In partnership with
Apple’s Starlink Update Sparks Huge Earning Opportunity
Apple just secretly added Starlink satellite support to iPhones through iOS 18.3.
One of the biggest potential winners? Mode Mobile.
Mode’s EarnPhone already reaches 490M+ users that have earned over $1B, and that’s before global satellite coverage. With SpaceX eliminating "dead zones," Mode's earning technology can now reach billions more in unbanked and rural populations worldwide.
Their global expansion is perfectly timed, and investors like you still have a chance to invest in their pre-IPO offering at $0.52/share.
With their recent 32,481% revenue growth and newly reserved Nasdaq ticker, Mode is one step closer to a potential IPO.
Please read the offering circular and related risks at invest.modemobile.com. This is a paid advertisement for Mode Mobile’s Regulation A+ Offering.
Mode Mobile recently received their ticker reservation with Nasdaq ($MODE), indicating an intent to IPO in the next 24 months. An intent to IPO is no guarantee that an actual IPO will occur.
The Deloitte rankings are based on submitted applications and public company database research, with winners selected based on their fiscal-year revenue growth percentage over a three-year period.
THE HEADLINE
Uber just delivered one of its strongest quarters yet.
The stock fell anyway.
Why?
One accounting change made revenue look much weaker than the underlying business actually was…
Once you look past the headline, the real story becomes difficult to ignore:
Margins grew all across the board
User count and bookings continue to push record highs
A new FCF milestone was reached as promised
And most importantly,
Management continues to reward investors by devouring the share count, increasing our upside without having to lift a finger.
The problem is…
In a market where the only thing that matters is AI and “growth at any cost”, not many care for rising margins and FCF.
Until they do.
Nancy Pelosi and a handful of other congress members are in this stock, and so is the Offside Portfolio.
The initial reason why we decided to buy Uber remains intact.
If anything,
Today’s results made a stronger case to keep holding - and potentially add to - this company.
Uber earnings,
Why it continues to be a compounder from here.
THE DRIVERS
If you read our deep dive on Uber.
You know that 94% of percentage swings in revenue, and gross margin sustainability, comes from monthly active user growth.
Now that Uber grew this metric by 16% on the year, reaching 208 million this quarter, I believe the future growth trajectory embedded in our valuation models remains intact.
We’ll talk about that later.
For now, know that this metric cuts through one of the biggest bear cases:
Uber is not getting replaced by autonomous vehicles (or any AI for that matter)
When we go down the monetization route, it seems the economics are just as strong as they’ve ever been.
Revenue per user has grown by an additional 7.4% compared to last year.
There’s a specific reason why this is, and I will walk you through it here.
For now, know that this rate of growth continues to outpace inflation in the United States and most of the countries where Uber operates.
Economic value continues to be generated, and that is a direct accrual toward a higher valuation multiple for the company and its future perception.
Last but not least, let’s talk about bookings.
Here is the heart of our thesis in one image.
Delivery bookings are now close to breaking past mobility bookings.
This has a few implications around the economics of each:
Delivery has less regulatory hurdles around it
It is less likely to be disrupted now that Uber cemented partnerships with restaurants for win-win economics
Cultural and work settings continue to make this a high-value area
The most important of which are the regulatory hurdles.
Uber is now being forced - in some areas - to treat its drivers like full-time employees and not contractors.
That includes:
Benefits
Hourly work limits
Required breaks
Guaranteed minimum wage
This significantly affects operating margins and net profits.
Which is why management is so focused on making delivery the growth engine, and is so far succeeding at it.
WHAT MATTERS
Bookings growth in delivery has already crossed mobility as the largest segment.
Meaning, it’s a matter of time before Uber shifts into a delivery business that also happens to perform a taxi service.
Which is why the ONE accounting change made all the difference here.
Uber is now building revenue costs as a deduction to booked revenue (not as a cost of sales item)
Which is why revenue growth was only booked at 12%, when in reality it should have been closer to 20%.
I suspect the reason behind this change has everything to do with delivery becoming the new driver for Uber.
Why?
If all the benefits and guarantees going to mobility drivers affect revenue growth, and delivery costs do not…
Changing how they account for revenue can both boost growth rates and gross margins entirely.
Magnificent 200 IQ move from the team.
Another point for management is found in the free cash flow.
Last year, Uber promised shareholders it would deliver over $10 billion in free cash flow for the FY26.
We’re halfway through the year, and the target has been met (and exceeded by ~$200 million.)
All of which resulted in a net boost for returns on invested capital and future shareholder rewards.
UBER EBIT Margins, Offside Capital
If you take a look at the company’s trajectory.
Buying now is 100x easier than thinking about buying when it was just getting started as a respectable player.
With operating margins now growing steadily, and economies of scale spreading costs more effectively.
Not to mention the boost in gross margins and revenue growth from delivery…
I suspect we will continue to see more and more investors become interested in this company.
Any value investor would, such as Bill Ackman (an owner in the stock) and the handful of congress members joining Pelosi now.
If you’re a free subscriber…
I hope you got a ton of value from this report.
But,
This is where we part ways.
I will now cover (for Offside Premium members) my valuation update and the Autonomous Vehicle risks for Uber after today’s figures.
And,
The important part about Uber’s equity investment portfolio…
Subscribe to our premium content to read the rest.
Become a paying subscriber to get access to this post and other subscriber-only content.
Upgrade