Uber CEO Khosrowshahi has identified India as one of the most challenging markets for growth, acknowledging the demands of customers who seek more services while spending very little. Speaking during a fireside chat with Infosys co-founder and Aadhaar architect Nandan Nilekani in Bengaluru on February 22, Uber CEO Khosrowshahi highlighted the difficulties posed by the Indian market, stating that “India is one of the toughest markets out there; they are so demanding and do not pay for anything. If we can succeed here, we can succeed anywhere else.”
Despite these challenges, Uber CEO Khosrowshahi outlined Uber’s plans to expand its low-cost service segments, particularly focusing on two-wheeler and three-wheeler services in India. “One of the strategic single biggest opportunities is lower cost products like two-wheeler and three-wheeler… We are also getting into bus in some countries,” he noted.
The core ride-hailing business of Uber faced significant setbacks during the pandemic, with lockdowns limiting movement from one place to another. Uber CEO Khosrowshahi reflected on the tough decisions the company had to make, including layoffs, and the need to change its approach and strategy. “We were much focused on consumers and we took drivers for granted but post-pandemic we had to focus on our drivers. So we changed and offered them more incentives,” he added.
Despite these challenges, Uber posted its first annual net profit last year since going public in 2019, with free cash flow reaching $3.4 billion in 2023, a significant increase from $390 million a year earlier.
Looking ahead, Uber expects gross bookings growth in the mid to high teens percentage and adjusted core profit growth in the high 30 to 40 percent over the next three years. In India specifically, Uber reported consolidated revenue of Rs 2,666 crore in FY23, driven by a surge in revenue from rides and supported services. Revenue from rides increased by 74 percent to Rs 678 crore compared to the previous fiscal year, while revenue from support services reached Rs 1,977 crore, marking a 52 percent year-on-year increase, as per MCA filings sourced from data and research agency Tofler.
The focus on expanding low-cost services, particularly in markets like India, reflects Uber’s adaptability and resilience in navigating challenging environments. As the company continues to evolve its strategies to meet the demands of diverse markets, the leadership of Uber CEO Khosrowshahi remains pivotal in driving Uber’s growth and success globally.