CNBC Transcript: Uber CEO Dara Khosrowshahi Speaks with CNBC’s Andrew Ross Sorkin on “Squawk Box” Today

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WHEN: Today, Tuesday, August 1, 2023   

WHERE: CNBC’s “Squawk Box”

Following is the unofficial transcript of a CNBC interview with Uber CEO Dara Khosrowshahi on CNBC’s “Squawk Box” (M-F, 6AM-9AM ET) today, Tuesday, August 1. Following is a link to video on

All references must be sourced to CNBC.

ANDREW ROSS SORKIN: Welcome back to “Squawk Box.” A big day at Uber headquarters, where we are this morning, Uber reporting quarterly results of the ride sharing company achieving what is a milestone, a first ever GAAP operating profit in the company’s history earnings coming in at 18 cents a share that was much better than the ones that the street had been expecting revenue $9.23 billion during the quarter, it’s a little bit below estimates. Uber generated the $1.1 billion dollars of free cash flow during the quarter and joining us right now is the company’s CEO Dara Khosrowshahi, the CEO of Uber. It’s great to see you and it is a milestone. I was actually thinking about this when we sat together when you took over by the way I was looking, bookings were $14 billion, $33 billion right now. And when we were sitting together, EBITDA was off, I mean, negative $869 million, free cash flow was negative $877 million and so today is quite something for you.

DARA KHOSROWSHAHI: It’s, it’s a great day. It’s the amalgamation of a ton of work of everyone on the Uber team, and obviously the drivers and couriers for on the platform. But the performance is there, right? We’ve got gross bookings over $33 billion, up 18% year on year. EBITDA record $916 million up over 50% year on year, free cash flow of 1.1 billion and our first profitable quarter 394 million—

SORKIN: You said this was going to happen this year. Did you think it would happen, I mean, and I remember trying to trying to get you to say when, when in the year. Did you think, did you know this that you were on track at this point?

KHOSROWSHAHI: We thought that we would be on track either in Q2 or Q3. We tend to under promise and over deliver and everything came together this quarter. The team executed really well and we plan to be profitable for, you know, every quarter going forward.

SORKIN: I don’t know if you can see the stock. The stock up is now up about four, almost 5%. At one point, I clicked up over 6%. But really you look back even towards May and it is now a straight line up. How do you think about the company’s valuation in this context?

KHOSROWSHAHI: Well, what I can control is what we’re doing operationally, the service that we are offering to our consumers and the service keeps getting better. Our audience grew by 12% on a year on year basis. The frequency of use, buyer actives grew 9% on a year on year basis. You combine that with cost discipline, you get free cash flow over a billion dollars a quarter. The stock price will take care of itself and I think the stock price is now reflecting a view from investors which we’ve had all along, which is this can be a scale platform on the internet that can be very, very profitable and because we have mobility delivery all on one platform, we’ve got a competitive advantage over the other players.

SORKIN: Let’s just talk about what that is though because we went through Uber 1.0 which was probably the the Travis Kalanick version of it.


SORKIN: I think we might you might have just completed 2.0 of sorts. I don’t know if you take a victory lap on that front just yet.

KHOSROWSHAHI: We’re not ready for victory laps but we’ve come a long way.

SORKIN: But what and that was let’s be honest, I mean, that was almost a daily knife fight for you in terms of trying to get through it all. What is to the extent you now are a platform a profitable one, what is the 3.0 version look like?

KHOSROWSHAHI: Well, I think the 3.0 version for Uber looks like essentially are connecting every single vehicle and driver who is available to take you any place in your local city. And to some extent what that translates to is you’re an operating system for everyday life in a city. Right? When you combine that with ML and AI, we essentially—

SORKIN: Machine learning, artificial intelligence.

KHOSROWSHAHI: Machine learning, artificial intelligence. We essentially are there for you any place you want to go, anything you want to get delivered to your home as we get to know you more and more we become more of a utility and more of, you know, a service that you can’t deal without.

SORKIN: How concerned are you about what’s going on with your competitor, Lyft? They’ve obviously been challenged in part because of your own success, but it very well may be and I will see whether they need to get into a pricing fight with you all over again.

KHOSROWSHAHI: Well, Andrew, I don’t spend too much time worrying about Lyft so to speak. But we don’t see any evidence of a pricing fight at this point. Lyft was not price competitive with us a year ago. They are price competitive with us now. And now we can focus on competing based on brand, based on service, based on innovation and with products like UberX Share and Reserve and — for enterprise, we think we can out innovate all of the competitors.

SORKIN: But you don’t think that as they try to capture share and as you said now they’re price competitive, that they are going to make it a lot more challenging.

KHOSROWSHAHI: I think that the era of of pricing of fighting purely based on price is over. Right. That was three four years ago when it was just about volume but investors now want profitable volume. And if the only thing you have to offer is a lower price, you’re not offering much ultimately. You’ve got offer brand and service and all the evidence that we see as far as Lyft goes and our other competitors are they’re trying to compete in the right way. We think in that world we have an advantage, we’ve got scale.

SORKIN: What do you tell customers and maybe policymakers about this, though. You came into lots of cities across the country at a very low competitive prices, talk about this talk about pricing, in some cases were so successful in that realm that you put a lot of folks either out of business or shifted the business became the successful one and now the price has gone up.

KHOSROWSHAHI: Well, the prices have gone up along with inflation everywhere, right? And when you look at the prices going up, a significant portion of that price is being passed on to actually drivers. So for example, drivers, couriers earn over $15 billion, including tips on our platform. That was up 19% which is up faster than our overall gross bookings growth that was up 18%. So the increase in pricing is really going. The vast majority of that is going to drivers and couriers and we think that’s fair.

SORKIN: That’s happening in a very positive direction when it comes to mobility, meaning people in the cars and delivery. Less so in the freight space. That that has remained a challenging spot for you. Why?

KHOSROWSHAHI: It has because when you look at the consumer and what the consumer is spending on, the consumer continues to spend increasingly on services. If you look pre-pandemic spend on services was about 69% of spend. It’s still only 67% of spend. So more money is going towards towards services, which benefits our mobility delivery business. Freight to some extent is a hedge there, freight is, grows when people ship stuff when they buy stuff. This year, people are buying more services, our freight business is down. We’re adjusting costs but our mobility and delivery businesses are growing are growing at huge rates and larger than ever.

SORKIN: If we were sitting together call it three years from now and we had a pie chart, mobility, delivery, freight. I don’t know do you want to put advertising in there as the other.


SORKIN: Okay. How does, how does that pie chart look?

KHOSROWSHAHI: Well first of all the pie the whole pie is much larger. Right? But I think all of the pieces of the business are going to grow at significant rates in the teens or the 20s. Advertising is going to be the biggest growth area for us because we have a huge audience, over 130 million audience coming at us on a monthly basis onto the platform. This is a high-end audience. They’re very engaged with our platform. They’re going places and what we’re seeing in advertising is 650 million now of run rate revenue growing very significantly, and we’re well on our way to a billion plus next year.

SORKIN: So when you talk about being a super app, what does that look like relative to I, my my Twitter just turned into X. And Elon would like to do a super app too.

KHOSROWSHAHI: Well, we’re not going to rename the company anytime soon. But what we’re focused on getting people places or getting things to them so we are in the real world real time physical movement of goods and services. I think Twitter is a different animal. And again, not someone I’d bet against.

SORKIN: What do you do about surcharges on for traffic. One of the things we’re seeing in New York City is this proposal under 60th street, it’ll cost you 23 bucks to get in and what that will do to either your drivers or traffic or the broader business.

KHOSROWSHAHI: Well, generally, we support congestion pricing and cities to alleviate traffic, etc. Get the vehicles that have the most utility into the most crowded parts of the city. So, we—

SORKIN: Because you pay once.

KHOSROWSHAHI: We’ll pay once generally. Now, it’s proving out to be a real challenge and you’re in New York City to figure out how to make it fair to all the constituencies and it’s important to be a part of that dialogue.

SORKIN: Do you think it’s good for the cities, congestion pricing? I mean, one of the big issues is especially as cities have been challenged in the past couple of years, you know, just having people in the city is a good thing.

KHOSROWSHAHI: It definitely is. I mean, the fact that people are coming back to cities and coming back to New York is terrific. If you think about supply and demand characteristics, there is too much demand for transportation in cities. And therefore, congestion pricing makes some sense. How you put that in to make it fair and equitable to everyone is a tough, tough problem to solve.  

SORKIN: Your headquarters is in San Francisco. Elon Musk was on Twitter over the weekend saying it’s like a doom city but we’re staying. Are you staying?

KHOSROWSHAHI: Yes, we are.

SORKIN: And you have views on, is it a doom city?

KHOSROWSHAHI: Things are tough there. And right now there are feedback loops, you know, sometimes that are negative and positive and positive. San Francisco is going through a negative feedback loop now, but never bet against innovation in that city. I think artificial intelligence, machine learning etc., the excitement there should bring people back and we’re going to be there.

SORKIN: Talking about innovation and AI in particular, you made a deal with Waymo for a self-driving vehicles. This is you’ve been talking about self-driving vehicles for a very long time. You had your own self-driving business—

KHOSROWSHAHI: Yes, we did.

SORKIN: For a period of time. What’s your sense of of how that scales? What happens and really gets to that existential question about you know who the driver ultimately is going to be?

KHOSROWSHAHI: Well, ultimately, if you step back for Uber, we just want to wire up every single car and driver who is safe and provides a good service whether that’s a human driver or robot driver. Okay, the robot drivers have a long way to go to one be as safe as humans and provide the kind of fulsome service that humans can and I know that there’s always the drama are robots going to replace people, etc. Ultimately, what we’ve seen over and over again, is that robots complement humans. And our deal with Waymo is about mixing in Waymo into essentially the Uber network and providing a better service for you, you know, 5, 10 years from now.

SORKIN: Maybe better for the customer, but you’ve also you’re a two-sided marketplace.

KHOSROWSHAHI: Yes, we are.

SORKIN: You’ve spent a lot of time trying to attract drivers in saying, look, this is the place that you should be driving on. What kind of feedback are you getting from drivers who might be saying to themselves, I don’t really know if they’re with me or not. They might be with the robots.

KHOSROWSHAHI: Well, I think what we’re communicating to drivers very, very clearly are that we are squarely in their camp. We’ve, we have improved customer service significantly with drivers the onboarding experience is better. We’ve got 6 million couriers and drivers on our platform. Earnings are incredibly strong. The driver, average driver on the platform is spending more time on the platform, up 7% year on year, and retention is up as well. So, drivers are voting with their — and with their cars and right now they’re voting positively.

SORKIN: A fascinating court decision a week ago with self-driving cars, there was that very, very tragic incident with the self-driving car with a Uber backup driver. And there was a real question about who is responsible, the person or the robot, and in this case, it really is the person but that’s because there was a backup driver in the vehicle. How do you think that changes if there is no backup driver?

KHOSROWSHAHI: Well, I think that all of this shows just how important safety is in developing these technologies that have impact on the real world and can and can affect lives. And for us, we’re very much focused on our platform, saving lives, preventing drunk driving, etc. I think it just shows how careful you have to be here in developing this technology. You’ve got to take your time and I think self-driving is going to take some time.

SORKIN: Okay, we got to go but I just, news you can use about the stars, the ratings, I just discovered you will now actually show people not just your star rating, but actually how many five stars you got, how many four stars you got, doesn’t show you that which driver gave you what—

KHOSROWSHAHI: Yeah, we don’t want to give you the personal—

SORKIN: But you’re now, you’ve now put it out there for folks.

KHOSROWSHAHI: We just want to give you more information so you learn maybe a little bit more about yourself. Andrew, how are you doing?

SORKIN: You know, I had about—

KHOSROWSHAHI: Are you mostly five star or four star?

SORKIN: I had about 1,600 drives and I—

KHOSROWSHAHI: You’re a great customer, thank you.

SORKIN: And I’ve gotten about 505 stars so I’m proud of that. But as you go down the as four stars and it’s, it’s interesting, and then you start to think which was the drive that that cost you the lower, lower star rating.

KHOSROWSHAHI: Now remember, New Yorkers generally are tougher in judging each other you know, there’s this New York attitude, you’ve got an edge.

SORKIN: You’re just rationalizing, you’re making me feel better about myself.

KHOSROWSHAHI: I’m just trying to make you feel a little bit better. Yeah.

SORKIN: Dara, congratulations on a great quarter.

KHOSROWSHAHI: Thank you very much. Good to see you.

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