Uber-Waymo Partnership Deteriorates, Threatening Autonomous Vehicle Thesis

What happened

Uber's relationship with Waymo, a cornerstone of its autonomous vehicle strategy, is reportedly deteriorating. This development surfaces just as Uber's stock had rallied on expectations of commercial robotaxi launches, including a planned Bay Area service with Lucid and Nuro. Waymo, which already operates its own ride-hailing app, has been expanding autonomously in multiple cities without always parallel Uber integration. The news echoes risk factors in Uber's own filings, where it admits partners can remove vehicles or end agreements at any time. Consequently, the market may need to discount the AV upside that had been priced in, shifting focus back to Uber's core Mobility and Delivery profits.

Implication

If the partnership dissolution is severe, Uber's ability to aggregate third-party AV supply weakens, pushing the autonomy narrative further into the future and leaving the stock dependent on core business execution alone, which could cap upside to the base-case $82.

Thesis delta

The investment thesis previously gave credit to AV partnerships as a near-term catalyst. With the Waymo relationship deteriorating, the AV optionality is diminished, requiring a greater margin of safety from the core business. Until there is clarity, the bull case ($94) becomes less likely, and the stock may gravitate toward the bear case ($62) if other AV partners follow suit.