Just last weekend I used Uber. I opened the Uber app after a day out to request a ride home. The first driver canceled for some reason. So I had to wait for another one.
The estimated arrival time was close to 10 minutes, and the fare on my screen hadn’t changed. I thought it was because it was a little late and just saw it as a minor inconvenience.
But looking back today, after listening to an Uber CEO interview, I realized that when demand outpaces the number of available drivers, the cost isn’t always a higher fare. Sometimes, you pay with your time.
My small frustration connects directly to what Uber CEO Dara Khosrowshahi told CNBC’s Squawk Box on Nov. 4.
We have more demand than we have supply. Demand, especially for mobility services, is exceeding the supply of drivers and couriers on our platform.
Uber (UBER) is down 14.49% year-to-date and 26.20% over the past year, according to Yahoo Finance, even after a quarter in which almost every headline number grew. I’ll get into both intensively.
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The problem with a very good Uber quarter
Uber reported its third-quarter 2026 financial results on Nov. 4, 2026.
Q3 2026 gross bookings grew 20% year over year to $59.8 billion, according to Uber’s earnings release. Trips rose 16% to 4.1 billion. Monthly active platform consumers grew 14% to 215 million, a record. Adjusted EBITDA grew 31% to $3.0 billion, and gross margin on gross bookings rose to 5.0% from 4.5%.
GAAP net income was $512 million, including a $476 million pre-tax loss from the revaluation of equity investments. Revenue grew 10% to $14.8 billion, held back by eight points from business model changes.
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So why is the stock down? Because demand running ahead of supply is a good problem, but it still costs money to fix. Actually, Khosrowshahi did mention that. Uber is now investing heavily in driver and courier supply in India, Brazil, Canada, and even the U.S.
His refusal to raise fares is the most notable part to me.
“Unlike the Silicon Valley chipmakers, where they can simply raise prices on their customers, we don’t want to raise prices on our customers,” he said.
When prices rise, he explained, riders pay more or wait longer as ETAs stretch.
I covered that chipmaker pricing power angle repeatedly, from Micron and SanDisk to AMD, where Lisa Su said demand exceeds supply. Uber is the mirror image. The shortage is there, yes, but the company has chosen not to pass it on.
What Uber’s demand and supply problem means for you standing on the curb
My own wait at the curb was the real-world version of a trend buried in Uber’s results. Riders experience a supply shortage through longer ETAs, canceled trips, and fares that can rise as demand outpaces the number of available drivers, even when the company says it is working to keep prices in check.
Drivers feel the supply gap too. When demand outpaces the available drivers, more earning opportunities open up, giving Uber a stronger incentive to invest in recruiting and retaining drivers.
This matters across the places Uber named. In India and Brazil, ride-hailing is a daily use for millions. In North America, it is the late-night trip home.
A platform that cannot match riders and drivers loses both over time, and a rival like Bolt picks up the rider who got tired of waiting. And they could choose to shift. Entirely.
So, that’s why Khosrowshahi frames supply as the priority. A higher price would clear the market quickly. And it would also push away the very users Uber needs to keep its 200 million-plus audience growing at 14%.
The robotaxi answer, and why it is a long bet
The other half of the supply story is autonomous vehicles. Khosrowshahi said Uber has committed about $10 billion to AV partners and vehicles, including Nuro, Avride and Rivian, and expects over 2,000 AVs in multiple markets in 2027, tens of thousands in 2028, and substantially more in 2029 and 2030.
“Right now, AVs are much less profitable, so to speak, than human beings,” he said, adding that parity will take time. For every dollar Uber invests in partners, he said, they usually raise another $2 to $3 from outside investors.
The demand evidence is fair in markets where AVs launch; he said, growth accelerates. We see that Texas is growing about seven points faster than the rest of the nation in that category. California, a mature market, is the comparison.
Early last month, I wrote about SpaceX’s Starship and the long road from test flight to commercial work. AVs follow a similar pattern: from impressive progress to expensive hardware, and to profit that arrives later.
Uber has committed about $10 billion to AV partners and vehicles, including Nuro, Avride, and Rivian, and expects over 2,000 AVs in multiple markets in 2027.NurPhoto / Getty Images
What to watch next
Uber guided Q4 gross bookings to $63.25 billion to $65.25 billion, representing 18% to 22% growth in constant currency, with non-GAAP EPS of $0.95 to $0.99, up 34% to 39%. Adjusted EBITDA is expected at $3.13 billion to $3.23 billion.
For you as a rider, the near-term test is whether waits shorten without fares jumping.
For investors, the question is whether heavy spending on supply and AVs lifts margins or drags them.
Khosrowshahi answers that more drivers today and more robotaxis tomorrow protect growth. I think the next two quarters will show if he is actually right.
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