Everyone’s Focused on the Wrong Thing in Bill Ackman’s $2 Billion Uber Move

Uber stock is up 8% after Bill Ackman came out swinging, revealing that his hedge fund, Pershing Square, went to the bank and dropped $2 billion into the ride-hailing giant that IPO’d in 2019. Predictably, fintwitter lost its collective mind, with posts like: “Uber stock surging! Bill Ackman is all in! Just bought call options on Uber!!! 🚀🚀🚀” (You just know that somewhere, a dude in his parents’ basement is maxing out his Robinhood margin as I write this.)

But let’s chill out for a second. That 8% jump is purely retail traders piling in, hoping to ride a billionaire’s coattails. That’s not real, sustainable value… that’s hype. Forget about Bill Ackman, the most important story is that Uber, more than any other player (including Tesla) is closer to autonomous ride-hailing.

First, let’s get this out of the way: Uber isn’t some dirt-cheap hidden gem. The stock is already up nearly 100% in the past year. In my opinion, what Ackman is really banking on is what Uber could become… a logistics and transportation monopoly that runs on algorithms, not human drivers.

Uber’s latest earnings were solid but not flawless. They reported gross bookings of $44.1 billion, up 18% year-over-year, and beat revenue expectations. But profits came in lower than expected thanks to rising costs, and guidance for Q1 2025 wasn’t exactly setting off fireworks in Manhattan offices. The stock initially dropped 7% before bouncing back on Ackman’s endorsement.

But here’s where it gets interesting: Uber’s future is far more than about making a few extra cents per ride. It’s about eliminating the most expensive part of its business… the driver. And despite what the Tesla fanboys will tell you, Uber is arguably better positioned than Elon’s Cybercab to dominate the autonomous future.

Tesla’s approach to autonomy is the classic Muskian fever dream: build an entire fleet of robo-taxis from scratch, promise the world, and push back the timeline when reality gets inconvenient. On the other hand, Uber has taken a far more pragmatic approach… leveraging partnerships instead of burning billions trying to build its own self-driving tech.

Uber sold its Advanced Technologies Group to Aurora back in 2020 and has since focused on working with existing leaders in the AV space. Its current key partnership is with Waymo, Alphabet’s self-driving subsidiary, which is already operational in multiple cities. Later this year, Uber users in Austin and Atlanta will be able to hail Waymo robotaxis directly from the app… at the same price as a regular UberX.

This is a big deal. Uber doesn’t have to spend billions building a self-driving fleet from scratch like Tesla. It’s simply integrating the best autonomous tech into its existing network. That means it can scale faster and more efficiently than Tesla’s Cybercab, which is still years away from meaningful deployment.

Uber CEO Dara Khosrowshahi is apparently excited about where this is heading. On the company’s latest earnings call, he said Uber is “very well-positioned” to capture what he sees as a $1 trillion opportunity in autonomous transportation.

(Source: CNBC)

Think about it… right now, Uber drivers take around 75% of a fare. In an autonomous future, Uber keeps nearly all of it. That’s an entirely different business model… one that transforms Uber from a middleman into a dominant logistics empire.

And while regulatory hurdles remain, Uber is playing the long game. It’s making partnerships, getting local governments on board, and strategically rolling out autonomous options in key markets. While Tesla is still stuck in the loop of over-promising and under-delivering on Full Self-Driving.

So here’s the million dollar question… is Uber a buy? Ackman clearly thinks so. But not because the stock jumped 8% on retail FOMO. The real story is that Uber transitions from a ride-hailing company to a full-blown autonomous network operator… without the massive CapEx that Tesla and others will have to endure.

If Uber gets this right, it becomes an unstoppable force in transportation. If it doesn’t, well… it’s still a $150 billion company with a dominant market share, so it’s not exactly the end of the world.

For now, Ackman’s move is a long-term wager on the future. It won’t happen overnight, but when it does, it could mark the biggest transformation in Uber’s history.

PS: If you want a front-row seat to the stock market puppet show… Become a Premium Member to get access to our Insider Trading Tool. We built it so you can see exactly where CEOs and Congress members are quietly investing their millions. Plus, you'll get exclusive stock write-ups and reports. Click here to see all the benefits of becoming a premium member.

Stock.News has positions in Uber, Alphabet, Robinhood, and Tesla.