provide context on recent business performance. With that, let me hand it over to Dara.

Thanks, Balaji. On our last call with you, we said that we will lean in to reignite driver and career growth. We've done so aggressively, and we make significant progress. Matching Matching and balancing supply and demand, market by market, at the right times, at the right places, and at the right price is the key to our marketplace, and we do that better than anyone else in the world. As a result of our driver-focused investments, everything from refreshed digital marketing to more attractive incentives to good old-fashioned phone calls to folks we haven't seen in a while, monthly active drivers and couriers in the U.S. organically increased by 420,000 from February to July, and we gained an additional 110,000 active couriers from our Postmates migration. In particular, the number of mobility drivers in the U.S. ended the quarter up 75% year-on-year in June. We also made several operational and product improvements to the onboarding process that led to nearly a quarter of new drivers signing up to both drive and deliver, and we cut courier onboarding time by over 90%. We continue to see strong earner momentum early in the second half of the year, and we've been able to taper our short-term incentives as we hit our stride. The good news is that drivers increasingly want to get back on the road. In June, 60% of inactive drivers told us they intended to start driving again within a month. That's up from 40% in April. And 90% of drivers told us they expect to come back by September. We're also beginning to see marketplace metrics revert to normalcy in several markets, with surge levels and wait times back to nearly normal in Miami, Atlanta, Dallas, Houston, and Phoenix. But in major cities like New York, San Francisco, and L.A., demand continues to outplay supply, and prices and wait times remain above our comfort levels. Our investment in the earner experience is a fundamental cross-disciplinary and long-term initiative for our company. From doubling down on our app quality, to targeted and personalized re-engagement campaigns, to completely redesigning our onboarding flow to make it easier and faster than ever to earn safely, to rolling out unique programs like free language learning from Rosetta Stone or free tuition with ASU. Our earner super app is unique in the depth and breadth of earnings opportunities we can offer drivers and couriers globally. We have a lot of work to do, and it's on us to ensure Uber remains the most attractive and rewarding platform for on-demand work in the world. I also want to acknowledge the Delta variant. Thanks to the incredible effectiveness of the vaccines, we continue to see GB growth in our business from June to July, despite the impact of the new variants. Where markets are recovering, our mobility and delivery businesses are emerging stronger together. As of last week, our total gross bookings in New York City, London, and Paris are over 30% higher than July 2019, as mobility has made a nearly full recovery. Nelson will have more specifics, but we have confidence in our ability to manage through any scenario, just as we've done over the past 500 plus days. Our ambition is to help people go anywhere and get anything. Whether they first came to Uber via rides, eats, or freight, consumers, merchants, companies alike are increasingly getting used to doing more with Uber. During the pandemic, we've shown how each of our multiple business lines can provide a hedge against the others. But more exciting is how innovation in our product and brand is driving cross-pollination between our customer bases. In other words, our businesses do provide a hedge, but more importantly, strengthen one business can strengthen the others. You're well aware by now that the Rise app is acting like a free marketing engine for a delivery business. What may be less obvious is that delivery is now increasingly driving consumer acquisition for mobility. That's because in many markets, especially suburbs and smaller towns, Eats is sometimes the first way consumers engage with Uber. We've launched proactive efforts to convert these Eats first customers into Uber riders. In Q2, over 20% of mobility's first-time riders in the U.S. and more than 40% of first-time riders in the U.K. were existing delivery consumers, with its contribution rapidly growing over the last year. Over time, we expect our growing new verticals business to increasingly benefit from and contribute to our platform. Already over 3 million consumers are ordering groceries, convenience items, alcohol, and more on Uber's app each month, and this is before we've even fully addressed the U.S. opportunity. Notably, consumers acquired through one of our new verticals offerings spend more than twice as much as consumers acquired through our restaurant delivery offering. We're beginning to broadly roll out grocery powered by Corner Shop in the U.S., having doubled our footprint to more than 400 cities in the last few weeks, and expect this to be the next pillar of growth for Uber. Underpinning all of this is our membership program. Just a year ago, we began to roll out Uber Pass in earnest. It now drives 30% of delivery GVs in the U.S. and roughly 25% globally. Consumers who regularly engage with both mobility and delivery now count for nearly half of our total company gross bookings. For these consumers in particular, PATH is a no-brainer, and we see a long runway for increased adoption. We're also seeing the benefits of cross-platform synergies for merchants and other businesses. Uber remains the largest global on-demand delivery platform outside of China, with more than 750,000 monthly active merchants on our platform. And our leadership position continues to grow. We're now the category leader in eight of our top ten delivery markets, with clear number two positions in the U.S. and the U.K., We're proud that Uber Eats, Postmates, and Corner Shops has helped many small businesses offset the loss of in-store traffic during the lockdowns. But as cities reopen, these merchants are discovering that delivery demand is additive even as in-store traffic comes back. Merchants have increasingly embraced their ads offerings to drive significant demand amplification at a reasonable cost. Our original goal with the exit this year with 100 million of ads around rate revenue, but we now expect to surpass that goal and 2022 with at least $300 million in run rate revenue in high margin ads. Beyond last mile delivery, Uber is increasingly powering first and middle mile logistics with Uber Freight. Notably, roughly 50% of our freight volumes come from grocery and consumer staples shippers. Freight has successfully disrupted the freight brokerage market with their innovative technology and is now one of the largest digital freight brokers globally, excluding China. we believe there's a large opportunity to be the preferred end-to-end logistics partner for shippers. Eighty percent of shipper decision makers manage both full truck loads as well as last-mile shipping, and almost 60 percent of survey customers have last-mile needs. With a pending acquisition of TransPlace, we have the potential to create the first end-to-end digital logistics platform that could one day power the movement of goods all the way from point of production to the consumers. While none of us can predict the macro future or the effects of the Delta variant going forward, we continue to see Uber gaining momentum as we expand our services and footprint and become a bigger part of the daily local habits of millions of consumers, earners, merchants, and shippers all over the world. We see the path to sustainable and improving EBITDA profitability in the next six months, but it's our growth potential over the next five to ten years that has me and the team excited and hungry to Uber on. Now over to Nelson. Thanks, Dara.